Challenges for a good comp and ben in current indian scenario
HAVING A GOOD
BENEFITS IN THE
COMPANIES IN THE
PRESENT INDIAN CONTEXT
MANISHA KUNWAR, DEEPA MAKHIJA
RAHUL CHAUDHARY, JUANITA KASBE
ANKITA , BARKATUNNISA
HR BATCH, ITM SION
Brief about C&B
Evolution of India’s benefits System
Importance of Compensation
Challenges for C&B in Indian Scenario
Current Trends in C&B
Compensation Survey Report by Deloitte
Brief – Compensation and
Compensation - Direct or Indirect monetary
and non monetary rewards given to
employees on the basis of the value of the job,
their personal contribution, and their
performance. While making these payments
one should be alive to the governing legal
Million people go to work - Drive to acquire
money, prestige, powers......The Motivation
Compensation/ Money - Primary Motivator
Fastest changing field in HR to find new ways
of rewarding employees performances
Phase I ( s- s). This was when policy was based on two
principles, namely that employer–employee participation for long-
term funding is important and that it is the State’s responsibility
to provide health care and other benefits for the people
(especially government employees and the rural population).
Phase II ( s- This was when the first National Health
Policy was introduced to encourage private initiatives in health-
care service delivery, while at the same time widening access to
publicly funded primary health care. This mainly benefited the
Phase III (post The liberalization of the insurance sector in
order to provide new avenues for health financing and a
redefinition of the role of the State from being only a provider to
being a financier of health services as well (to cover the entire
Evolution of India’s Benefits
A Sound Compensation Strategy
Define your compensation philosophy.
Link compensation to your overall
Change the culture and reinforce it with
Reward the behaviours that drive the
Think total compensation.
Measure your return on invested payroll.
Challenges.....for Good C&B
Limited Talent, especially in emerging
economies or for “Hot Skills”
Managing workforce diversity
Aligning C&B to employee needs
Increased flexibility in C&B programs e.g.
with “Split pay requirements, flexible benefits
How to distribute scarce compensation &
Having a “Credible” performance management
system that support “Performance Based Pay”
Balancing the issue of:
Linking Rewards to Performance vs. Building a Team
Not getting on the bandwagon of what is the latest
C&B scheme / idea / strategy / tool....
But about identifying what is right for the organization,
strategy, competitive position & the contribution
What Should Company be Aware
of for a good C&B?
Link with Objectives and culture
Establishing pay for performance standard
Current Trends in C& B
Compensation is now viewed as the total “cost to
company,” (CTC) rather than an employee’s net pay
alone as it helps to understand the costs and the
Variable pay based on individual performance is the
norm, and a larger percentage of the Indian salary is
based on performance.
Organization performance also is factored in while
structuring salary increases.
Basic, guaranteed pay has seen a gradual reduction.
Benchmarking against organizations, both nationally and
internationally, has become common.
Employee stock options (ESOPs) that were, a few years back,
considered as valuable compensation components have
ceased to be so given the erratic nature of the stock market
and the lock-in periods.
Non-taxable benefits, which increased the net “take-home” of
an employee, are now subject to the Fringe Benefits Tax (FBT),
and so organizations are forced to take second looks at these
Retirement benefits are left to what is mandated by the
Pension benefits and other similar social security benefits are
not on the radar screen of compensation experts in India
today, but this component could be under significant
discussion and speculation in the coming years.