Sasm by Rupok

INTERNSHIP REPORT
ON
Compensation and Benefit System

(A case study on Shitalpur Auto Steel Mills Limited)
SUPERVISED BY
Reheana Akhter
Lecturer
Faculty of Business Administration
BGC TRUST UNIVERSITY BANGLADESH
PREPARED BY
Abu Hena
ID = 1203327
Reg = 120103327
Batch = 4th
BGC TRUST UNIVERSITY BANGLADESH
Date of Submission =
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LETTER OF SUBMISSION
30th June, 2016
Rehana Akhter
Lecturer
BGC Trust University Bangladesh
Sub: Submission of Internship Report
Dear Madam,
It’s a matter of great joy that finally I’m submitting the Report entitled “Compensation and
Benefits system of Shitalpur Auto Steel Mills Limited” which is considered to be a partial
fulfillment of course requirement of B.B.A program under BGC Trust University
Bangladesh. My entire belief is that the acquired knowledge gathers experiences,
competencies, skills & other achievements will help out in near future. Actually there were
various limitations; I faced during the preparation of this report, but I’ve turned into the
success.
So now, my whole prayer and wish will be that please be gracious enough and receive the
paper that’s why I’ll able to footstep out to the next road of my career.
Sincerely yours
Abu Hena
Id No: 1203327
Reg: 120103327
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ACKNOWLEDGEMENT
Firstly, I would like to thank my academic supervisor Rehana Akhter, Lecturer of Faculty of
Business Administration, BGC Trust University Bangladesh for providing me all the
necessary helps for the completion of this report. Thank you very much Madam for guiding
me to start and complete this report successfully. I am also thankful for your patience that
you have shown during the project.
Secondly, I would like to thank, Mr. Nazim Uddin, Managing Director at Shitalpur Auto
Steel Mills Limited, and my Official Supervisor and Senior Manager, Mr. Fazlul Karim for
entrusting me with such an important project and allowing me scope to work independently,
providing all required support.
I also apologize heartily for any omitted name whose contribution was also complementary
for any possible aspect. Lastly, I solemnly thank the ALMIGHTY ALLAH.
Abu Hena
Id No: 1203327
Reg: 120103327
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EXECUTIVE SUMMARY
Human resource is most powerful propeller of a country’s economic growth and

development. Human resource denotes the management as well as the working force i.e.
workers, staffs and employee of a business organization. Compensation and benefits system
is a part of human resource management. This term ensures the interests of employees to the
job. To retain the expert and effective employees, every organization design compensation
and benefits structure very carefully.
SASM is established in the year 1958. It is situated at Sitakunda, Chittagong. Its head office
is situated at A/19, Road no: 3, CDA Colonel Hat, Pahartoli, Chittagong. Its initial capital
was 400 cores, but its present capital is more than 900 cores. It absorbs 1000 manpower
approximately in its operation. The mission of SASM Ltd is to achieve and maintain the
position of the world class and best quality MS Rod Manufacture and Exporter.
As per my observation, SASM Ltd emphasizes in maintaining a good industrial relations.

