Contingency Plan

To overcome the possible attrition rate, company can make some contingency plans.
Therefore, Company can use some modification in compensation plans to improve retention
rate which are currently 30% lower than competitor. Different types of option in
compensation plan which company can practice, they include: 1). Salary equivalent to
Industry Standard. 2). Performance base commissions like profit Sharing, Merit Pay to
encourage young Employee. 3). Company can also offer Stock options and Travel/
Meal/Housing Allowance to attract young Talent in company. 4). It also can include benefits
in compensation plan like Dental, insurance, medical, vacation, leaves and retirement plan
to retain employee with company.
To implement above plan, company should develop a philosophy to pay compensation.
Thus, it forms a compensation committee, which determine the extent to which employee
benefits should replace or supplement cash compensation and also decide whether the
company should set salaries at, above or below market or competitors level. In addition, it
also develops a salary administration policy, which includes the general company policy,
specific policies for selected group (best performing and non-performing), consider present
expense of bringing the present staff up to the proposed levels and also consider review and
approval of line manager in compensation policy.