WAGE POLICY

RAJSEKHAR MANDAL-077 ABHISHEK PANDEY-004 KUHUKEKA GHOSH-039 AKANKSHA SHARMAKASTURI DE-

THE CASE
A financial institution has began to open a branch at Bhimunipatnam, an exclusive resort located about 20 miles from waltair, a large city. There is no bank at present at Bhimunipatnam. Clerks in the city office of waltair receive a starting wage of Rs 5,500 per month As a matter of company policy, these wage rate have been set at mid point of the range for financial institution in Waltair.

 Banks in Waltair have traditionally paid lower wages than other business, on the ground that banks offer better working conditions and higher prestige. The Prevalent wage rate at Bhimunipatnam for qualified clerical personnel varies between Rs. 6000-Rs,6,500 per month. This higher rate in Bhimunipatnam may be attributed , in part , to the substantially higher cost of living in this resort town, the limited number of young people seeking employment and the fact that there are no other financial institutions in Bhimunipatnam.

QUESTION . What amount the financial institution should fix as its hiring rate for clerical personnel? What factors should be considered in making the decision ?

HIRING RATE
In this financial institution ,as a matter of company policy, the wage rate have been set at mid point of the range for financial institution in Waltair. Since the Prevalent wage rate at Bhimunipatnam for qualified clerical personnel varies between Rs. 6000-Rs,6,500 per month , abiding by the company policy, the hiring rate would be
6000+6500 2

= 6250 .

FACTORS TO BE CONSIDERED IN MAKING THE HIRING RATE DECISION.

I.INTERNAL : 1.PERFORMANCE. 2.EXPERIENCE. 3.POTENTIAL. 4.COMPANY PROFILE.

EXTERNAL :
1.DEMAND FOR LABOUR 2.TRADE UNION . 3.COST OF LIVING 4.LABOUR LAWS.