Wage and salary administration in hotel industry

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Wage and salary administration in hotel industry

  1. 1. Wage and salary administration in Hotel industry :- Anubhuti Anup Gaurav Talwar Ghanshyam Burnwal Ranabir Pal
  2. 2. Agenda• Overview• Objectives• Factors influencing wage and salary structure and administration• Wage and salary administration in – TAJ hotels
  3. 3. Overview• A salary administration program provides the means for management to: – Properly analyze and evaluate positions – Provide equitable and competitive remuneration – Appraise individual performance in the position• Salary administration committee Chairperson Secretary Members
  4. 4. Objectives• Wage and salary ranges Flexible• Wage and salary adjustments• Job evaluation – Must be scientifically done – Consistent with organizations policy
  5. 5. Factors influencing wage and salary administration • The organizations ability to pay • Supply and demand of labour • The prevailing market rate • Living wage • Trade unions bargaining power • Job requirements • Psychological and sociological factors • Levels of skills available in the market
  6. 6. TAJ hotels• The Indian Hotels Company Limited (IHCL) and its subsidiaries are collectively known as Taj Hotels Resorts and Palaces• Founded on 16 December, 1903 by Mr. Jamsetji N. Tata• Asia’s largest and finest hotel company• Includes- – Taj – Taj Exotica – Taj Safaris – Vivanta by Taj Hotels & Resorts – The Gateway Hotel – Ginger
  7. 7. God’s own secret in God’s own country
  8. 8. Wage & Salary Administration• Low (30- 40% lesser than industry’s average)• But perquisites, incentives, bonuses, and employee oriented activities are higher• Salary break up General manager- at least 2 lakhs HOD- 50k to 1 lakh Deputy HOD- 30k to 50 k Manger- 22k to 30k Assistant manager- 15k to 20k Supervisor- 5k to 15k Front line worker- 5k to 8k
  9. 9. Basis of evaluation• Performance based increments – Three-day off-site assessment• No of years spent- 15% increase• Job security• Quarterly KPI’s (Key Performance Indicators)• Target (scale of 5)• Guest feed back, supervisor’s recommendation
  10. 10. Salary of typical assistant manager • Basic 9000 • HRA 1800 • LTA 10000(leave/travel allowance) • Medical 15000 • Provident fund 1200 • Gratuity –given for 5 yrs of continuous service
  11. 11. Overview• ITC’s Hotel division was launched on October 18th,1975• Its first Hotel – Chola Sheraton in Chennai• It is one of India’s finest chain of hotels• Its objectives
  12. 12. Wage and Salary administration• ITC has segregated all their employees and put them in their respective heads like accounts, administrative, purchase, sales, etc• ITC uses salary heads like – Basic, HRA(50% of Basic), Conveyance allowance, Education allowance(staff’s kids), PF
  13. 13. Cont…• ITC offers relatively high packages• Incentives and perks offered are very high• ITC provides for varied compensation packages
  14. 14. Average Salary offered to Top Management Employees in ITC
  15. 15. Cont…• Work Hours: 6 days/week, 9 hours/day• Employee is entitled for overtime if he/she is of a rank of supervisor or below• Employee is given • 7 CL & 7 SL • 22 days compulsory PL in a year with a 3 year roll back• Employee provided with • PF, Family Hospitalization Assistance Scheme, Accident Relief, Emergency Relief
  16. 16. Overview Of the• The Oberoi group founded by Late Rai Bahadur Mohan Singh Oberoi in 1934• Currently Mr.P.R.S.Oberoi is the Chairman of The Oberoi Group and his son; Mr.Vikram Oberoi and his nephew, Mr.Arjun Oberoi serve as Joint Managing Directors• Broadly they have two principal brands - THE DELUXE OBEROI BRAND and THE FIRST CLASS INTERNATIONAL TRIDENT BRAND• Distinctly operating 28 hotels and three cruisers in five countries under the luxury ‘Oberoi’ and five-star ‘Trident’ brands• Internationally recognized for all-round excellence and unparalleled levels of service
  17. 17. Wage & Salary Administration• Wage survey, wage plans and job evaluation are the three important methods used for this purpose• The aim of a wage and salary policy is to recognize the value of each job, provide stability in earning, allow individuals to reach full earning potential and to ensure that all staff share in the organizations prosperity• Fixing the compensations levels taking into consideration various factors like experience, identical industry knowledge, qualifications and proven skills.
  18. 18. System to achieve the objectives• Job Evaluation• Wage, Benefits and Salary Range• Wage and Salary Adjustments
  19. 19. System to achieve the objectives• Job Evaluation – It includes selecting suitable job evaluation techniques, classifying jobs into various categories and determining relative value of jobs in various categories• Wage and Salary Range• Wage and Salary Adjustments
  20. 20. System to achieve the objectives• Job Evaluation – It includes selecting suitable job evaluation techniques, classifying jobs into various categories and determining relative value of jobs in various categories• Wage, Benefits and Salary Range – Each job grade will be assigned a salary range • As Manager • As a STEP Trainee• Wage and Salary Adjustments
  21. 21. System to achieve the objectives• Job Evaluation – It includes selecting suitable job evaluation techniques, classifying jobs into various categories and determining relative value of jobs in various categories• Wage, Benefits and Salary Range – Each job grade will be assigned a salary range • As Manager – The median expected salary for a typical Hotel Manager in the Oberoi Hotels is $95,156 • As a STEP Trainee• Wage and Salary Adjustments
