Compensation of Tel com industry

1. Literature Review
Conceptual approach:
The literal meaning of compensation is to counter balance (Prasad LM, 2005). In case of
Human Resource Management, compensation refers to ―money and other benefits received
by an employee for providing services to its employer.
Cascio (Cascio WF, 2003) opines that because of the importance that compensation holds for
people's lifestyle and self-esteem, individuals are very concerned about what they are paid – a
fair and competitive wage, while organizations are also concerned about what they pay
because it motivates important decisions of employees about taking a job, leaving a job and
on the job performance.
The concept of employee compensation and benefits cannot be discussed in a vacuum.
Various studies have established that salaries and benefits are closely related to job
satisfaction (Odunlade RO, 2004); and job satisfaction can bring about motivation which in
turn affects employee job performance and organizational commitment.
Compensation Strategies
Compensation strategy includes rewards, benefits, career growth opportunities, working
environment and all other things which generate value to employees in return for their
performance and it should be aligned with human resource management, business level and
organizational development strategies for attaining whole organizational strategic objectives
(Milkovich, 1987; Kaplan, 2007; Che'nevert and Tremblay, 2009). Organizations formulate
reward strategy to achieve its' short and long-term goals through cost saving and producing a
maximum result on assumed payment strategy; and make a brand for the employment
opportunity in the competitive market (Jiang et al., 2009). While designing pay policies,
organizations make their own choices for specific policies, strategies, principles, structures
and procedure based on their perspectives and approaches after considering the impact of
those significant decisions on overall organizational performance (Lawler, 1981; Milkovich
and Newman, 1987; Bob, 2011). Being similar in nature of jobs, employees, market, size, and
so on, different organizations may choose different compensation system to ensure separate
effectiveness for achieving the similar type of goals after realizing the degree of
consequences of different pay design (Ehrenberg and Milkovich, 1987). Recently many
organizations are generating their own innovative reward strategies which are related to

2. organizational performance (Phillips and Fox, 2003) and managers are also measuring the
lead or lag position of reward strategies in the market while making decisions for pay
strategies (Weber and Rynes, 1991).
Compensation Objectives
The efficient practice of pay structures has a great impact on successful recruitment and
selection, employee motivation, turnover, employee commitment to the workplace (Brown,
Sturman and Simmering, 2003; Bright, 2008; Moncraz, Zhao and Kay, 2009), employees'
behavior, productivity, performance level and stability (Bustamam, et al., 2014; Greene,
2014), overall organizational performance and persistent competitiveness in the market
(Stajkovic and Luthans, 2001; Jenkins, Mitra, Gupta and Shaw, 1998), along with
maintaining an effective and efficient cost structure (Mello, 2011; Phillips and Fox 2003).
Equitable compensation system enables an organization to attract, motivate and retain best
employees and thus stable and skilled employees ensure successful implementation of
organizational strategies to enhance the business growth (Arbaugh et al., 2004; Rynes,
Gerhart and Parks, 2005). There is a correlation between compensation and employees' job
satisfaction (Nelson, et al., 2008). Job satisfaction is also positively related to pay, promotion,
security, challenging work and interesting job (Salisu, Chinyi and Suresh 2015). Other
organizational outcomes like sales growth, better customer satisfaction, cost reduction and
improve employee safety situation (Werner and Ward, 2004; Onukwube, 2012).
Compensation Policies and Techniques
To develop a suitable salary range, organization should focus on competitors pay data
(Pfeiffer and Sutton, 2006) along with the evaluation of other compensation features like
sacrificed pay in other organization, individual contribution, duties and responsibilities,
educational requirement, level of experience, productivity, internal equity, effectiveness and
so on (Glassman, 2010; Terpstra and Honoree, 2005). A market survey is important to ensure
external equity (Dulebohn and Werling, 2007; Milkovich and Newman, 2008). Market
assessment is essential for getting information about other organizations' methods of payment
to arrange a fair and justifiable pay level, mix and select a mode of rewards like individual or
group, performance or seniority base and others (Milkovich, 1987). Assessment of external
alignment helps in arranging strategic compensation packages along with increased benefits
and decreased costs to strive in the market (Kaplan, 2007; Sturman and McCabe, 2008).
Organizations can use both pay survey and job evaluation data to create a market line after

