Revision of the Existing and Development of a New Compensation & Benefits System

Objectives:

• Identify strengths and areas for improvement
• Develop a system aligned with business and HR strategies and HR best practice
• Ensure that performance is adequately rewarded (by aligning the individual contribution of every employee with the company's business purposes)

KPMG scope of work:

• Analyze existing C&B system
• Make recommendations for the improvement of the C&B system, and develop a plan of action
• Design guidelines for a new C&B system
• Assist with the development of new or the amendment of current C&B policies and procedures

Job Evaluation and Grading

Objectives:

• Ensure internal equity of base pay structure
• Provide clear guidelines for defining the competencies associated with particular positions
• Create a salary structure which is more consistent, clear and easy to manage

KPMG scope of work:

• Analyze existing base pay structure
• Recommend the most appropriate method for job evaluation
• Conduct job evaluations in order to determine the relative value of positions
• Develop grades based on the results of job evaluations that can be used for:
  
  • Determining salary levels
  • Allocating benefits
  • Establishing performance goals and employee responsibilities
• Develop system review guidelines to increase transparency and cut management costs, and assist with developing corresponding adjustments to C&B policy, regulations, employment agreements, etc.
  
• Design a base pay structure for the developed grades
• Develop a transition plan

Short-Term Incentive Plans

Objectives:

• Align employee remuneration with company / unit performance
• Develop a performance appraisal system
• Be more flexible and cost-effective when using wage funds

KPMG scope of work:

• Develop the content and detailed mechanism of an incentive plan for:
  
  • All company employees
  • Employees of a certain department
  • Particular employee groups (e.g. top management, sales specialists, etc.)
  • Project team
• Develop the main parameters of the plan (e.g. eligibility, amount of incentive opportunity, performance-reward schedule, approach to using KPIs)
• Develop models to calculate payouts under the plan
• Develop a transition plan and recommendations on the administration and review of the plan

Long-Term Incentive Plans (based on shares or monetary payments)

Objectives:

• Attract and retain highly qualified top management
• Align the long-term interests of top management and company shareholders

KPMG scope of work:

• Consider motivation issues and develop the main parameters of the plan: eligibility, exit and entry terms, plan cycles, vesting period, share price (if applicable), size of incentive opportunity, etc.
  
• Develop the legal structure for incentive plan implementation
• Assess tax implications of plan implementation
• Develop models to calculate payouts under the plan
• Design a set of legal documents (policies, regulations, employment contracts, etc.)

Employee Satisfaction Surveys

Objectives:

• Reduce employee turnover
• Receive employee feedback on various aspects of certain management actions to assist in the development of strategies and policies

KPMG scope of work:

• Conduct employee satisfaction survey to explore:
  
  • Employee satisfaction with corporate culture, career growth opportunities, compensation and benefits, terms of hire, etc.
    
  • Employee readiness for major change (e.g. attitude to forthcoming merger)
• Interpret survey results for utilization during the implementation of new C&B elements, HR policy adjustments, etc.
  
• Develop recommendations and a plan of action based on survey results

Remuneration Surveys

Objectives:

• Compare and analyze target market salary levels and benefits
• Implement best market practice (Russian and/or international) in the C&B area

KPMG scope of work:

• Determine a peer group to be surveyed and enroll companies in the survey
• Develop and distribute questionnaires
• Collect data, analyze gathered information, prepare a report
• Develop recommendations and a plan of action based on survey results