Compensation

Muhammad Adeel & Fakhar Husnain

Agenda

❏ What is Compensation

❏ Different Types of compensation

❏ Weight & Effect of Compensation

Policy for an organization
What is Compensation ?
❏ Employee compensation refers
to the benefits (cash, vacation,
etc.) that an employee receives
in exchange for the service
they provide to their employer.
Types of Compensation

❏ Cash Compensation

❏ wages or Salaries

❏ Retirement Plans

❏ Paid Leaves

❏ Life Insurance

❏ Disability insurance
Cash Compensation

❏ Cash Compensations are all cash

payments earned by an employee in the
form of wages , salaries, overtimes Etc.

❏ TCC (Total Cash Compensation)

❏ Cash Payments earned within a year of full-time
employment
Retirement plans
❏ A retirement plan is a
financial arrangement
designed to replace
employment income
upon retirement.
These plans may be
set up by employers,
insurance companies,
trade unions, the
government, or other
institutions.
Paid Leaves

❏ Paid leaves are generally a pre-

determined number of paid leaves an
employer offers to employees, every
year. This leave is treated more like a
benefit from the employee's point of
view.
Life Insurance

❏ sum of money either on the death of

the insured person or after a set
period.
Disability Insurance
❏ periodic payments of
benefits when a disabled
insured is unable to work

❏ The insurance product is

designed to replace
anywhere from 45 to 65% of
your gross income on a tax-
free basis
Effect on Organization

❏ Employee Motivation

❏ Effectiveness in attracting new Talent

❏ Cost Effectiveness
Cost Effectiveness Ratio

Costnew strategy - Cost Current Practice

❏ Cost Effectiveness Ratio = -------------------------------------------------

Effectnew strategy - EffectCurrent Practice

Questions ?
References

➔Images

◆ http://www.google.com.pk/

➔Contents

◆ http://study.com

◆ http://drive.google.com

◆ http://www.differencebetween.net

◆ http://slideshare.net