3. plotting data on a graph to get the trend line through regression analysis. Then organizations
develop their pay structures by accumulating several jobs into pay grades and generating pay
ranges (Mathis and Jackson, 2005).
Objectives of the Study
The study's major aims were:
 To identify the industry's overall compensation plan.
 Identify the mapping of the industry's overall compensation plan.
 Identify the industry's job analytical methodologies.
 Identify the industry's overall performance management systems.
 Study the wage structure of the industry followed.
 The industry can enhance the identification of employee pay practices.
Methodology
The report is separated in two sections, methodologically speaking. The study highlights
several aspects relating to compensation strategies in its descriptive section. We seek to link
the Bangladeshi telecommunications industry's entire compensation plan to the 'Pay Model.'
Various secondary sources were consulted in this portion. In its final section, however, data
from 5 convenient industrial samples have been collected. The sample is selected using non-
random sampling techniques. Data analysis provides a description of this sector's Total
Compensation Strategy, Strategic Map, pay structure and employment analysis methodologies.
Data sources
Because of the current pandemic scenario, all of the material in this article has come only
from secondary sources. Observation methods were used to acquire certain data and
information. Other than the primary facts, secondary data is gathered for the same objective.
Secondary data are an easy way to get background information. We gathered information
from secondary sources. The following are the sources:
Internet
Financial statements
Previous reports on HR of various telecommunication companies.

4. Compensation System Practices in Telecommunication Industry in Bangladesh
Within a global economy, one microeconomic element has been and will continue to be
essential. The element at question is labor expenses. Labor cost concerns have a negative
impact on the efficiency and even survival of public and private sector organizations. Long
before the notion of a global economy was introduced, governments used different techniques
and endeavors to redistribute money to the disadvantaged sections of their community. It has
been observed that if the poor are not given with a subsistence level of income or required
goods and services, a hostile society emerges with continual fighting between the "haves" and
the "have nots." One significant technique of caring for the poor advocated government benefits
in the form of money, food, shelter, health care services, and even clothes. Another option was
for government entities – Civil Service – to offer employment and pay checks linked to those
jobs.
Compensation Management outlines a step-by-step procedure for developing a pay system that
takes into account:
 Job requirements;
 Employee-related knowledge and abilities; and
 Monthly guaranteed cash and permitted variable components.
 Annual cash and non-monetary benefits (depending on eligibility) as well as long-
term/deferred benefits
To determine an attractive compensation system, they consider cash and non-cash benefits,
internal and external equity, competitiveness, consistency, performance-based pay, and so on,
in light of the Company's strategic objectives and the unique characteristics and environment
prevailing in the Telecommunications industry in Bangladesh. Individual, team, work unit, and
organizational performance are all linked through performance incentives. Total compensation
also includes a slew of perks that safeguard and enhance workers' and their families' lifestyles
and health.
Findings and Discussions
The findings of the study have been examined under the following headings.
Compensation & Benefits

5. Bangladesh's telecommunications sector has a performance-based pay system that
compensates employees based on their performance and job productivity. These sorts of
compensation and benefit arrangements were used by the telecommunications sector to service
their employees.
Base Pay: Bangladesh's telecommunications sector is job-based and compensates its
employees on a per-job basis. Their basic salary has been determined based on their tasks and
obligations completed, as well as their job content, attitude, and responsibilities. To develop
this structure, Bangladesh's telecommunications sector conducts surveys to compete with
others in the industry, such as work analysis, assessment, and control, market trends, employee
job descriptions, surveys, policy lines, and so on.
Food Subsidy: The telecommunication industry in Bangladesh compensates its top executives,
executives, management trainees, and so on Tk. 65K-95K, as well as assistant manager and
above Tk. Allowance for meals is around TK 160 – TK 200.
Increments: This industry's advancements are entirely reliant on the performance of the
personnel and their seniority level. If the pay scale is Tk. 15000-20000, the increment is 20%
of the base pay, but if an employee performs well, this can grow to 35% to 50% of the base
pay.
Recognition of the Work: Employees who have worked in Bangladesh's telecommunications
business for seven or more years receive monetary prizes, trophies, medals, and other
incentives.
Medical Allowance: In Bangladesh's telecommunications business, each employee receives
one gross pay each year, half of which is paid in the middle of the year and the other half at
the end.
Health Insurance: Bangladesh's telecommunications business, like all other industries, offers
health insurance to its employees.
Loan Insurance: Loan insurance policies are also given to employees in Bangladesh's
telecommunications industry by banks.
Transport allowance: If they use local transportation, both male and female employees are
awarded Tk. 2500-4000.
House Rent: Each senior/executive level employee receives 10% of their base wage.

