Organizational Objectives and Total Compensation in Different Markets

Organizational Objectives and Total Compensation in Different Markets

HRM - 324

Organizational Objectives and Total Compensation in Different Markets

Several significant employment laws exist to provide protection and guidance to employers and employees regarding compensation.  The laws that influence Total Compensation include 1) income continuity, safety, and work hours; 2) pay discrimination and the Civil Rights Act of 1964; 3) accommodations for workers with disabilities and family needs and 4) wage laws.  In a federally contracted biotech industry, several laws and regulations may or may not apply to the private sector similarly.

Income Continuity, Safety, and Work Hours

Several Acts were created to protect employers and employees regarding income and safety.  These Acts affect compensation and play a crucial role in private and government sector businesses.  The minimum wage laws are governed by the Fair Labor Standards Act of 1938 (FLSA), and Overtime provisions are regulated by the Portal-to-Portal Act of 1947 and the Equal Pay Act of 1963.  Finally, child labor is a key element when creating a total compensation package and fall under the FLSA (Martocchio, 2015, p.16).

Fair Labor Standards Act of 1938

        Under the Fair Labors Standards Act of 1938 includes several requirements for individual minimum wages, overtime pay, and child labor provisions (Martocchio, 2015).  Minimum wage requirements were created to establish workers with an acceptable standard of living.  Some states and areas in states have higher minimum wages than the federally mandated minimum, and some states do not have a separate minimum wage.  However, some jobs and employers are exempt from the minimum wage.  Overtime provisions include paying non-exempt employees one-half times their wage for anything over 40 hours per 7-day period.    

Portal-to-Portal Act of 1947

        Under the Portal-to-Portal Act of 1947 was created to define the work activities and hours that can apply to compensation under the FLSA.  Such activities include travel times, on-call time, some rest periods, jobs that require sleeping on duty, meetings, training programs, and more (Martocchio, 2015, p.28-29).

Equal Pay Act of 1963

        Under the Equal Pay Act of 1963 discusses the importance of pay equality between the sexes.  It is illegal to pay a higher or lower wage based on someone’s sex.  The wages must be uniformly based on qualifications and performance of the job.  The act is based on the principle: “Men and women should receive equal pay for performing equal work” (Martocchio, 2015, p.30).

Child Labor Provisions

        Several child labor laws and provisions apply to all businesses, federally or private, and are governed by the FLSA.  The FLSA protects workers under certain ages, depending on the work and employment.  The protections cover 1) not employing any child under 14; 2) ages 14-15 have several restrictions and limitations on the type of work, times, and hours they can be employed; 3) ages 16-17 cannot work in dangerous jobs but are not restricted on hours or times.    

Pay Discrimination

Discrimination is more than just a legal and ethical issue. Discrimination is a personal issue that should never exist in the workplace.  Some discrimination laws that relate to compensation plans includes the Equal Pay Act of 1963, Civil Rights Act of 1964 under Title VII, Executive Order 11246 (1965), the amended Age Discrimination in Employment Act of 1967, Executive order 11141 (1964) and the Civil Rights Act of 1991 (Martocchio, 2015, p.16).

Equal Pay Act of 1963

        The Equal Pay Act of 1963 was created to solve employment discrimination issues in the private sector regarding jobs of equal skill, effort, responsibility, and conditions.  The EEOC is the authoritative enforcer on investigating and handling claims regarding illegal discrimination in all labor organizations.  

Civil Rights Act of 1964 under Title VII

        The Civil Rights Act of 1964 under Title VII is relevant to compensation based on equal employment opportunities for minorities that are understated.  The discrimination cannot include intentional discrimination (disparate treatment) nor have employment practices that create unequal treatment toward protected groups (disparate impact) (Martocchio, 2015, p.31).  Also, the Bennett Amendment (1964) is part of Title VII and allows women to file claims under this Act.        

Executive Order 11246 (1965)

        The Executive Order 11246 extends standards to the Title VII where companies with government contracts must create affirmative action plans.  

Amended Age Discrimination in Employment Act of 1967 (ADEA)

        The ADEA was passed to protect employees over the age of 40 from illegal age-related discrimination.  This Act includes refusing to hire or to fire someone based on their age over 40.  It also protects from discrimination where “compensation, terms, conditions, or privileges of employment” are concerned (Martocchio, 2015, p.33).   It also does not allow the employer to refuse health benefits based on age of the employee or spouse, but the employer can charge more for benefit coverage.  For Federal contractors, the ADEA is applied under the Executive Order 1141 (1964).