Good news. Good choices.

People in a Meeting and Single Word Rewards

For many students, the study of compensation planning takes place mainly within a theoretical framework. There are limited opportunities to explore real consequences of designing and deploying pay systems.

How do performance pay choices work in ‘real-life’ situations? Fortunately, the team of employees led by the owner of Homestead Organics is able to provide us with a step-by-step example of the application of theory to reality.

Homestead Organics, located in eastern Ontario, started as a family based business dedicated to growing and developing sustainable agricultural products.

Click here to access Homestead Organics website.

As this particular company developed and expanded in size, so too did its profitability. Homestead Organics decided recently to share its good fortune with its employees by introducing an Employee Share Ownership Program (ESOP).

Click here to read the article on Homestead Organics’ ESOP implementation.

Both the article and the information from the website reinforce the importance of a high-involvement managerial strategy in the application of successful pay for performance systems. Further, the article provides us with an overview of the key elements that need to be in place from the beginning of the design process through to the delivery of returns to employees who have chosen to participate in this plan.

From theory to reality, this is indeed a good news story worth ‘sharing’!

Discussion Questions:

  1. What are the positive effects for employees as share-owners of Homestead Organics?
  2. How does the concept of share-owner differ from stock-holder in this case?
  3. What types of employee behaviours will this share-owner agreement reinforce in order to ensure continued success?
  4. How do you think the values of Homestead Organics influenced the decision to provide a share-ownership program for its employees?