AbstractThis research paper explores executive pay and compensation and the impact of golden parachutes and incentives on the workplace. Specifically, this document explains the various types of compensation and how each organization determines rates and salaries. This document also details people in US history who have received significant quantities of golden parachutes. I will examine the validity of incentives in the workplace and present the pros and cons of an incentive program. Finally, I will discuss how to build an effective incentive program and the possible pitfalls of the program. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay Incentives and compensation are the basis of employee work morale. It is the main reason why work exists. In economics, the company has objectives to achieve and to do so it needs human capital. In family, people need to work to earn money and survive. Essentially it is an exchange of work for compensation. Compensation can be defined as money or benefits earned by an employee from an employer in exchange for labor or human capital. Incentives drive work as they provide motivation for extraordinary work. The idea behind employee incentives is to give employees control of their own performance. Employees feel valued when compensation packages match their qualifications, and they feel valued when incentives are awarded. These, in turn, increase self-esteem and job satisfaction and ultimately increase employee work morale. When talking about pay, it's important to note that pay can be broken down into different categories. Categorically, financial compensation or direct compensation comes first. Direct financial compensation is the most important and well-known compensation method. Direct compensation is the money paid directly to employees in exchange for their work and is the one most sought after by workers. This category includes everything from hourly earnings, set salaries, bonuses, tips and commissions. (Canadian Association of Professional Sales, 2018). Financial compensation for a particular job is multifaceted. First, the company should understand what work is worth paying an employee for and how to make the pay competitive in the industry. The amount may also depend on the specifics of each employee. Let's look at these factors in a little more detail. One might ask the question, “how does a company decide how much an executive should be paid”? The answer to this question is simple; according to salary.com, the CEO compensation rate sets the maximum pay ceiling for the company. They also say that when companies establish payment structures, they outline payment for highest- and lowest-wage professions before addressing compensation for jobs in between. In the old “internal equity method” of setting a compensation structure, CEO pay sets a ceiling for the company, and each lower level is compensated at a comparatively lower level. If you know how well the CEO is paid, you can get an idea of ​​how generous the company is likely to be to other employees as well. The second type of compensation is considered an indirect financial compensation or a non-financial reward. This part includes all fees paid to a worker who does notinclude indirect compensation. Normally, this payment method is often accepted as part of the employment contract covering items such as temporary absences, benefits and pension plans. Health insurance is one of the most important methods of indirect financial compensation. Employers are responsible for the vast majority of health insurance coverage. Knowing which policy to select is critical as price can be a factor. Group coverage is seen as at the lower end of the spectrum, while individual policies can leave a mark in someone's pocket. Group insurance is advantageous because workers typically pay for their own coverage, yet profit from significantly reduced medical expenses. There are also many workplaces that offer disability and life insurance coverage to protect workers and encourage employee retention. With flexible hours, employees can receive payment. Flexible hours offer workers the opportunity to work beyond the usual 9 to 5 schedule. This can be extremely beneficial for parents who have the responsibility of picking up children or keeping appointment times. Additionally, it can be beneficial for workers who work best in the early hours of the morning or late at night, and for those who have personal things to take care of without having to take sick days. This works for some companies more than others. Bank offices, for example, are less adaptable because they are usually open during business hours. However, organizations that are unfamiliar with customary working hours may choose not to comply with employees' normal working hours. Being stuck in traffic and increasing stress before setting foot on the job every morning can leave employees with a terrible attitude. Allowing them to work from home once is beneficial to the employee as it provides peace of mind. If you give credit to the Internet and innovative advances in business communications, workers can, in any case, meet their obligations regardless of whether they travel further than from their room to the home office. The key to making this work is a reliable team and an excellent, effective IT department. Organizations understand that a strong workforce is more beneficial and requires fewer sick days. So, beyond the scope of medical coverage, numerous organizations offer gym memberships, on-site recreation centers, and regular health checkups. Organizations like this also provide reps with free meal cafeterias and babysitting services to ease some parental tension. Management can expect several benefits, such as luxury accommodations, dry cleaning services, national club memberships, passes for social and formal occasions. Some organizations even go as far as providing these benefits through golden parachutes. Meg Whitman is an American business executive, political activist, and philanthropist. Whitman was president and CEO of Hewlett Packard Enterprise. She is a top executive with a world record of a significant amount of golden parachute benefits totaling $9 million in case of merger and $51 million in case of dismissal. On November 20, 2017, she announced that she would step down from her role as CEO effective February 1, 2018. Golden parachutes are on the rise. (See Appendix A) People everywhere are alarmed by golden parachutes, except the people who receive them. Why do they exist? According to Investopedia, golden parachutes exist with key executives as a kind of anti-takeover strategy,mutually also referred to as poison pills. These are substantial benefits awarded to senior executives if the company is taken over by another company or if executives are fired following the merger or takeover. The concept of the golden parachute was born in the late 1970s, followed by extreme acquisitions. Since junk bonds became a reality, takeovers have become likely and even the richest of Fortune 500 companies have been deemed unsafe. By 1896, one-third of U.S. companies implemented the golden parachute concept. Some speculate that golden parachutes exist because of corporate insecurity. There were even more differences in the things provided by the golden parachutes. The simplest and simplest parachutes might only provide a lump sum cash payment. On the other hand, higher golden parachutes can include stocks and options and dental insurance. (Fiss, P. 2016) Another aspect that boosts employee work morale is incentives. According to BusinessDictionary, incentives are what encourages or complements a reward that serves as an inspirational device for a desired action or performance. It's almost safe to say that everyone loves incentives. Incentives are a fundamental part of life. Identifying and rewarding employee performance and contributions is a key factor in creating a workplace culture or morale. Employees' job satisfaction and self-confidence increase when they know their contributions are valued and valued. (Strategic Incentives, 2014) The Huff Post argues that there are numerous other ways to reward an employee besides money. One such example is building a company culture that identifies good work and performance with benefits and words of encouragement, and providing an environment where people have a say and ownership of their work. Employers have a wide variety of incentives to choose from. Incentives can be divided into two categories; monetary and non-monetary. Monetary incentives can be a very powerful factor in employee motivation and performance which, as a result, can lead to significant revenue in terms of organizational performance. (Herman A., Harry J., Gottfredson R. 2012) Salary and benefits are the main and basic type of monetary incentive for employees. This type of incentive also includes salaries, travel allowances and other benefits. There may be salary increases from time to time; monetary incentives also include this. A bonus is a kind of monetary incentive whereby employees are offered extra money during celebrations such as Christmas. Profit sharing is another important source of incentive in the workplace. Profit sharing occurs when employees are offered shares in the company. This particular aspect of monetary incentive helps inspire employees to contribute their maximum since their profits are directly linked to the organization's profit. Pension benefits are also monetary incentives where provident funds, pension plans and gratuity. Finally, prerequisites and fringe benefits such as education for children and auto plan benefits are included in the monetary incentives. On the other hand, non-monetary incentives are those incentives that help satisfy an employee mentally, socially and emotionally at work. The first type of non-monetary incentive can be described as status. Status is an employee's position in the organization with respect to authority, duties, rewards, respect, and recognition...