Compensation Questions and Answers

Start Your Free Trial

Identify and discuss those classified as special groups in compensation.

Expert Answers info

Kale Emmerich eNotes educator | Certified Educator

calendarEducator since 2019

write1,138 answers

starTop subjects are Literature, History, and Business

There are several special groups when it comes to ideas of compensation. These are groups or individuals who have a different pay scale or structure than the rest of employees. The majority of individuals in a company are on a simple hourly or salaried wage (typically referred to as exempt and non-exempt—meaning exempt from overtime pay for salaried individuals or not exempt from overtime pay for hourly employees), which may include a modest bonus.

Special groups, however, are people not confined to that structure. Sales staff are one of the biggest groups—typically, they are paid a smaller base salary with a generous commission structure.

Additionally, managers and higher level employees, as they are leaders of people and help to direct and guide the business, typically receive a significantly higher salary and bonus (sometimes up to 50% of their base pay), which is different in comparison with their reports.

Finally, directors and C-level employees are special groups as well. These people are typically paid extremely well and receive major additional compensation related to the company's performance—such as equity in the company that appreciates as the company does better, a portion of overall profit, or a generous bonus tied directly to performance of the company.

check Approved by eNotes Editorial

Lynnette Wofford eNotes educator | Certified Educator

calendarEducator since 2011

write7,057 answers

starTop subjects are Literature, History, and Business

The basic definition of special groups is those employees of strategic value to a company, who therefore have compensation packages consisting of more than the common, basic hourly wage. In a sense, they can be defined as systematically important employees.

The first group is the Board of Directors, who are not regular employees, but who answer directly to shareholders. Outside or independent directors are normally compensated with a mix of a stipend, equity, and other benefits including liability insurance.

Next, executives and upper management are considered systematically important to a company, and normally receive a complex compensation package including base salaries, stock options, bonuses, "golden parachutes", and other incentives.

Sales people often work on commission or a combination of salary and commission. 

Especially in technology, entertainment, and other field in which revenue is based on creativity and innovation, employees such as film directors, scientists, or other key creative or technical people form a special group. These people may be compensated by a mix of salaries and royalties, as well as stock options and bonuses. 

Further Reading:

check Approved by eNotes Editorial


Ask a Question

Additional Links