1. COMPENSATION
Compensation/ reward may be define as the money received in the performance
of work, in addition the many kinds of remuneration and services that
organization offer to their employee. Money is incorporated under direct
compensation, whereas reimbursement come under indirect compensation, and
may possibly incorporate life, health and accident insurance, pay for illness or
vacation, and the employer’s contribution to retirement.
Compensation can be an imbursement made on behalf of effort, a service
provided or a job done. It can be considered as the fruit for the hard work put in.
In some other sense, it also illustrated as a return, repayment, or disbursement
made for the damage done or injury causes.
Compensation is a tool used by management for a variety of purposes to further
the existence of the company. Compensation may be adjusted according the
business needs, goals, and available resources.
Compensation may be used to:
• Recruit and retain qualified employees.
• Increase or maintain morale/satisfaction.
• Reward and encourage peak performance.
• Achieve internal and external equity.
• Reduce turnover and encourage company loyalty.
• Modify (through negotiations) practices of unions.