6. Overtime: Overtime is available to any workers who work more than on average 130 hours
per month. Every business in Bangladesh's telecommunications industry has its own particular
formula that applies to the employee's gross income, resulting in a distinct per hour overtime
rate for each employee.
Children education allowance: Every company in Bangladesh's telecommunications industry
pays one or two gross salaries each year.
Provident Fund: All permanent and confirmed workers of any business in Bangladesh's
telecommunications industry are eligible for membership in the Employee Provident Fund
Scheme. In a year, an individual contributes around 8-9 percent of his monthly basic pay, and
the company contributes a same amount.
Travel Policy: Staff at various levels, including senior, middle, and junior, enjoy travel perks
at each business in Bangladesh's telecommunications industry, which has been revised and
classified.
Meal deduction Claims: Each employee is required to keep a meal book. It bears the names
of the issuer and the issued, as well as the employee number, designation, signature, quantity
of books, and date of issue. The rationale for keeping the record is because the employer covers
60% of the meal expenditures, while 40% is taken from the employee's income.
Expense Claim: Expense claims are expenditures incurred by an employee on behalf of the
firm, such as gasoline for business travel, overnight lodging on a business tour, and so on. Such
allegations are made on the way back to the office. Next the completion of the process, HR
reimburses them together with their income the following month.
Overtime Claim: If an employee works more than his normal shift, he is entitled to overtime
compensation in addition to his income, which he receives the following month. The HR
department must authorize any overtime claims.
Medical Claim: Employees at various levels of the hierarchy are supplied with a variety of
medical services. So, if an employee uses this service, he will submit a bill along with hospital
receipts, and the HR department will review and clear the bills/claims.
Mobile deduction Claim: If an employee makes long-distance calls for official purposes and
thereby exceeds the limit, he can file a claim by attaching a copy of the cell bill. It will be

7. reviewed, and if determined to be genuine, the HR department will authorize it and pay the
employee's claim together with his monthly income the next month.
Dispatching Salary Slips: The vendor produces the salary slips and delivers them to the HR
department, which then distributes them to the regional HR departments. They either pay their
staff in cash or deposit the funds into their bank accounts.
Total Compensation: In any firm in Bangladesh's telecommunications industry, the entire
compensation is offered as basic pay 60%, home rent 30%, and allowance 10%.
Salary Structure
Every telecommunications firm in Bangladesh performs its own market study and compares
its standards to those of other telecoms companies, notably Grameenphone, Banglalink, Axiata
(Robi), Airtel, and Teletalk. Pay grades and salary ranges are part of the company's salary
structure. It is determined by the relative worth of each job. The firm is aware of the
employment evaluation procedure as well as competitive market practices. The existence of
structure allows for variations in performance and incentives at various wage levels. To
preserve the competitiveness of the wage structure, the firm analyzes its salary range every
year in accordance with the results of a market study. It is determined by how competitive the
firms are in the overall market. The criterion used by the firm to determine an employee's
compensation comprises the following:
 The workers' associated abilities, knowledge, and experience;
 The employee's performance pattern throughout time compared to the present year;
 Pay equity both inside and outside; and
 Salary connections in which the employee's basic pay is compared to others in the
department performing comparable tasks.
The concept of every firm in Bangladesh's telecommunications sector is to "Pay or
Performance," by comparing primarily with other Telecom companies, the industry, and multi-
national consumer goods corporations. Their compensation structure is set at 80% of the
market, and their benefits are also set at 80% of the market. For example, if an employee does
not work for the entire month, his or her compensation for that month will be prorated. Every
employee is paid on the 30th or 31st of each month. If the payday falls on a holiday, the day
prior will be considered payday.
Salary Breakdown