Employees are satisfied with the performances of Human Resource Department. The
compensation and benefits administration is quite good. They give compensation and benefits
based on performance. Various items are include in the compensation and benefits packages
i.e. medical facilities, pension system, provident fund, house allowances etc. Their salary and
wages structure is good enough. But in my case study, I have found that in some point,
employees are dissatisfied with the company’s compensation and benefits system. Employees
are stated that there is no doubt that the company is providing enough in compensation and
benefits package but the rater not enough. In my observation, I haven’t found any labor
exploitation. The working environment is good enough.
During the internship period, I have collected primary and secondary data, analysis, findings.
I have designed them and prepared a report with possible recommendations based on my
level of knowledge and skill what I achieved about the organization. I tried my level best and
concentrated enough to make this report informative. If this report helps any individual or
organization at any aspect, all my labor, attempts will come in the light of success.
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TABLE of CONTENTS
Chapter Content Page
01 Introduction 06
1.1 Origin of the study 09
1.2 Rational of the study 09
1.3 Objectives of the study 10
1.4 Methodology of the study 11
1.5 Scope of the study 13
1.6 Limitations of the study 13
02 Overview of SASM Ltd 14
2.1 SASM at a glance 15
2.2 Mission, Vision, Organizational Objectives 15
2.3 Major Business & Product Divisions 16
2.4 Board of Directors 17
2.5 Organization Chart 18
03 Literature Review 19
04 Findings 48
05 Recommendations 50
References 53
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Chapter = 01
INTRODUCTION
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01. INTRODUCTION
The steel industry plays a fundamental role in not only driving economic growth, but also
other complementary industries such as transportation, energy, heavy engineering and
construction. Despite dynamic shifts in the global scenario, the steel industry continues to be
a source of employment for over 50 million people. The global steel industry is currently
undergoing a transition. The majority of both global production and consumption of steel was
driven by China’s meteoric the growth throughout the 2000s.
With an estimated market size of 300 Billion BDT, the steel industry in Bangladesh is
currently experiencing an upsurge in demand. This growth is driven mostly by government
spending on infrastructure projects, which accounts for 40% of steel consumption in
Bangladesh. As with the global market, there is also a supply surplus in the local steel
industry: the current demand is around 4 million tons, while the total capacity is around 8
million tons. The steel industry in Bangladesh produces mainly two classes of products:
Flat steel (mainly CI sheet and CR coil) and
Long steel (MS rod/TMT bar).
Although there are currently over 400 active firms in the industry, the top 20 companies
service more than half of the demand. BSRM, the market leader, currently produces around
0.6 million tons of steel per year, with plans to scale up production capacity by 0.3-0.4
million tons a year. As BSRM and other top firms such as AKS, GPH and Bashundhara Steel
expand their capacity and improve their technological capabilities, the industry is becoming
increasingly more monopolistic. Of the over 400 steel re-rolling mills operating in
Bangladesh, around 350 mills primarily source their raw materials from ship-breaking.
However, recent regulatory crackdown by the EU has put the ship-breaking industry in dire
straits. New EU rules require that EU-registered ships to be recycled only at sustainable
facilities approved by the EU. It is unlikely that ship-breaking facilities in South Asia
(including those in Bangladesh), which often experience worker-related accidents, will
receive this approval. Furthermore, sourcing from ship-breaking makes the production more
expensive compared to the cheap Chinese steel currently flooding the global market. Thus
there is a supply-driven pressure on the local steel industry to shift away from ship-breaking
as a raw material source in order to streamline its production. Consequently, top players such
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as BSRM, GPH, RSRM, Rahim Steel and Bashundhara Steel are already producing the main
raw material, billets. Although the country currently imports 1.2 million tons of billets each
year, the annual demand for billets stands at 4 million tons. With the right strategies, local
players can fill this large demand gap. The Case for Growth According to the Steel Mint
group, production capacity of the Bangladesh steel industry has more than tripled during
FY14-15. Actual production is expected to double by 2022.
The steel industry in Bangladesh is still largely dependent on domestic growth drivers such as
government infrastructure projects and the real estate industry. At the moment, per capita
steel rebar consumption in Bangladesh is only 25 kg, compared to 57 kg in India and the
world average of 217 kg in 2012. This is expected to grow to 50 kg by 2022. Although there
is a lot of room for growth in the domestic market, focusing on steel exports is key to future
development of the industry. Already the production surplus is more than 50% of the total
domestic demand. Currently, Bangladesh exports 57.9 Million USD worth of iron and steel
products and raw materials. Although big markets such as India currently feature among
Bangladesh’s top export destinations for steel products, focusing more on other growing
Asian markets as well may be key to future exports growth. As the global steel industry
continues to transition to a new phase, the local sector has the prime opportunity to not only
grow to satisfy the domestic demand but also secure position in the emerging export markets
of tomorrow.
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1.1ORIGIN OF THE STUDY
Knowledge and learning become perfect when it is associated with theory and practice.
Theoretical knowledge gets perfection with practical implication. As the concerning parties;
educational institution and the organization substantially benefit from such a program namely
“Internship”, the sole purpose of internship is to train the students and prepare themselves for
the real life in job markets. I have developed this internship report as a partial requirement to
acquire the BBA degree. I have tried my level best to make this report informative and
enriched so that the real things can easily be displayed.
My supervisor Rehana Akhter assigned me the topic “Compensation and Benefits System of
Shitalpur Auto Steel Mills Limited (SASM)”. I have tried my level best to make it as an
excellent one. I used all the latest data and information. I have been serving this company as
an intern under Human Resource Department of SASM. This is an internship project study on
So, I am getting the opportunity to be very close to activities of SASM Ltd. My official
supervisor Mr. Fazlul Karim guides me time to time to make this report fruitful.
1.2RATIONAL OF THE STUDY
In order to fulfill the requirement of the Internship program it has chosen Shitalpur Auto
Steel Mills Ltd, Human Resource Division (HRD) of SASM Ltd placed me to their head
office at Pahartoli. The overall topic of the report has been selected by discussion between me
and supervisor .The topic of my report is “Compensation and Benefits System of Shitalpur
Auto Steel Mills Ltd”.
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1.3OBJECTIVES OF THE STUDY
1.3.1. Broad objectives:

To know about the employee compensation and benefits package of SASM Limited.
The primary objective of this report is too familiar with the working environment of
present institutions and also fulfills the requirement of BBA theoretical knowledge
gained from the coursework of the BBA program in a specific field.
1.3.2. Specific objectives:

To know about the employee benefits plan of SASM Limited.
To illustrate various types of allowances and other compensation related facilities

provided by SASM Limited.
To identify the problems of employee compensation & benefits package of SASM
Limited.
To suggest some possible recommendations to overcome the problems.
To Understand and analyze the overall activities of SASM Limited.
To evaluate the existing activities and techniques of SASM Limited
To study the operational efficiency of SASM Limited
To suggest the ways and means for improvement in policy and techniques
To relate the theoretical learning with the real life situation
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1.4METHODOLOGY OF THE STUDY
1.4.1. Type of Research:

This report is a descriptive type of research in nature and it administered by collecting both
primary and secondary data. It has tried to use both the primary and secondary sources of
collecting information and some are to make the report presentable with as less abstraction as
possible.
1.4.2. Types of data collection:

In order to attain the objective of the report, all-necessary information’s are prepared by
collecting both primary & secondary sources of data. These are:
1.4.2.1. Primary data:

Primary data collected directly to provide the SASM Limited companies employees
compensation & benefits package through face-to-face interaction. It is the systematic
collection of information directly from respondents using survey. Several sources of data
collection are used to make this report. The source of data are-
 Questionnaire survey.
 Face to face communication.
 Telephone interview.
1.4.2.2. Secondary data:

Some secondary data collected to make the report more concrete. These data has been
collected from:
 SASM Limited annual report 2013, 2014, 2015.
 SASM Limited statistical report 2015.
 Web site: www.sasmbd.com.
1.4.3. Methods of Primary data collection:

Primary data:
Fill up the questionnaire by questioning. In depth interview with employees of SASM

Limited.
Questionnaire Design:
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This questionnaire was developed with the combination of close-ended procedure. By using
close-ended questionnaire the researcher can identify any opinion, complain and feelings of
the respondents. The length of the questionnaire is 2 (two) pages (A4 size paper). The
questionnaire has 2(two) sections. In section 1 - the personal information, in section 2-
Subject related questions.
1.4.4. Sample plan:

Population:
The population of my survey is all of the SASM Limited employees. The first step of the
sampling design is to define the report population. I mainly focused on the Head office
employees.
Sample Size:
The total sample size for the study is 20.
Designation No. of employees

Junior Manager 14
Senior Manager 06
Total 20
Table: 01. Sample size
Sample unit:
The total sample unit is 20.
1.4.5. Data Analysis and reporting:

