1. By: Juan P. Garcia Organizational Research Services Director EMPLOYER OF CHOICE 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: Top-line trends Top Trends 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 seem to be the trend for the next two years  Soft employment levels & low turnover  Rebuilding / Overhauling existing plans  Cos. more likely to evaluate other costs, pension, leaves, etc.  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 aligment  Upgrading Job Descriptions  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 Services: Recalibrating performance management and compensation plans to meet market levels and business goals 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. very receptive to retain and train  Investing to develop existing skills, job families  Address current needs, 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  60% of companies have no salary ranges, they run on pure market pricing 2. Has the plan been maintained? 3. Internal alignment: Is it defendable? 4. Acknowledge jobs with multiple areas of responsibility 5. Define your market: Consider recruiting practices 6. Performance Management program: Include clear performance measures

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 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: blueoc (My EG Compensation Page): blueoc 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 7 For All Mankind Alumafold Pacific Inc American Dental Partners of California Inc APRIA Healthcare Barney & Barney LLC BI Nutraceuticals Bicycle Casino California Foundation for Independent Living Centers Deschner Corporation Endologix Festival of Arts of Laguna Beach Flatirons Solutions Galardi Group Griswold Controls Griswold Industries Horiba International Corporation Keystone Pacific Property Management Lake Mission Viejo Association Inc Living Spaces Mattco Forge Inc Mirion Technologies (GDS) Inc Multiquip Inc Nobel Biocare Parker Hannifin Corporation Sigue Corporation SkyOne Federal Credit Union Sohnen Enterprises Spatz Laboratories Inc Statek Corporation Unified Grocers Vans Inc - Santa Fe Springs Village Nurseries Weber Metals, Inc. Workman Molina LLC Existing Users APTwater Arena Pharmaceuticals Citizens of Humanity Deluxe Media Services El Centro Regional Medical Center Elevation Consulting Group Ergobaby Hospice Care of California Kelly Pipe Co LLC Realty One Group Skyworks Solutions Inc Smith Micro Software VIP Rubber

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