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The remuneration packets of an employee includes wages/salary ,incentives, fringe benefits , perquisites and finally non-monetary benefts. Details of Components of Employee Remuneration/compensation package: 1.wage/salary: Wage is the payment given to employee by the employer. The wage rate is decided by the employer .Wage is the hourly-rate of pay while salary refers to monthly rate of pay. Salary includes allowances and also annual increment. Salary payment is not uniform to all employees it depends upon nature of job, responsibilities, merits available, status , seniority of the employee. Wages are linked with the cost of living of the employee in which income tax and p.f are deducted. 2.incentives:Incentives are addition to regular wage payment.incentives depend on productivity,sales,profit,cost reduction efforts etc. The purpose behind incentives is to encourage/motivate employees to take more interest in the work and according to the results get the incentives. As incentives are payments by results. 3.fringe benefits: These are monetary benefits provided to employees. These includes:(a)provident fund,(b)gratuity,(c)medical care,(d)hospitalization payment,(e)accident relief,(f)healthand group insuarance,(g)subsidized canteen facility,(h)Recreation facility and(i)provision of uniforms to employees.
4.Perquites:there are special benefits offered to managers/executives. The purpose is to retain competent executives by offering them special benefits. It includes(a)company car for travelling (b)club membership (c)paid holidays (d)furnished house/accommodation (e)stock option schemes, etc 5.Non-monetry benefits: They include comfortable working conditions, impartial promotions, support to workers facing special problems, provision of welfare facilities to employees.
System of Wage payment:
There are two basic system of wage payment. These are Time Rate system and (b) Piece Rate system (A)Time Rate System Meaning of time rate system/Time Wage System: Time rate system or time wage payment (a)