Statistical tools and computer software like Ms Word, Ms excel, Ms Power point have been
used for analysis and reporting.
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1.5 SCOPE OF THE STUDY
The report covers the Employee compensation & benefits systems of ACI Limited. The
report presents employee compensation, allowance, incentives, Provident fund, gratuity,
insurance, employee leave & medical facilities of SASM Limited.
1.6 LIMITATIONS OF THE STUDY
The report is not free from some practical limitations. Following limitations have faced
during the report and the time of working & data collection:
In many cases the relevant authorities are not helpful to provide information.
Up to date information were not available.
Lack of instrumental facilities to get proper information.
Lack of Records, Sufficient books, unavailable information in website. These

constraints narrowed the scope of accurate analysis.
The employees of the company were so much busy with their jobs, which lead a little
time to consult with me.
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Chapter = 02
OVERVIEW OF SHITALPUR
AUTO STEEL MILLS LIMITED
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2.1 SHITALPUR AUTO STEEL MILLS Ltd AT A GLANCE
SHITALPUR AUTO STEEL MILLS LIMITED is established at 1985 by well known

industrialist Mr. Md. Jashim Uddin. It is based on Chittagong. The factory of the company is
located in Sitakunda area and head office in Pahartali area. SASM has involved with the steel
industries of Bangladesh for the last 30 years with the sole aim of serving the nation with
quality steel products mainly ms Rod at reasonable and most competitive price. They have no
compromise in maintaining the international standard of quality control. Meantime, they are
glad to have achieved a fair degree of success with numerous satisfied customers throughout
the country within a short space of time. They are happy to state that they have been able to
retain most of their customers with their utmost satisfaction and the list of prospective
customers is expanding most rapidly. The company employs 1000 workers.
At the time of establishment, SASM has only one unit of rolling machine. Because of
increasing demand, SASM developed it into three units. The company has buys a ship as they
has to brought raw materials from outside. The starting capital of the company is 400 corers
and now the capital is more than 900 corers. SASM distributes its product to the all over the
country. Their ultimate vision is to export the product to the outside of the national borders.
SASM takes part in various social activities to help the government in the development of the
society.
Company policy
SASM Ltd is built on long traditional values with ceaseless pursuit of customer
satisfaction by giving them high quality steels at reasonable prices. Our commitment to
quality is uncompromising
2.2 MISSION, VISION & ORGANIZATIONAL

OBJECTIVES
2.2.1. Vision:
To stand out as a pioneer steel industry in Bangladesh and contribute significantly to

the national economy
To export the products outside of the country.
2.2.2. Mission:
High quality services with the help of the latest technology
Fast and accurate customer service.
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Balanced growth strategy.
High standard business ethics.
Steady return on shareholders' equity.
Innovative service at a competitive price.
Attract and retain quality human resource.
Firm commitment to the society and the growth of national economy.
2.2.3. Organizational Objectives:
Make sound investments.
Meet capital adequacy requirement at all the time.
Ensure a satisfied work force.
Ensure 100% recovery of all advances.
Adopt an appropriate management technology
2.3 MAJOR BUSINESS & PRODUCT DIVISIONS
2.3.1. Major Business:

Major business of SASM is producing MS Rod and sells them by the distributors.
2.3.2. Product Divisions:

SASM produces various sizes of MS Rods. The are-
Product Name Product Size
TMT Ultra Strong 500W 25mm
TMT Ultra Strong 500W 10 – 22mm
TMT Ultra Strong 500W 8 mm
Table: 02. Product Divisions
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2.4 BOARD OF DIRECTORS
NAME Designation
Md. Jashim Uddin Chairman
Md. Nazim Uddin Managing Director
Md. Jane Alam Director
Md. Mahbubul Alam Director
Mohammed Hossen Director
Table: 03. Board of Directors
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2.5 ORGANIZATIONAL CHART
MANAGING DIRECTOR
CORPORATE
MRKETING SUPPLY FINANCE CORPORATE
TECHNICAL QUALITY
AND SALSE CHAIN CONTROL HR
MANAGER ASSURANCE
MANAGER MANAGER MANAGER MANAGER
MANAGER
FINANCE
QUALITY
CONTROLLER HR
ASSURANCE
MANAGER
MANAGER
PLANT CORPORATE
MANAGER MANAGER
DEMAND AND
DISTRIBUTION DISTRIBUTION
SUPPLY
OPERATIONS SERVICES
PLANNING
Figure: 01. Organizational Chart
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Chapter = 03
LITERATURE REVIEW
Part = 01 Theoretical Aspects Page = 20

Part = 02 Compensation & Benefits Page = 25
System of SASM
Part = 03 Data Analysis Page = 36
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PART = 01
THEORETICAL ASPECTS
3.1. Compensation:
The word compensation has been derived from the Latin word “Compensatio” which means
the reward or remuneration given in exchange for labor or service. Compensation may be
financial and non- financial.
Various scholars have defined compensation in various ways. A few are mentioned below:
According to Thomas Patten Jr. and colleagues,
“Compensation refers to all forms of pay or rewards going to employees arising from their
employments”
3.2. Compensation Management:
Compensation management provides a step-by-step approaches for designing a remuneration

system that recognize job requirements, employee related knowledge and skills, performance
related incentives that link individual, team, work unit, and organization performance.
According to Richard l. Henderson,
“Compensation management is the process by which the authority of the organization

provides some financial and non-financial benefits to the employees for their contribution”.
 3.2.2. Recognition of Employee’s contribution means:
Financial compensation:
The organization provides the financial facilities to the employees for doing their job in the
organization. Financial compensation includes the followings:
Salary.
Wages.
Incentives.
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Fringe benefits.
Dearness allowance.
Medical allowance.
House rent allowance.
Gratuity.
Retirement benefits.
Non-financial compensation:
Besides financial compensation, the organization also provides non-financial compensation to

the employees for attracting and performing their jobs in the organization. Non-financial
compensation includes the following:
Dignity.
Recognition.
Working condition.
Social status.
Achievement.
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3.3. Components of Compensation:
Compensation system
Indirect Compensation Direct Compensation
Base Pay Merit Pay
Salary Wage
Protection Programs:
Pay for Time Not Worked:
Services and perquisites: Incentive Pay: Deferred Pay:
● Medical Insurance
● Vacations ● Recreational Facilities ● Bonus ● Savings plan
● Life Insurance ● Holidays ● Car ● Commission ● Stock purchase
● Disability income
● Sick Leave ● Financial Planning ● Piece rate ● Annuity
● Pension ● Jury duty ● Low cost or free meals● Profit sharing
● Social Security ● Stock option
● Shift differential
Figure: 02. Compensation System Components
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3.4. Objectives of Compensation Management:
Objectives of compensation are very important because it helps the organization obtain,
maintain and retain a productive work force.
Without adequate compensation, current employees are likely to leave. It is the main reason
why most individuals seek employment. From the employee’s point of view, pay is necessary
of life. Pay is the means by which people provide for their own and their family needs.
The Management of compensation must meet several objectives. These objectives are listed
below:
Compensation needs to be high enough to attract qualified personnel.

