What should be the main consideration when developing a compensation system at Fresh Munchables?

When developing a compensation system, the main consideration should be internal equity and market competitiveness. Internal equity refers to the fairness and consistency of pay levels within the organization, ensuring that employees with similar roles and responsibilities are compensated similarly. This approach fosters a transparent and motivated workplace culture, reducing grievances related to pay disparities and promoting employee satisfaction and retention.

Market competitiveness is equally important, as it ensures that the organization's compensation packages are aligned with industry standards and reflect the current economic conditions. By benchmarking against competitors, Fresh Munchables can attract and retain top talent while avoiding the risk of significantly underpaying employees, which could lead to attrition and difficulties in hiring.

Taking into account both internal equity and market competitiveness helps create a balanced approach that not only supports the organization’s strategic goals but also meets employee expectations. This dual focus ultimately contributes to a more effective and sustainable compensation system that benefits both the organization and its employees.