Once a business is ready to grow, it hires qualified candidates to work. The type of compensation offered and any additional offerin will vary depending on the job. Why is it important for companies to select the correct type of compensation? If compensation and performance align, they both act as motivators for employees. Appropriate compensation for each job ensures employees make just enough money to keep them from leaving. The correct compensation for each job discourages employees from discussing compensation with one another. If compensation and performance are misaligned, they both will negatively motivate employees