Compensation level must be competitive in order to retain qualified employees
otherwise they may leave.
Workers must be paid at a rate equal to the pay that similar workers receive in
another firm.
Good performance, experience, loyalty, new responsibilities and behavior can be
rewarded through an effective compensation plan.
The compensation system must be cost effective.
The compensation system must with all sorts of legal regulations.
To manage conflict and to ensure congenial working environment.
To generate motivation among employees.
To reduce turnover.
To ensure loyalty/ commitment and participation.
To reduce absenteeism.
To enhance or improve productivity.
To ensure continuity of sound working spirit.
3.5. Factors Affecting Pay Satisfaction:
Nash and Carroll found that pay satisfaction varies with the following factors.
Higher the pay, higher the satisfaction within an occupational group.
Lower the cost of living, higher the pay satisfaction.
Lower the education level, higher the pay satisfaction.
Higher the experience, higher the pay dissatisfaction.
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The more optimistic the employee is about future job conditions, the greater the pay
satisfaction.
The more pay is perceived to be based on merit or performance, the greater the pay
satisfaction.
The more intelligent, self-assured and decisive a person is, the lower the pay
dissatisfaction.
3.6. Consequences of Ineffective Compensation:
Effects of over-compensation Effects of under-compensation

Demoralizing effects on other Loss of initiative.
employees. Lack of Motivation.
Over enthusiasm. Feeling of insecurity.
Loss of initiative. Feeling of anxiety.
Feeling guilt. Decline in the quality of work life.
Feeling of discomfort. Pay dissatisfaction.
Lower performance. High turnover.
Not cost effective. High absenteeism.
Loss of competitiveness of the firm. Low Performance.
Table: 04. Consequences of Ineffective Compensation
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PART = 02
COMPENSATION & BENEFITS SYSTEM OF SASM
3.7. Compensation & Benefits System of SASM:
Compensation is really very important matter for any business organization. For any business
organization, the employees who make up the workforce are very important. It is also very
important to make an attractive compensation package for these employees. The
compensation package must be very attractive to increase the image of the organization as
well as to retain the employees with the organization.
SASM Limited is also following a compensation package that helps them to retain the full
time employees and the casuals. Though they are on a track to compensate the employees in a
competitive manner, but they try to give a bit higher salaries and wages to the employees to
remain as a competitive organization in the market.
They judge the job positions first and then they go for the study of the same categorized job
position in the other organizations, and see the pay level of these positions. Then, SASM
Limited decides that how much will be paid to the positions that they are defining or
examining. In this case SASM Limited tries to be very fair about the pay levels. They try to
fix the pay level in such a manner that is fair and effective for them and to the employees too.
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3.7. SASM Compensation & Benefit packages are:
Allowances Incentives/ Benefits
Office Field Staff Office Management Field Staff

Management staff
staff
 House Rent  House  Quarterly/Yearly:  Quarterly/ Yearly:

allowance Rent
(60% of allowance  Yearly Leave  Yearly Leave
basic) (60% of Fare Assistance. Fare Assistance.
basic) (50% of basic) (50% of basic)
 Medical
allowance  Medical  Yearly two  Yearly two
(50% of allowance festival bonuses. festival bonuses.
basic) (50% of (50% of basic) (50% of basic)
basic)
 Transport  Yearly  Yearly workers
allowance  Transport performance participation
(50% of allowance Bonus. (50% of Fund. (50% of
basic) (50% of basic) basic)
basic)
 Lunch  Yearly workers  Quarterly sales
allowance  Utility participation incentive. (Not
(Tk.700 to allowance Fund. (40% of fixed)
Tk. 1000) (40% of basic)
 Long Term:
basic)
 Utility  Long Term:
 Provident Fund.
allowance
 Provident fund.
(50% of  Gratuity.
basic)  Gratuity.
 Group Insurance
 Group Insurance Policy.
Policy.
 Medical Benefits.
 Medical Benefits.
Table: 05. SASM Compensation & Benefit Packages
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3.8. Employee Benefits Plan of SASM:
Employee benefits plan is the most important part of an organization. It is motivated to
employee. SASM Limited continually evaluates and reviews its employee benefits plan to
ensure that benefits are competitive. Employee benefits plan are:
To establish wage & salary plan of SASM Limited employees:
Wage & salary plan comprises the following components:
 SASM has a competitive monthly total base salary.
 The company follows an annual performance based salary increment.
 Performance bonus is available in SASM.
SASM Limited also provides night shift premium, incentive, festive advance, transport
reimbursement etc.
To implement employee incentive plan of SASM Limited:
 Quality of work output. ( How many units produced)
 Quality of work output ( What was the quality of the product or service being
produced or served)
 Monthly sales. ( How much sales was generated)
 Work safety record. ( How many hazard or errors are being reduced)
 Work attendance ( If the absent is reduced or attendance is good)
To ensure health & medical allowance plan of SASM Limited employees:
All employees of ACI will receive a monthly medical allowance as per respective grade of
the employee. The allowance will be paid together with the employee’s monthly salary and
for this no receipt needs to be submitted.
To make sure effective Provident fund plan of SASM Limited employees:

