1. By: Juan P. Garcia Organizational Research Services Director Total Rewards, Trends and Plan Design Take a Chomp Out of Your Comp!

2. 2 Total Rewards, Trends and Plan Design ABOUT THIS PRESENTATION Plan Design & Compensation Trends Top Trends Overall Market Movement Industries Building Blocks, Compensation & Benefits: Key Foundation of a Total Rewards Strategy General Framework EG’s Employers of Choice Model Check-off Inventory Sample Case EG’s New Online Compensation program

3. 3 Total Rewards, Trends and Plan Design Plan Design & Compensation: Top Trends Tops Trends  Soft salary increases likely trend for the next two years  Soft employment levels & low turnover  About 45% of cos. will rebuild / overhaul existing plans  More Cos. are evaluating other costs, pension, leaves, etc.  Cos. are actively evaluating / building their performance management program  Recalibrating payouts, executive compensation

4. 4 Total Rewards, Trends and Plan Design Plan Design & Compensation: Top Trends Top Trends - continued  Internal equity and alignment – job evaluation programs  Concerns for Federal Contractors re employment Practices that lead to Compensating Disparities  Concern on new minimum wage:  1% of employees earn less than new min; 5% earn between $9 and $10  non-profits, 3% are below new minimum, 7% earn between $9 and $10

5. 5 Total Rewards, Trends and Plan Design Market Movement, Increases & Employment

6. 6 Total Rewards, Trends and Plan Design Plan Design & Compensation: Top Trends Industry Trends Manufacturing: S oft increases, 3%; Increase in OT, “OT is better than adding staff” Finance, non-banking sector: Above average increases, 3.7%+, aggressive bonus plans, 70% percentile Non-profits: Transparency, especially with executive pay, very receptive to internal pay equity, managing hours of part-time employees Hospitality: Concerns with n ew minimum wage, wage compression concerns; dealing with part-time employees, adding more $$ to train entry level EEs Sales: Recalibrating commission plans; as economy improves, payout and thresholds are being examined

7. 7 Total Rewards, Trends and Plan Design Plan Design & Compensation: Top Trends OVERALL: On existing Talent:  Moderate Increases likely to continue into 2016  Cos. are more very receptive to retain and train  Investing to develop EEs, existing skills, job families  Address market disparities by spot market adjustments On New Talent:  Wait-and-see before adding to payroll ranks  Wage compression caused by new EEs demanding higher salaries

8. 8 Total Rewards, Trends and Plan Design Building Blocks, Compensation & Benefits: Key Foundation of a Total Rewards Strategy Best Places to Work & Employers of Choice:

9. 9 Employers Group: Employers of Choice Model

10. 10 Total Rewards, Trends and Plan Design Building Blocks, Compensation & Benefits: Key Foundation of a Total Rewards Strategy From WorldatWork, Total Rewards Model

11. 11 Total Rewards, Trends and Plan Design Building Blocks, Compensation & Benefits: Key Foundation of a Total Rewards Strategy

12. 12 Total Rewards, Trends and Plan Design Building Blocks, Compensation & Benefits: Key Foundation of a Total Rewards Strategy How to rebuild or build a basic program - Checklist: 1. Where is your plan vs. key measures? Costs and market HR Metrics & Bureau of Labor Statistics 2. Has the plan been maintained? How? Upgrade ranges by 2% 3. Internal alignment: Is it defendable? 4. Updated JDs, jobs with multiple areas of responsibility? 5. Define your market; consider your recruiting practices 6. Update your performance management program, clear performance measures 7. Surveys – If possible, have 2 to three different sources

13. 13 Total Rewards, Trends and Plan Design EG’s Survey Program Effective 2013, program has been converted to an online model Features: Personalized Survey Libraries (2009- ) Access to all Survey Data, Comp & Benefits (900 classifications) Online comp market analysis Quarterly Updates based on market movement How to enroll? Build your Library by uploading your data: (a) Match jobs to EG (b) EG will do match for you System Enhancements Allow users to enter non-EG market data – Q2, 2014 Benefit Cost Assessment Analysis – Q3, 2014 Job Evaluation System of all EG Jobs – Q4, 2014 Consulting Program: Comp Administrative Modules

14. 14 Total Rewards, Trends and Plan Design Attendees have been enrolled: egsurveys.net 2014 Budgets and Economic Trends, (Reg. $295) Employer Healthcare Benefits Survey, (Reg. $395) This PowerPoint Presentation Access your account: Existing Users:  your email address  your current password New Users:  your email address  passwords: bluela (My EG Compensation Page): bluela If you did not select this as your PM Breakout, please see me after the presentation.

15. 15 Total Rewards, Trends and Plan Design egsurveys.net Existing Users New Users Arroyo Insurance Services Inc AS Consulting Autry National Center Baker Brand Communications Barney & Barney LLC BLT Enterprises Bolton & Company Clinicas Del Camino Real Crown Media Family Networks Film LA Inc Forest Lawn Key Health Group Inc Living Spaces MMC Inc Poly-Tainer, Inc. Screen Actors Guild - Producers Pension and Health Plans Sigue Corporation The Bobrick Corp. The Buckley School Youth Policy Institute Deluxe Media Services Fashion Institute - LA Legalzoom.com Phoenix House of California Photo Sonics, Inc. Platinum Group of Companies Southern California Gastroenterology Associates Trial Memberships

16. 16 Total Rewards, Trends and Plan Design EG Compensation Tools: Site Tour  Personalize Library  Online Market Analysis

17. 17 Total Rewards, Trends and Plan Design Thank you!!! Juan P. Garcia 213.765.3969 jgarcia@employersgroup.com