COMPENSATION MANAGEMENT
Points to be discussed in the Lecture Sessions:
 Definition and objectives of Job Evaluation
Pro...
JOB
EVALUATION
JOB EVALUATION is the systematic process of analyzing and
evaluating jobs to determine the relative worth ...
 Process

of Job Evaluation.
Preparation of a job Evaluation Plan.
Job Analysis
Job Description and Job Specification

Se...
Techniques of Job Evaluation.
Non Quantitative techniques.
Ranking

Relative ranking
Paired Comparison.
Single Factor Ran...
Quantitative Techniques.
Point Rating Method.
Identifying a number of Compensable Factors and determining the degree to
w...
 CONCEPT OF WAGE AND SALARY ADMINISTRATION.
The Wage and Salary Administration maintains equity and
competitiveness in th...
Basic Wage Plans.
• Time Wage Plan.
•Piece wage plan
•Skill based pay
•Competency based pay.
•Broad banding.

Variable Com...
Executive Compensation.
Steps to design an effective executive compensation plan.
i. Review the existing executive compens...
Wage Differential:
…….Differences in wages paid for same or similar work because
of various reasons .
• Individual level.
...
Concept of Reward.
Extrinsic Reward
Intrinsic Reward.
Financial Rewards.
Nonfinancial Rewards.
Performance based rewa...
Non Monetary Incentives
 Recognition.
 A challenging assignment.
 Additional responsibility.
 Free gifts and free vaca...
Long Term Plans.
:
a. Annual Bonus.
b. Profit Sharing: Distribution plan, Deferred plan,
Combination plan.
c. Gain Sharing...
Employee Benefits
• Free or subsidized lunches.

•Study Leave.

•Medical facilities to the employee
and his family.

•Comp...
Modern Concepts in Employee Benefit Schemes.
 Golden Parachute: Continuation of the salary, Bonus and
perquisites, Retire...
THANK YOU
DEFINITION OF FACTORS USED IN RATING JOBS.
 Education
Training
Experience
Mental Efforts.
Physical efforts
Visual At...
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Wage and salary module iv

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Wage and salary module iv

  1. 1. COMPENSATION MANAGEMENT Points to be discussed in the Lecture Sessions:  Definition and objectives of Job Evaluation Process and techniques of Job Evaluation. Advantages and Limitations of Job Evaluation. Concept of Wage and Salary Administration. National Wage Policy. Concepts of Rewards. Types of Incentives plans. Employee benefits.
  2. 2. JOB EVALUATION JOB EVALUATION is the systematic process of analyzing and evaluating jobs to determine the relative worth of each job in an organization. …..Basis for compensation management. …..Job Evaluation is the rating of jobs to determine their position in the job hierarchy. The objectives of JE : •Determine the positions and place of a job. •Manage internal and external consistency in the compensations. •Ensure employee satisfaction with respect to the compensation. •Basis for classification of new or changed jobs.
  3. 3.  Process of Job Evaluation. Preparation of a job Evaluation Plan. Job Analysis Job Description and Job Specification Selection of Job Dimensions. Classification of jobs. Implementation of the evaluation. Maintenance.
  4. 4. Techniques of Job Evaluation. Non Quantitative techniques. Ranking Relative ranking Paired Comparison. Single Factor Ranking. 1. Analyzing Organizational Culture. 2. determining job dimensions. Job Classification or Grading 3. Defining Job grades. 4. Classifying jobs with the grade definitions. 5. Using inputs from employees, unions etc . 6. Freezing the grades and assigning monetary value to the key grades.
  5. 5. Quantitative Techniques. Point Rating Method. Identifying a number of Compensable Factors and determining the degree to which of these factors is present in the job. Factor Comparison Method. Job Factor Job A Correct rate Job B Correct rate Job C Correct rate Job D correct rate Job E correct rate 1.Skill 10 8 7.50 5 11 2. Effort 5 3 4 4 6 3. Responsibility 3 1 1 1 4 4. Working Conditions. Decision Band Method.
  6. 6.  CONCEPT OF WAGE AND SALARY ADMINISTRATION. The Wage and Salary Administration maintains equity and competitiveness in the wage market, reinforcing positive employee behavior, eliminating wage discrepancies, maintaining good relations . PURPOSE:  Attracting talented resources. Retaining and motivating employees. Financial Management Legal requirements. Concepts of different wages. • Minimum wage •Fair wage •Living wage.
  7. 7. Basic Wage Plans. • Time Wage Plan. •Piece wage plan •Skill based pay •Competency based pay. •Broad banding. Variable Compensation Program. The worker Level-----------Piece rate and time rate systems. The Managerial Level-----Monetary and non monetary rewards for achievements of results.  The Group Level-----------Incentives for group performance.
  8. 8. Executive Compensation. Steps to design an effective executive compensation plan. i. Review the existing executive compensation plan. ii. Analyze the organizational Objectives. iii. Retention Scheme. iv. Consideration on funding and other factors. v. The final plan vi. Information about the compensation plan to the stakeholders.
  9. 9. Wage Differential: …….Differences in wages paid for same or similar work because of various reasons . • Individual level. •Organizational Level. •Occupational Level. •Industry Level. •Regional Level. How Wage fixation takes place?? Who decides??  Collective Bargaining or negotiation.  Government Authorities( Pay Commission and Wage Board).
  10. 10. Concept of Reward. Extrinsic Reward Intrinsic Reward. Financial Rewards. Nonfinancial Rewards. Performance based rewards Membership based rewards.
  11. 11. Non Monetary Incentives  Recognition.  A challenging assignment.  Additional responsibility.  Free gifts and free vacations.  Awards.
  12. 12. Long Term Plans. : a. Annual Bonus. b. Profit Sharing: Distribution plan, Deferred plan, Combination plan. c. Gain Sharing: d. Employee Stock Option plans: ESPP, Restricted Stock Plan, ESOS, Stock appreciation Right, /Phantom Shares, Phantom Stock, Premium priced options.
  13. 13. Employee Benefits • Free or subsidized lunches. •Study Leave. •Medical facilities to the employee and his family. •Company Sponsored Study. •Paid holiday. •Provident Fund and gratuity. •Club Membership. •Employee Insurance. •Recreational Facilities. •Maternity Leave. •Credit Cards and tax assistance. •Child care centres. •Educational allowances for children. •Merit scholarship for employees children. •Company accommodation and conveyance. •Cafeteria and rest rooms. •Interest free loans.
  14. 14. Modern Concepts in Employee Benefit Schemes.  Golden Parachute: Continuation of the salary, Bonus and perquisites, Retirement benefits, Vesting of stock incentives.  Cafeteria Benefit Plan.
  15. 15. THANK YOU
  16. 16. DEFINITION OF FACTORS USED IN RATING JOBS.  Education Training Experience Mental Efforts. Physical efforts Visual Attention. Initiative. Responsibility. Working conditions. Physical Hazards.

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