Permanent employees of SASM Limited are eligible to become members of the provident
fund. Employees contribute 10% of their basic to the provident fund and the company makes
equal contribution to the fund.
To make situation demanding profit sharing plan of SASM Limited employees:
There are some employees who prefer to feel a sense of ownership; this also gives them
direct reason to want to see the company succeed because they are financially invested. As a
means to invigorate many companies offer profit sharing as a reward for strong motivation in
a job well done.
To provide flexible-time benefits plan for employees in order to ensure their
right:
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Many employee want Alternative work schedules. Sometimes employees flourish on
different kinds of work schedules as opposed to the traditional (and often monotonous) 9 to 5
schedules.
To set up leave for marriage, maternity leave, sickness leave and vacation leave
plan of SASM Limited employees:
SASM also has paid leave for marriage, maternity, sickness and vacation plan.
To make sure short term & long term benefit plan of SASM Limited employees:
 Short term benefits plan:
 Yearly Leave Fare Assistance.
 Yearly two festival bonuses.
 Yearly workers participation Fund.
 Quarterly sales incentive.
 Long Term benefits plan:
 Provident Fund.
 Gratuity.
 Group Insurance Policy.
 Medical Benefits.
To establish gratuity plan of SASM Limited employees:
SASM has gratuity plan. Gratuity is considered as long-term financial benefit for employees.
Payable at the time of leaving the company upon completion of at least 8 years of continuous
service. The employee will receive an allowance equal to his/her last drawn basic for each
completed year of service.
To cover all employees under the group life insurance plan:
SASM Limited provides insurance coverage for partial or permanent disability and death
under group life insurance.
To concentrate on the Leave benefits plan of SASM Limited employees:
SASM limited all management staff will have the following leave entitlement in a calendar
year.
Privilege leave: 24 days
Sick leave: 14 days.
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3.9. Various Allowances of SASM:
Different types of allowances given on the basis of salary in SASM Limited:
Employee Designation
Office Management staff Field Staff

Salary & Benefits
Basic Salary 5500-57000 3000-8500
House Rent allowance 60% of basic 60% of basic
Medical allowances 50% of basic 50% of basic
Transport allowances 50% of basic 50% of basic
Lunch allowance Tk.700 to Tk.1000 -------
Utility allowance 50% of basic 40% of basic
Table: 06. Various Allowances of SASM Limited
3.10. Compensation Related Benefits of SASM:

Employee salary:
SASM Limited is committed about maintaining salaries and benefits that are fair to all
employees and competitive in the local market place. The management monitors changes in
the economy and salary market to ensure that ht overall compensation package is sufficient to
attract, recruit and retain high quality staff within the financial capabilities of SASM Limited.
At all times the management considers long term financial implications of changes in
employee compensation as well as fairness to employees currently serving the company.
Principles of salary:
The compensation structure is framed with the objective to attract and retain high quality
people. The guiding principles of the compensation policies are:
1. Individual’s background and Experience.
2. External pay market levels and trends ( determined through compensation survey)
3. Particular skills requirements of the company.
4. Company’s affordability.
5. Company’s statutory obligations.
Payment of salary:
a. Mode of payment:
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Payment shall only be made in Bangladeshi take. Every employee should have a salary
account in company nominated commercial bank. The salary will be transferred to the
respective salary accounts from the confidential department within the last day of each
month.
b. Pro rate payment:
If any employee is hired in the middle of a month the salary will be paid on pro rate basis
and the salary can be paid in cash if the salary account is yet to be opened.
c. Advance salary payment:
No advance salary or advance from already earned salary can be disbursed to any
employee without written approval of the managing director.
Loan against salary:
Generally such loan is discouraged. Only in extreme cases, depending on the merit, loan may
be considered and approval for loan will require managing director’s approval.
Incentives:
Compensation fluctuates according to:
o A pre-established formula.
o Individual or group goals because group goals are different from individual goals.
o Company earnings
An incentive adds to base pay:

o It controls costs because the employee is being paid for his/ her extra effort and for
the benefits brought to the organization.
o Motivates employees.
Incentive pay categories:

 Individual.
 Group.
 Company-Wide.
Individual incentive:
 Quality of work output. ( How many units produced)
 Quality of work output ( What was the quality of the product or service being
produced or served)
 Monthly sales. ( How much sales was generated)
 Work safety record. ( How many hazard or errors are being reduced)
Page 30 of 54
 Work attendance ( If the absent is reduced or attendance is good)
Group Incentives:
 Customer satisfaction.
 Labor cost savings.
 Materials cost savings.
 Reduction in accidents.
 Services cost savings.
Company- Wide:
 Company profits.
 Market share.
 Sales revenue.
Sales Incentive:
 Instead of performance bonus, field sales staff will the rewarded with quarterly sales
incentive for their contribution to the company.
 Incentive schemes for each business will be proposed by respective business head during
budget preparation for the coming year. This scheme will require approval from the
managing director and should be communicated to field force before beginning of the
year.
 Based on requirement of the business, head of business may propose and implement any
change of the scheme subject to the approval of the managing director.
Provident fund:
The company has instituted provident fund for management staff.
 All Management employees will join the provident fund scheme after confirmation.
 Along with the confirmation latter Human Resource Department will send a provident
fund joining and nomination form to the employee.
 The provident fund will run on contributory basis, i.e. 10% of basic salary from the
employee and equal amount from the company.
 If any employee leaves the company, he/she will be entitled to the company’s
contribution only after 5 years from the date of confirmation, else, the employee will
only be entitled to his/her own contribution.
 Company has formed a trusty committee to maintain the provident fund.
 Conditions with regard to provident fund shall be regulated as per the rules of the fund.
Gratuity:
Page 31 of 54
An employee shall be eligible for gratuity on leaving the company after continuous and
confirmed service of at least 8 years to the following terms and conditions:
I. Separation on account of superannuation, ill-health, physical or mental
incapacity, redundancy or termination:
Year Amount
On completion of 8 years of service & Half month’s basic salary for each
having not completed 12 years service completed year of service
On completion of 12 years of service 1 month’s basic salary for each
completed year of service
Table: 07. Gratuities
II. Voluntary Resignation:
Year Amount
Before completion of 8 years of service No gratuity is payable
On completion of 8 years of service & Half month’s basic salary for each
having not completed 12 years service completed year of service
Table: 08. Gratuities
III. In the event of death or total disablement; gratuity will be paid at the rate of two
month’s basic salary for each completed year of service. In case of death, the
gratuity shall be paid to the legal heir/ heirs.
IV. The term basis salary, as used, means basic salary last drawn by the employee at
the time of separation from the company’s employment.
Insurance:
The company has instituted a fund for management staff which provides payment of death
during service by any cause, except in the first twelve months of insurance.
I. Group life insurance is payable under any kind of death during service except in case
of suicide.
II. Staff should advise HR Department the particulars of their nominees including name
and relationship.
III. If the nominee is a minor, the name of the minor’s guardian should also be advised.
IV. Respective business/ department will pay equivalent to the payable insurance amount
to the nominee/ guardian (in case of nominee is a minor).
Medical benefits:
Page 32 of 54
All employees of SASM will receive a monthly medical allowance as per respective grade of
the employee. The allowance will be paid together with the employee’s monthly salary and
for this no receipt needs to be submitted. For special case of treatment, following are the
additional support extended to the employee’s.
Level of employees Types of medical Amount

