Compensation  management NKT thane colg ....TYBMS 2013
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Compensation management NKT thane colg ....TYBMS 2013



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Compensation  management NKT thane colg ....TYBMS 2013 Compensation management NKT thane colg ....TYBMS 2013 Presentation Transcript

  •  Human Resource is the most vital resource for any organization.  It is responsible for each and every decision taken, each and every work done and each and every result.  Employees should be managed properly and motivated by providing best remuneration and compensation as per the industry standards.  The good compensation will also serve the need for attracting and retaining the best employees. . Introduction
  •   Compensation is the remuneration received by an employee in return for his/her contribution to the organization.  It is an organized practice that involves balancing the work-employee relation by providing monetary and non-monetary benefits to employees Compensation
  •   When managed correctly, it helps the organization achieve its objectives and obtain, maintain, and retain a productive workforce.  Compensation is a key factor in attracting and keeping the best employees and ensuring that your organization has the competitive edge in an increasingly competitive world.  Without adequate compensation, current employees are likely to leave and replacements will be difficult to recruit.  The outcomes of pay dissatisfaction harm productivity and affect the quality of work life. Cont.….
  •     Compensation Management
  •  Compensation provided to employees can direct in the form of monetary benefits and/or indirect in the form of non- monetary benefits known as perks, time off, etc.  Financial Compensation: Total Financial compensation = Direct + Indirect Compensation  Direct Financial Compensation – pay received in forms of wages, salaries, bonuses and commissions , fringe benefits Types of compensation
  •  Fringe benefits described as  Welfare expenses  Wage supplements  Perquisites other than wages  Sub wages  Social charges Fringe Benefits
  •   Indirect Financial Compensation(benefits) - All financial rewards not included in direct compensation. For examples workers compensation, Family & medical leave, Disability Protection,  Nonfinancial Compensation - Satisfaction person receives from psychological & or physical environment in which person works. For examples, skills variety, experiences, good working conditions, flextime Types of compensation (contd..)
  •   A good compensation package is important to motivate the employees to increase the organizational productivity.  Unless compensation is provided no one will come and work for the organization. Thus, compensation helps in running an organization effectively and accomplishing its goals.  Salary is just a part of the compensation system, the employees have other psychological and self-actualization needs to fulfill. Thus, compensation serves the purpose.  The most competitive compensation will help the organization to attract and sustain the best talent. The compensation package should be as per industry standards Need of Compensation Management
  • Objective Of Compensation Management Compensation Package Motivation Need Satisfaction Employee Retention
  •   To help the organization achieve strategic success while ensuring internal and external equity.  Internal equity- ensures that more demanding positions or better qualified people within the organization are paid more.  External equity - assures that jobs are fairly compensated in comparison with similar jobs in other firms  Attract qualified personnel  Retain current employees  Reward desired behaviour  Facilitate understanding Cont.…
  •   Internal Factors:  Employers Compensation strategy  Worth of a Job  Employees Relative Worth  Employers Ability to Pay DETERMINING COMPENSATION
  •   External Factors:  Labor Market Conditions  Area Wage Rates  Cost of Living  Collective Bargaining Cont.……
  •   Wage and Salary Surveys  Collecting Survey Data  The Wage Curve  Pay Grades  Competency Based Pay The Compensation Structure
  •   Payment of Wages Act, 1936  Industrial Dispute Act, 1947  Minimum Wages Act, 1948  Equal remuneration Act, 1976  Payment of Bonus Act, 1965  Wage Board Governmental Wage Policy of India
  •   Wage boards consist of an impartial chairman , two other independent members and two or three representatives workers and employers each  The recommendations of the board are first submitted to the government for the acceptance  After acceptance the government requests the parties to implement them. Wage boards
  •   To establish good labor relations.  To decide on appropriate wages  To decide wages based on individual’s capability  To develop a pre-determine scheme for payment of wages  To establish linkages of wages payment with performance  To provide for incentive payment  To guarantee minimum wages  To provide for neutralization of price rise  To develop a wage structure which can attract talent Objective Of A Good Wage Policy
  •   The Issue of Equal Pay for Comparable Worth  The Issue of Wage Rate Compression  Living Wage Laws  The Issue of Low Salary Budgets Compensation Issues