Compensation management

SAURABH JAIN

COMPENSATION MANAGEMENT
• Objective . • Definition. • An Integral Part of Human Resource Management.

TYPES OF COMPENSATION
• • • • Direct Indirect Variable Executive.

TRENDS IN INDIA
• Compensation trends in India changed with liberalization in 1991. • Government was the biggest job creator • Guaranteed pay determined by agreement between employee unions and Government • Private sectors made government pay scales as

CURRENT TRENDS
Factors that influenced compensation post liberalization
§ § § § § Increase in productivity gains Fast growth in real wages Faster GDP growth IT and Outsourcing services Average salary increases over 2005-06 ranged from 10% to 40%

FACTORS DEVISING PAY STRUCTURE
• Job evaluation. • What must be paid to attract right people • Affordability of the organization • Requirements to meet organizational goals • It must have 2 componentsbase rate and scope for

THE CONCEPT OF WAGE AND SALARY
Compensation administration. The principles governing compensation administration.
• • • • a)Maintaining equity. b)Maintaining competitiveness. c)Matching employee expectations. e)Devising a most efficient

THE PURPOSE OF WAGE AND SALARY
ØAttracting a talented resources. ØRetaining and motivating employees. ØFinancial management. ØLegal requirements.

CONCEPTS OF DIFFERENT WAGES.
üMinimum wage (The six norms). üFair wage . üLiving wage.

BASIC WAGE PLANS
ØTime wage plan. ØPiece wage plan. ØSkill-based wage plan. ØCompetency based pay. ØBroad banding.

Types Of Incentive Plans
Halsey Plan

Rowan Plan Barth System

Long term Plans
Gain Sharing

Annual Bonus

Profit Sharing

Short Term Point Rating system Plans
Progressiv e Bonus

Employee Stock Option

NON MONETARY INCENTIVE
• Recognisation • Assigning challenging assignment. • Giving additional responsibility. • Giving non cash rewards. • Awards for exceptional performance and valuable

GUIDELINES
• Linked to employee’s performance • Communicated • Suggestions should be valued • Not affected by external factors • Should not add negative

WAGES POLICY IN INDIA
• Minimum Wages Act, 1948.. • Payment of Wages Act, 1936.. • Payment of gratuity 1972 • Industrial Dispute Act, 1947. • Payment of Bonus Act, 1965..

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