benefits
Hospitalization 50%
Office
Management staff
Surgery 50%
Hospitalization 50%
Field staff
Surgery 50%
Table: 09. Medical benefits

i. In case of hospitalization of the staff, spouse or two dependent children, in any
recognized hospital or clinic, the company will reimburse 40% of the hospitalization
charges, which will include bed/cabin rent, doctor’s fees and laboratory tests &
medicine required during the period of hospitalization. All other charges will be borne
by the staff.
ii. In case of surgery, the company will reimburse 40% of the total operation charges
comprising of surgeons fee, anesthetist’s fee & O.T. charges and cost of medicine
related to the surgery.
iii. Prior approval from the head of business is necessary before hospitalization or
surgery. The name of the patient and the name of the hospital/ clinic need to be stated
while taking the approval.
iv. Department heads will approve advance against surgery for staff on a case- to-case
basis.
v. Expenses for delivery under caesarean section will be reimbursed as per clauses 2.
Reimbursement of more than two children will not be allowed.
vi. These rules will be subject to modification from time to time at the discretion of the
company.
vii. Normally, SASM does not allow treatment abroad, In case where treatment/ surgery
are not sagely/ reliably available in Bangladesh, the SASM may consider allowing the
individual to proceed abroad for such treatment/ surgery. In such cases, the company
shall be totally satisfied as to the merits of the case on the basis of the best medical
option available. All such treatment abroad should be approved by the managing
director before initiating the formalities.
viii. The SASM will not be liable to pay medical charges for any facial or skin
beautification such as Rhinoplasty, Liposuction, Otoplasty, Blepharoplasty or laser/
Lasik Surgery, Facelift, Cosmetics dentistry/ tooth restoration, etc.
Page 33 of 54
ix. In case of treatment in the hospitals/ clinics which are not enlisted; the bills will be
settled at the rate of enlisted similar hospital/ clinic.
Leave:
Entitlement:
All management staff will have the following leave entitlement in a calendar year:
Level of Employees Types of leave Days of leave

Privilege Leave 24
Office Sick Leave 14
Management staff
Privilege Leave 24
Field staff
Sick Leave 14
Table: 10. Leave
Entitlement credit:
i. Full entitlement is credited from the succeeding years on the basis of leave earned in
the previous calendar year.
ii. Privilege Leave is (PL) is credited after completion of one year service. However,
there will be proportionate entitlement from the date of joining to the end of that
calendar year.
iii. For staff leaving the company’s service, proportionate PL is credited.
iv. Sick Leave (SL) entitlement begins from the time of joining proportionate to the
remaining period of the calendar year. Full entitlement is credited from the beginning
of the following calendar years.
v. PL is not normally granted before completion of one year of service. However, in

special circumstances managers my recommend leave for his subordinate and forward
the application form to the head of the department for consideration, if approved, such
leave will be adjusted from future entitlement when due.
vi. It is not the policy of the company to grant leave without pay. Under extreme
circumstances such as study leave, staff may make representation to their department
heads. Sanction of such leave should be made in consultation of the HR Department.
vii. Leave records for all management staff will be maintained by the HR department at
the Head office. In January every year leave balance will be sent to the respective
management staff for confirmation. On receipt of confirmation the leave application
of the previous year will be destroyed.
Page 34 of 54
viii. Leave roster will be prepared by each department for every year and department
Heads should ensure that management staff under him are given leave as per roster.
ix. Absence on account of “Hartal” will be adjusted from privilege Leave.
Leave Accumulation:
i. Leave may be accumulated up to maximum of 4 years entitlement for both office

management & field staff. Unutilized leave in excess of 4 years entitlement on 1 st
January shall stand lapse.
ii. Leave lapsing on account of company’s business and therefore for no fault of the
individual may be allowed to be carried forward in addition to the maximum
entitlement. Such accumulation shall be allowed by the HR on recommendation by
the respective department Head.
PART = 03
DATA ANALYSIS
1. Does human resource department properly contribute in your job?

Particular Respondents percentage
Page 35 of 54
Agree 11 55%
Strongly agree 7 35%
Neutral 2 10%
Disagree 0 0%
Strongly disagree 0 0%
Total 20 100%
Table: 11.
Contribution of HR department
Agree Strongly agree Neutral Disagree Strongly disagree
10%
Graph: 01. Contribution of HR department
Interpretation:
From the above graph, it is seen that 55% employees35%
are agree, 35% employees are strongly55%
agree, they said that human resource department properly contributes in their job and 10%
employees are neutral.
Comment:
Most of the employees are said HR department properly contribute in their job.
2. Are you satisfied with the levels of support that you normally get from HR
department when you face problems?
Satisfied 9 45%
Strongly satisfied 5 25%
Neutral 4 20%
Page 36 of 54
Dissatisfied 2 10%
Strongly dissatisfied 0 0%
Total 20 100%
Table: 12.
Support to HR department
Satisfied Strongly satisfied Neutral

Dissatisfied strongly dissatisfied
10%
20%
45%
25%
Graph: 02. support to HR department

Interpretation:
From the above graph, it is seen that 45% employees are satisfied, 25% employees are
strongly satisfied, and 20% employees are neutral and 10% employees are dissatisfied.
Comment:
Most of the employees are satisfied with the levels of support that normally get from HR
department when they face problems.
3. Are there any short term/ long term disabilities/facilities available in your
organization?