8. Position
Monthly
Pay/month in BDT
Base pay/month in
BDT
Additional
pay/month in BDT
General Manager 423K - 464K 327K - 356K 99K - 109K
Deputy General
Manager
233K - 467K 231K - 314K 142K - 151K
Senior Human
Resources Business
Partner
369K - 395K 242K - 259K 127K - 138K
Senior Product
Manager
216K - 235K 217K - 235K 50K – 40K
Human Resources
Business Partner
155K - 169K 93K - 100K 64K - 70K
Business
Development
Manager
76K - 82K 77K - 83K 54K - 70K
Financial
Accountant
127K - 137K 74K - 79K 54K - 58K
Manager 62K - 68K 62K - 67K 25K – 28K
Senior Territory
Manager
65K - DT 69K 50K - 54K 14K - 16K
Executive 50K – 44K 44K – 38K 25K – 35K
Job Evaluation Method
In Bangladesh's telecommunications business, job assessment is based on an appraisal system.
When an employee's appraisal report is prepared, he gets compensated based on his
performance. Appraisal reports are used to evaluate the job. If a position becomes available,
the previous performance in that position is assessed, as are market conditions, before the job
is finally appraised. The job's worth is considered, as is the performance report. The worth of
any work might be raised if an employee in a certain position has done very well and his
evaluation report is superb. This procedure is carried out by the company's HR department.
Furthermore, job appraisal is connected to merit. Anyone who is hired on merit and performs
admirably will be paid a wage commensurate with his or her abilities.
Steps of Job Analysis

9. Companies adopt the following steps:
Step 1) Gather documentation, such as process manuals and written instructions.
Step 2) Inquire about more broad aspects of the work, such as the job's goals and
primary activities.
Step 3) Inquire about the position with the jobholders.
Step 4) Pay attention to the jobholders to discover what they truly do.
Performance Management System
The performance evaluation approach that organizations use to examine the performance status
of their employees begins with defining particular appraisal goals established by each group
for each cadre. Following that, a detailed job analysis is performed, taking into consideration
work expectations and then comparing actual performance to intended performance.
Rewards Related to Performance
There is also a reward based on employee performance. “Customer Facilitation Agents” earn
50% of their salary based on their performance, which is evaluated monthly by their managers.
Other personnel in administration, engineering, finance, marketing, and so on have their
performance evaluated every six months, and they are frequently given a pay increase of
approximately Tk. 5000 as a reward. In each situation, the individual must demonstrate
consistent performance to be rewarded the following time.
Performance appraisal: 180°
Behavior 20%
Results 80%
Total 100 %
Total 500 Marks
Best >400
Good >300
Total Compensation Strategy of Telecommunication Companies in Bangladesh
Objectives

10. Support the company's goals. As an Equal Opportunity Employer, we encourage recruitment
motivation. They will provide equal opportunity to everyone, regardless of race, religion, color,
gender, creed, national origin, age, disability, or handicap status. All line supervisors must
maintain track of their employees' attendance. Maintain the company's basic objectives. The
firms have given the most cutting-edge network with numerous features.
Internal Alignment
 An essential component of the company's corporate culture.
 Encourage a performance-driven culture.
 Organizational design structure that is sophisticated and technologically based.
Externally Competitiveness
Pay is market rate, although competitiveness and salary structure are updated annually. The
philosophy is "Pay or Performance," which means meeting basic pay and bonuses.
Contributory provident funds are available to all regular workers. After successfully
completing the 90-day probationary period, the provident fund will be withdrawn at a rate of
9% of the base pay every month.
Employee Contribution: Bonuses and pay increases are determined by current employee
performance and position.
Management
 Always be upfront, transparent, and fair.
 Administration has been centralized.
 Supported by modern technologies.
Compensation Responsibilities of HR Department
Administration of Compensation (designing and installing job evaluation program, pay
structure, analyzing jobs and their BDT-worth, maintaining suitable records, wage and salary
surveys of the labor market). Safety and Health (health programs, safety programs, medical
facility). Relationships between employees (wages, rates of pay, hours of work, conditions of
employment, negotiation, contract interpretation and administration, grievance handling,
allocation of overtime). Services and Benefits (insurance programs, transportation facility, sick
leave pay plans, loan funds, LFA salary, yearly bonus programs along with special bonuses for
achieving high targets).

