Compensation, Employee Payroll & Incentive Management

Softsmith Infotech

Compensation & Employee Payroll
What is Compensation & Employee Payroll? ‡ Compensation is an integral part of human resource management which helps in motivating the employees and improving organizational effectiveness.

Softsmith Infotech

Compensation Management
‡ Compensation systems are designed keeping in minds the strategic goals and business objectives. ‡ Compensation system is designed on the basis of certain factors after analyzing the job work and responsibilities
Softsmith Infotech

etc.Compensation Management ‡ Compensation provided to employees can direct in the form of monetary benefits and/or indirect in the form of non-monetary benefits known as perks. time off. Softsmith Infotech . ‡ Compensation does not include only salary but it is the sum total of all rewards and allowances provided to the employees in return for their services.

Types of Compensation Management ‡ Direct Compensation ‡ Indirect Compensation Softsmith Infotech .

Direct Compensation Softsmith Infotech .

leave travel allowance. Pf/Gratuity. special allowances. Softsmith Infotech . conveyance.Direct Compensation ‡ Direct compensation refers to monetary benefits offered and provided to employees in return of the services they provide to the organization. medical reimbursements. bonus. house rent allowance. ‡ The monetary benefits include basic salary. etc.

Components in Direct Compensation ‡ ‡ ‡ ‡ ‡ ‡ ‡ Basic Salary HRA (House Rent Allowance) CA (Conveyance Allowance) LTA (Leave Travel Allowance) Medical Reimbursement Bonus (Salary Bonus) SA (Special Allowance) Softsmith Infotech .

Components in Direct Compensation 1) HRA (House Rent Allowance): ‡ Organizations either provide accommodations to its employees who are from different state or country or they provide house rent allowances to its employees Softsmith Infotech .

Few organizations also provide vehicles and petrol allowances to their employees to motivate them.Components in Direct Compensation 2) Conveyance : ‡ Organizations provide for cab facilities to their employees. Softsmith Infotech .

‡ The employees are given allowances to visit any place they wish with their families.Components in Direct Compensation 3) Leave Travel Allowance: ‡ These allowances are provided to retain the best talent in the organization. Softsmith Infotech . ‡ The allowances are scaled as per the position of employee in the organization.

‡ These medi-claims include healthinsurances and treatment bills reimbursements Softsmith Infotech . ‡ The employees are provided with mediclaims for them and their family members.Components in Direct Compensation 4) Medical Reimbursement : ‡ Organizations also look after the health conditions of their employees.

‡ This is apart from the salary. ‡ The bonus amount usually amounts to one month¶s salary of the employee.Components in Direct Compensation 5) Bonus: ‡ Bonus is paid to the employees during festive seasons to motivate them and provide them the social security . Softsmith Infotech .

commissions. insurance. etc are provided to employees for motivation and company¶s Productivity. Softsmith Infotech .Components in Direct Compensation 6) Special Allowance : ‡ Special allowance such as overtime. reduced interest loans. club memberships. mobile allowances. travel expenses. meals.

Indirect Compensation Softsmith Infotech .

Overtime Policy. Insurance. Leave travel Assistance Limits. Softsmith Infotech . ‡ They include Leave Policy.Indirect Compensation ‡ Indirect compensation refers to nonmonetary benefits offered and provided to employees in lieu of the services provided by them to the organization. Holiday Homes. Hospitalization. Car policy. Retirement Benefits.

Components in Indirect Compensation ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ Leave Policy Overtime Policy Hospitalization Insurance Leave Travel Retirement Benefits Holiday Homes Flexible Timings Softsmith Infotech .