Agree 11 55%
Neutral 0 0%
Page 37 of 54
Disagree 0 0%
Total 20 100%
Table: 13.
Short term/Long term disabilities
Agree Strongly agree Neutral

Disagree Strongly disagree
45%
55%
Graph: 03. Short term/ Long term disabilities
Interpretation:
From the above graph, it is seen that 55% employees ate agree & 45% employees are
strongly agree they said short term/ long term disabilities available in organization.
Comment:
Most of the employee said short term/ long term disabilities are available in organization.
4. How do you rate your company’s incentive systems?

Excellent 0 0%
Very good 2 10%
Good 4 20%
Page 38 of 54
Average 14 70%
Poor 0 0%
Total 20 100%
Table: 14.
Incentives system
Excellent Very good Good Average Poor
10%
20%
70%
Graph: 04. Incentives system

Interpretation:
From the above graph, it is seen that 70% employees said that organization incentive systems
are average, 20% employees said it is good, 10% employees are said it is very good.
Comment:
Most of the employees said that organization incentive systems are average.
5. Are you satisfied with the compensation benefits and plans provided to you?

Satisfied 6 30%
Page 39 of 54
Neutral 3 15%
Dissatisfied 9 45%
Total 20 100%
Table: 15.
Compensation & benefits plan

30%
45%
15% 10%
Graph: 05. Compensation & benefits plan

Interpretation:
From the above graph, it is seen that 45% employees are dissatisfied with the compensation
benefits and plans provided to their, 30% employees are satisfied, 15% employees are
neutral, 10% employees are strongly satisfied.
Comment:
Most of the employees are dissatisfied with the compensation benefits and plans provided to
themselves.
6. Are you satisfied with the insurance coverage’s offered to you?

Satisfied 5 25%
Page 40 of 54
Neutral 0 0%
Dissatisfied 13 65%
Total 20 100%
Table: 16.
Insurance coverage

25%
10%
65%
Graph: 06. Insurance coverage

Interpretation:
From the above graph, it is seen that 65% employees are dissatisfied, 25% employees are
satisfied with the insurance coverage offered to them, and 10% employees are strongly
satisfied.
Comment:
Most of the employee dissatisfied with insurance coverage offered to them.
7. Do your organizations provide the life insurance facility?

Agree 15 75%
Page 41 of 54
Neutral 0 0%
Disagree 0 0%
Total 20 100%
Table: 17.
Life insurance facility

25%
75%
Graph: 07. Life insurance facility

Interpretation:
From the above graph, it is seen that 75% employees are agree & 25% employees are
strongly agree, they are said that organization provide the life insurance facility.
Comment:
Most of the employees are agree about the organization provide the life insurance facility.
8. What types of insurance facilities offered to you by your company?

Individual insurance 2 10%
Page 42 of 54
Group insurance 18 90%
Any other 0 0%
Total 20 100%
Table: 18.
Insurance facilities
Individual insurance Group insurance Any other
10%
90%
Graph: 08. Insurance facilities

Interpretation:
From the above graph, it is seen that 90% employees said that organization provide group
insurance facilities to the employee, 10% employees said that organization also provide
individual insurance facilities offered to their employee.
Comment:
Most of the employees said that organization provide the group insurance.
9. Do your organizations provide the medical facilities?

Agree 13 65%
Page 43 of 54
Neutral 0 0%
Disagree 0 0%
Total 20 100%
Table: 19.
Medical facilities

35%
65%
Graph: 09. Medical facilities

Interpretation:
From the above graph, it is seen that 65% employees are agree, they said organization
provide the medical facilities, 35% employees are strongly agree with the scenario.
Comment:
Most of the employees said that organization provide the medical facilities.
10. How would you rate the type of pension/retirement plan provided to you?
Page 44 of 54
Excellent 0 0%
Very good 0 0%
Good 5 25%
Average 11 55%
Poor 4 20%
Total 20 100%
Table: 20.
Pension/retirement plan
Excellent Very good Good Average Poor
20% 25%
55%
Graph: 10. Pension/ retirement plan

Interpretation:
From the above graph, it is seen that 55% employees said SASM pension/ retirement plan is
average, 25% employees said that SASM pension/retirement plan is good, 20% employees
said that SASM pension/retirement plan is poor.
Comment:
Most of the employee said that SASM pension/ retirement plan is average.
11. Are you satisfied with your current salaries?
Page 45 of 54
Satisfied 2 10%
Neutral 1 5%
Dissatisfied 17 85%
Total 20 100%
Table: 21.
Current salaries

Dissatisfied strongly10%
dissatisfied
5%
85%
Graph: 11. Current salaries
Interpretation:
From the above graph, it is seen that 85% employees are dissatisfied with their current
salaries, 10% employees are satisfied with their current salaries, and 5% employee are neutral
position.
Comment:
Most of the employees said that they are dissatisfied with their current salaries.
12. Are you satisfied with your work environments?
Page 46 of 54
Satisfied 12 60%
Neutral 0 0%
Dissatisfied 5 25%
Total 20 100%
Table: 22.
Work environments
Satisfied Strongly satisfied Neutral Dissatisfied strongly dissatisfied
25%
60%
15%
Graph: 12. Work environments