11. Employee Compensation Practices Can be Improved in Telecommunications Industry
in Bangladesh
The HR manager voiced their opinions on personnel recruited by third parties and working in
the company on a contractual basis, saying, "we don't want them; thus, we aren't obligated to
reward them similarly in comparison to our permanent employees." According to Labor Law
2006, the contractual employees must be appropriately compensated.
This industry employs a large number of contract workers. They account for more than 55%
of the total size of this industry. Furthermore, not all of those employees are pleased because
of these criteria, but they are also an important part of the business; they are stressed with
their job because they just receive a wage, no perks, or any other compensation tools for their
efforts. This demonstrates that there is a lack of motivation among contractual employees,
which may result in an increase in turnover rate. These factors raise the cost of new employee
recruiting and training. This staff churn can be fulfilled if the industry takes steps to pay and
reward them. The industry should establish certain ground rules for all of its members.
Another significant observation from the perspective of Human Resource practices is that the
idea of relational return in the organization is not particularly satisfactory, despite the fact that
this is extremely essential in businesses such as Robi, Airtel, and Teletalk. The relational return
must be rebuilt in order to incentivize workers to stay with the business.
Companies have some issues with their payroll; the company has a large number of workers,
but there are only a few executives that work on the payroll and remuneration. As a result, there
are several difficulties in running the payroll properly and equitably compensating everyone
based on their performance. Organizations must expand the number of executives in order to
create the greatest compensation model in the industry.
The telecommunications sector should focus on contractual employees and inspire them by
appropriately rewarding them and making them aware that what they are getting is enough.
Companies must offer them with the required benefits, bonuses, and incentives based on their
job description.

12. To recruit and retain the most valued personnel, the telecommunications sector should
implement some career development initiatives. Employees will be motivated and loyal to a
company if they believe they have opportunities for advancement.
The Human Resources Department must also predict long-term Human Resource requirements.
It was also discovered that contractual employees who were qualified, skilled, and
knowledgeable applicants received no recommendation incentive. The HR Department must
persuade upper management to provide such a bonus, which will not only encourage employees
but also allow the business to hire qualified, skilled, and experienced workers. They will, in
turn, contribute to the organization's success.
These organizations' HR departments must explicitly disclose their promotion policies to all
workers.
Conclusion and Recommendation
Pay and benefits are extremely important to both new applicants and existing employees. The
compensation received from work is a major reason that most people seek employment.
Compensation not only provides a means of sustenance and allows people to satisfy their
materialistic and recreational needs, it also serves their ego or self-esteem needs. Consequently,
if a firm's compensation system is viewed as inadequate, top applicants may reject that
company's employment offers, and current employees may choose to leave the organization
considering so many factors which needs to be cared off.
The goal of the telecommunication and the pharmaceuticals industries of Bangladesh is to be
indisputable leader in the field of world class telecommunication and pharmaceuticals
companies, as these two industries already leading the position in GDP contribution of
Bangladesh. To achieve this goal, these industries have to develop a global set up for each
operating country office with local competencies. Keeping this target in mind, they realize the
indispensable need of identification of potential employees and placing the right people to the
right position and motivate them accordingly through a competitive compensation package
offered to them. They recognize that only those people can achieve their goals whose
potentiality is well identified by the company. A standard compensation package process is
thus playing an important role for this telecom industry in Bangladesh. In a conclusion note
this is just to mention that the organizations can conduct an “Employee Satisfaction Survey”
every year to understand their perception and expectation in the light of Total Compensation
System Process.