  22. 22. System to achieve the objectives• Job Evaluation – It includes selecting suitable job evaluation techniques, classifying jobs into various categories and determining relative value of jobs in various categories• Wage, Benefits and Salary Range – Each job grade will be assigned a salary range • As Manager • As a STEP Trainee – A starting stipend of Rs 3,500 in Year 1, which increases in subsequent years – 3 weeks of study leave and 3 weeks of home leave – coverage under the hotel medical scheme – a monthly telephone allowance – shared hostel accommodation with security – pick-up and drop when safe local transport is not available and – meals as required• Wage and Salary Adjustments
  23. 23. System to achieve the objectives• Job Evaluation – It includes selecting suitable job evaluation techniques, classifying jobs into various categories and determining relative value of jobs in various categories• Wage and Salary Range – Each job grade will be assigned a salary range • As Manager • As a STEP Trainee• Wage and Salary Adjustments – Overall salary grades of the organization may be adjusted based on the data and information collected about the salary levels of similar organizations – Wages Policy
  24. 24. Principles of Wage and Salary Administration• Wage and salary plans and policies should be sufficiently flexible• Wage and salary administration plans must always be consistent with overall organizational plans and program• Wage and salary administration plans and programs should be in conformity with the social and economic objectives of the country like attainment of equality in income distribution and controlling inflationary trends
  25. 25. Principles of Wage and Salary Administration• Wage and salary plans and policies should be sufficiently flexible• Wage and salary administration plans must always be consistent with overall organizational plans and program• Wage and salary administration plans and programs should be in conformity with the social and economic objectives of the country like attainment of equality in income distribution and controlling inflationary trends
  26. 26. Principles of Wage and Salary Administration• Wage and salary plans and policies should be sufficiently flexible – Mar 18, 2008: HC asks Oberoi Hotel to pay Rs 60,000 to former employee (Source: The Economics Times)• Wage and salary administration plans must always be consistent with overall organizational plans and program• Wage and salary administration plans and programs should be in conformity with the social and economic objectives of the country like attainment of equality in income distribution and controlling inflationary trends
  27. 27. Principles of Wage and Salary Administration• Wage and salary plans and policies should be sufficiently flexible• Wage and salary administration plans must always be consistent with overall organizational plans and program – The Oberoi group of hotels as operated in 5 Countries, the salary structure is almost similar• Wage and salary administration plans and programs should be in conformity with the social and economic objectives of the country like attainment of equality in income distribution and controlling inflationary trends
  28. 28. Principles of Wage and Salary Administration• Wage and salary plans and policies should be sufficiently flexible• Wage and salary administration plans must always be consistent with overall organizational plans and program• Wage and salary administration plans and programs should be in conformity with the social and economic objectives of the country like attainment of equality in income distribution and controlling inflationary trends
  29. 29. Challenges faced in Wage and Salary administration Employee Participation Skill Based Comparable Pay Worth Wage and Salary Salary Pay Secrecy review
  30. 30. Overview• Founded in 1994• MD and Founder : Anil Madhok• Headquarter : Mumbai, India• 4th largest hotel chain in India• The Company manages and franchises 56 hotels across 39 destinations in India and overseas• Brands: Sarovar Premiere, Sarovar Portico, Hometel, Park Plaza and Park Inn• The brands cover the 3, 4 and 5 star spectrum
  31. 31. Salary & Wage Administration• Basic (25% of Total Salary) + House Rent Allowance (25% of Total Salary) + Special Allowance (30% of Total Salary) + City Allowance (20% of Total Salary)• Fooding and Lodging is provided by the company• Leaves
  32. 32. Cont…• Pay Scale Increment – Parallel Growth – Vertical Growth – Re-evaluating the Pay Scale
  33. 33. Cont…• Parallel Growth – Normal increment in Gross Salary each year : • A – 15% • B – 13% • C – 10% • D – Nil (Beware!!!) – Factors influencing this growth: • Guest Comments • Performance
  34. 34. Cont…• Vertical Growth – After 2-3 years – Factors influencing this growth: • Experience • Qualification• Re-evaluating the Pay Scale – Normally done after every 3 years
  35. 35. Cont…• Leaves – National Holiday – Weekly 1 leave• Extra Work Compensation – National Holidays • Compensatory Off afterwards • Extra Payment – Weekly Holidays • Compensatory Off afterwards
  36. 36. Cont…• Lodging & Fooding – As per Minimum Wage Act – Follows the Minimum Wage Act of the State or Country, whichever is applicable• Others – Lower management and Middle management people cannot visit the hotel as a customer – This rule is applicable even after leaving the job
  37. 37. Welcome Again

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