External factors such as the labor market, cost of living, labor unions, and government legislation influence employee remuneration. The labor market determines wages based on supply and demand of skilled labor. A rise in cost of living is offset by payment of dearness allowance. Strong labor unions are able to pressure employers to determine and revise pay scales. Various labor laws such as the Minimum Wages Act and Payment of Bonus Act regulate wages and provide employees benefits like minimum wages and bonus payments.

1. Factors Influencing Employee Remuneration

3. They can be categorized : External Factors Internal Factors

5. Cost of Living

6. Labour Unions

7. Government Legislations

8. The Society, and

10. A low wage may be fixed when the supply of labour exceeds the demand for it.

11. A higher wage will have to be paid when demand exceeds supply, as in the case of skilled labour

12. High remuneration to skilled labour is necessary to attract and retain them.

13. But exploitation of unskilled labour, like, for instance, paying niggardly wages because it is available in plenty, in unjustified.

15. Going rates are generally paid in the initial stages of plant operators.

16. Productivity of labour also influences wage fixation

17. Productivity can arise due to increased effort of the worker, or as a results of the factors beyond the control of the management, and the like.

18. From advance technology and more efficient method of production

19. Productivity has only a subordinate role in wage fixation.

23. for certain classes of persons employed in the industry. Protection against irregularity in payment of wages in a particular form and at regular intervals

24. the Minimum Wages Act, 1948

25. enabled central and state Government to fix minimum rates of wages payable to employees

26. the Payment of Bonus Act 1965

27. provides payment of a specified rate of bonus to employees in certain establishments.

28. Equal Remuneration Act, 1976 ,

29. provides payment of equal remuneration to men and women workers for same or similar work.

30. the Payment of Gratuity Act 1972