‡ The Leave Policy differs in every organization. and maternity leaves. etc. casual leaves. Softsmith Infotech . ‡ The organizations provide for paid leaves such as.Components in Indirect Compensation 1) Leave Policy: ‡ It is the right of employee to get adequate number of leave while working with the organization. medical leaves (sick leave). statutory pay.

if they happened to do so. overtime pay. Softsmith Infotech . etc. such as transport facilities.Components in Indirect Compensation 2) Overtime Policy : ‡ Employees should be provided with the adequate allowances and facilities during their overtime.

say at an interval of one year.Components in Indirect Compensation 3) Hospitalization : ‡ The employees should be provided allowances to get their regular check-ups. ‡ Even their dependents should be eligible for the medi-claims that provide them emotional and social security. Softsmith Infotech .

Components in Indirect Compensation 4) Insurance : ‡ Organizations also provide for accidental insurance and life insurance for employees. ‡ This gives them the emotional security and they feel themselves valued in the organization. Softsmith Infotech .

‡ This is usually done to make the employees stress free. Some organizations arrange for a tour for the employees of the organization.Components in Indirect Compensation 5) Leave Travel : ‡ The employees are provided with leaves and travel allowances to go for holiday with their families. Softsmith Infotech .

Components in Indirect Compensation 6) Retirement Benefits : ‡ Organizations provide for pension plans and other benefits for their employees which benefits them after they retire from the organization at the prescribed age. Softsmith Infotech .

‡ These holiday homes are usually located in hill station and other most wanted holiday spots.Components in Indirect Compensation 7) Holiday Homes : ‡ Organizations provide for holiday homes and guest house for their employees at different locations. Softsmith Infotech . ‡ The organizations make sure that the employees do not face any kind of difficulties during their stay in the guest house.

Softsmith Infotech .Components in Indirect Compensation 8) Flexible Timings : ‡ Organizations provide for flexible timings to the employees who cannot come to work during normal shifts due to their personal problems and valid reasons.

Payroll Management Softsmith Infotech .

daily attendance record. value of meals and lodging etc. basic salary. bonuses. and deductions. Softsmith Infotech . ‡ It consist of the employee ID. pay for holidays. net pay. ‡ There are some deductions such as PF. vacations and sickness. bonus. overtime pay. loan installments or advances taken by employee. taxes. employee name. wages. date of joining. allowances. commissions.Payroll Management ‡ Payroll refers to the administration of employees' salaries. incentives.

Components of Monthly Payroll of an Employee Softsmith Infotech .

‡ Provident fund is deducted from the gross salary of employee on the monthly basis as per the employment law. Softsmith Infotech .Payroll Management ‡ Deductions such as tax and loan/advances taken by the employee from organizations are deducted only where applicable. ‡ Organizations also contribute the same amount to the provident fund of the employee. ‡ Dearness Allowance and House rent allowance is provided at a fixed rate stated by the employment law. which is provided later to the employee.

annual bonuses. and medical reimbursements.Annual Payroll Management What is Annual Payroll? ‡ Annual payroll consists of leave travel allowances. meal vouchers/reimbursements. incentives. Softsmith Infotech .

Components of Annual Payroll Softsmith Infotech .

Incentive Management Softsmith Infotech .

Incentive Management ‡ In today¶s strategic compensation systems. incentives forms an integral part of the performance based compensation packages. ‡ It is a challenge for organizations to formulate strategies to maintain the internal equity and external equity and provide the most competitive compensation packages to attract and retain the talented workforce Softsmith Infotech .

Softsmith Infotech . ‡ All the employees should be aware of the organizational goals and objectives. ‡ The compensation strategies should be effective. Employees are involved in the process so as to deliver unbiased packages to all the employees.Incentive Management ‡ For the purpose effective incentives programs are undertaken.

Benefits of Incentives Softsmith Infotech .

Benefits of Incentives ‡ Deserving employees should receive significant rewards . thus incentives will help to motivate them to produce more. Softsmith Infotech . ‡ Incentives accounts for employees¶ high productivity. ‡ In the hospitality and retail industry it is the incentive that accounts for the overall package of the employee. ‡ Today youngsters believe in performance based pay.

Thanking You Softsmith Infotech .

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