Interpretation:
From the above graph, it is seen that 60 % employees are satisfied with their work
environments, 15% employees are strongly satisfied with their work environments, and 25%
employee are dissatisfied with their work environments.
Comment:
Most of the employees are satisfied with their work environments.
Page 47 of 54
Chapter = 04
FINDINGS
Page 48 of 54
FINDINGS
Most of the employees are agreed that HR Department properly contributes in their
tasks.
Employees are satisfied with the support; they get from the HR Department when the
faces problems and they are also satisfied with the training which they get from the
HR Department.
From the analysis it has seen that employees are not satisfied with the organization‘s
incentive systems.
Employees are confirmed that short term and long term disabilities are available.
Life insurance is provided by the company and the employees are satisfied with this.
SASM compensation related benefits and packages are not sufficient.
In the analysis it has seen that most of the employees are dissatisfied with the
insurance coverage offered to them.
SASM Limited only provides the group insurance facility but does not provide any
individual insurance facility.
Compensation package is determined on the basis of performance.
From the analysis I found that SASM pension/ retirement plan is average.
With the organization’s current salary structure, maximum amount of the employees
are dissatisfied.
Employees are satisfied with the current work environment.
Medical facilities is given by the SASM Limited, is satisfactory to the employees. But
they demand for the development of the rates.
Page 49 of 54
Chapter = 05
RECOMMENDATIONS &
CONCLUSION
Page 50 of 54
RECOMMENDATIONS
The organization should ensure standard incentive policy to their employees for their
high level of satisfaction.
The organization should increase its compensation related benefits which are provided
to the employees.
The organization should provide effective/acceptable insurance coverage to their

employees.
SASM Limited should also provide individual insurance benefit along with group
insurance.
The organization’s pension/ retirement plan should be modified in favor of their

employees.
The organization may increase current salary structure of their employees.
Page 51 of 54
CONCLUSION
SASM Limited is one of the promising MS Rod producers in Bangladesh, with a

multinational heritage. In Bangladesh, SASM Limited has been doing business and soundly
maintaining social responsibilities. The agenda of this company earning profit, creating job
opportunity, though trade and commerce. Achievement of SASM Limited is beyond
description. Maintaining Government rules and regulations SASM Limited always try to
contribute on national G.D.P and G.N.P. SASM follows most of the compensation practices
and policy. They always try to contribute to employee satisfaction and given to employees all
types of compensation benefits. It has always been a dream to be able to work for a highly
reputed company and my dream was fulfilled for two months as I was conducting my
internship in SASM Limited.
It has been an amazing experience for me as I completed my internship as well as my first job
from such an incredible organization. In this company, interns are not treated as guests for
three months. We are actually involved in real
time projects where our inputs and contributions
are highly appreciated and necessary. During my
internship or my first job, I was exposed to many
works which I never thought of even doing.
As I have Human Resource Management as my

major so working under the department of HRM
was really great to me. Therefore I must
acknowledge the fact that there are countless
number of things that I learnt during my internship
about how the company operates, its day to day activities, problems that occur every day and
how to resolve them effectively and efficiently. No matter where I work, I’m confident that I
will be able to apply my learning and knowledge in any organization
Page 52 of 54
REFERENCES
Briefing and Interview:

 Briefing by Senior Manager Mr. Md. Fazlul Karim and the fellow officers of the HR
Department of SASM Limited
Books:
 “Compensation management in a knowledge- Based world”, Henderson I. Richard,
10th edition, Jun24, 2005.
 “Strategic compensation- A human resource management”, Martocchio J. Joseph, 6th

edition, Jan21, 2010.
 Strategic management of human resource by Jeffrey A. Melo, 3rd edition, 2011.
Reports:
 SASM Limited annual report 2013.
 SASM Limited Statistical report 2015.
Websites:
 www.sasmbd.com
 Info@sasmbd.com
 www.google.com
www.allaboutcareers.com
 www.hr.com
Page 53 of 54
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INTERNSHIP REPORT

Compensation and Benefit System

30th June, 2016

Faculty of Business Administration

BGC Trust University Bangladesh

Sub: Submission of Internship Report

Faculty of Business Administration

BGC Trust University Bangladesh

Faculty of Business Administration

BGC Trust University Bangladesh

Human resource is most powerful propeller of a country’s economic growth and

As per my observation, SASM Ltd emphasizes in maintaining a good industrial relations.

Chapter Content Page

Flat steel (mainly CI sheet and CR coil) and

Long steel (MS rod/TMT bar).

1.2RATIONAL OF THE STUDY

1.3.1. Broad objectives:

1.3.2. Specific objectives:

To illustrate various types of allowances and other compensation related facilities

To Understand and analyze the overall activities of SASM Limited.

To evaluate the existing activities and techniques of SASM Limited

To study the operational efficiency of SASM Limited

To relate the theoretical learning with the real life situation

1.4.1. Type of Research:

1.4.2. Types of data collection:

1.4.2.1. Primary data:

1.4.2.2. Secondary data:

 SASM Limited annual report 2013, 2014, 2015.

 SASM Limited statistical report 2015.

 Web site: www.sasmbd.com.

1.4.3. Methods of Primary data collection:

Fill up the questionnaire by questioning. In depth interview with employees of SASM

1.4.4. Sample plan:

The total sample size for the study is 20.

Designation No. of employees

Table: 01. Sample size

The total sample unit is 20.

1.4.5. Data Analysis and reporting:

1.6 LIMITATIONS OF THE STUDY

Up to date information were not available.

Lack of instrumental facilities to get proper information.

Lack of Records, Sufficient books, unavailable information in website. These

SHITALPUR AUTO STEEL MILLS LIMITED is established at 1985 by well known

2.2 MISSION, VISION & ORGANIZATIONAL

To stand out as a pioneer steel industry in Bangladesh and contribute significantly to

High quality services with the help of the latest technology

Fast and accurate customer service.

High standard business ethics.

Steady return on shareholders' equity.

Innovative service at a competitive price.

Attract and retain quality human resource.

Firm commitment to the society and the growth of national economy.

2.2.3. Organizational Objectives:

Make sound investments.

Meet capital adequacy requirement at all the time.

Ensure a satisfied work force.

Ensure 100% recovery of all advances.

Adopt an appropriate management technology

2.3 MAJOR BUSINESS & PRODUCT DIVISIONS

2.3.1. Major Business:

2.3.2. Product Divisions:

Table: 02. Product Divisions