14. Prasad LM; Human Resource Management, New Delhi, S. Chand Publication, 2005.
Cascio WF; Managing human resources: Productivity, Quality of work life, profits. 6th
edition, McGraw Hill Higher Education, New York, 2003.
Odunlade RO; Managing employee compensation and benefits for job satisfaction in library
and information centers in Nigeria. 2004.
Brown, M. P., Sturman, M. C., and Simmering, M. J. (2003). “Compensation Policy and
Organizational Performance: The Efficiency, Operational, and Financial Implications of Pay
Level and Pay Structures”, Academy of Management Journal, Vol. 46(6): 752-762
Bustamam, F. L., Teng, S. S. and Abdullah, F. Z. (2014). “Reward Management and Job
Satisfaction among front Line Employees in Hotel Industry in Malaysia”, Procedia—Social
and Behavioral Sciences, Vol. 144: 392-402
Stajkovic, A. D. and Luthans F. (2001). “Differential Effects of Incentive Motivators on Work
Performance”, Academy of Management Journal, Vol. 44 (3): 580-590
Mello, J. A., 2011, “Strategic Management of Human Resources (3rd Ed.)”,
Cengage Learning India Private Limited.
Arbaugh, B., Camp, S. M. and Cox, L. W. (2004). “Employee Equity, Incentive
Compensation and Growth in Entrepreneurial firms”, New England Journal of
Entrepreneurship, Vol. 7(1).
Nelson, M. F., Stone, T. H., Frye, C. M. and Chown, D. W. (2008). “Pay Me More: What
Companies Need to Know About Employee Pay Satisfaction”, Compensation Benefits Review,
Vol. 40 (2): 35-42
Salisu, J. B., Chinyio, E. and Suresh, S. (2015). “The Impact of Compensation on the Job
Satisfaction of Public Sector Construction Workers of Jigawa State of Nigeria”, The Business
and Management Review, Vol. 6(4)
Werner, S. and Ward, S. G. (2004). “Recent Compensation Research: An Eclectic Review”,
Human Resource Management. Review›, Vol. 14: 201— 227.
Pfeiffer, J. and Sutton, R. (2006). “Evidence Based Management”, Harvard Business Review,
63-74.

15. Glassman, M., Glassman, A., Champagne, P. J. and Zugelder, M. T. (2010). “Evaluating Pay-
for- Performance Systems: Critical Issues for Implementation”, Compensation & Benefits
Review, Vol. 42.
Dulebohn, J. H. and Werling, S. E. (2007). “Compensation Research Past, Present, and Future”,
Human Resource Management Review, Vol. 17: 191-207.
MiIkovich, G. T. (1987). “A Strategic Perspective on Compensation Management”, Center for
Advanced Human Resource Studies (CAHRS) working paper series, Vol. 15(1), Ithaca, N Y:
Cornell University.
Milkovich, G. T. and Newman J. M. (2008). “Compensation”, McGraw-Hill Irwin.
Kaplan, S. L. (2007). “Business Strategy, People Strategy and Total Rewards”, Benefits &
Compensation Digest, Vol. 44(9), 12-19.
Sturman, M. C.and McCabe, D. (2008). “Choosing Whether to Lead, Lag, or Match the Market:
Developing a Competitive Pay Strategy for a New Restaurant”, Journal of Human Resources
in Hospitality and Tourism, Vol. 7 (1): 85-97
Mathis, R. L. and Jackson, 1. H. (2005). “Human Resource Management (10th Ext.)”,
Thomson Asia Pte Ltd.
Che^nevert, D. and Tremblay, M. (2009). “Fits in Strategic Human Resource Management and
Methodological Challenge: Empirical Evidence of Influence of Empowerment and
Compensation Practices on Human Resource Performance in Canadian Firms”, The
International Journal of Human Resource Management, Vol 20(4): 738-70.
Jiang, Z., Xiao, Q., Qi H. and Xiao, L. (2009). “Total Reward Strategy: A Human Resources
Management Strategy Going with the Trend of the Times”. International Journal of Business
and Management, Vol. 4(11).
Lawler, E. E. (1981). “Pay and Organizational Development”. Adtlison-Wesley Publishing.
Bob, N. (2011). “Malting Employees Suggestions Count”, Journal of Personnel Management,
Vol. 17: 20-41.
Phillips, L. and Fox, M. A. (2003). “Compensation Strategy for Transnational Corporation”,
Management Decision, Vol. 41(5): 465-476.

16. Weber, C. and Rynes, S. (199t). “Effects of Compensation Strategy on Job Pay Decisions”,
Academy of Management Journal, Vol. 34.