SYNOPSIS OF COMPENSATION

MANAGEMENT IN
APTDC

BY: SALEHA GAFFAR

HALL TICKET NO. : 09L51E0042

MBA IV SEM (HR)

INTRODUCTION:

Compensation management or Wage and salary administration affect levels of employee

commitment to the organization. However, fascinating the individual job assignment is, the
employee must be paid. Pay affects the way people work –how much and how well. A large part
of the compensation that people receive from work is monetary.

Meaning:

According to D.S.BEACH “Wage and salary administration refers to the establishment

and implementation of sound policies and practices of employee compensation. It includes such
areas as job evaluation, surveys of wage and salaries, analysis of relevant organizational
problems, payment incentives, profit sharing, wage changes and adjustments, supplementary
payments, control of compensation costs and other related items.”

According to S.P ROBBINS “The term compensation administration or wage and salary
administration denotes the process of managing a company’s compensation program. The goals
of compensation administration are to design a cost effective pay structure that will attract,
motivate and retain competent employees.”

Thus compensation management or wage and salary administration aims to establish and
maintain an equitable wage and salary structure and an equitable labour cost structure.

EMPLOYEE COMPENSATION MANAGEMENT IN APTDC:

In Andhra Pradesh Tourism Development Corporation, employees are compensated

according to the worth of the job. The government of Andhra Pradesh will fix the salaries to the
employees. The board of directors will revise the pay scale of the employees in the corporate
employees.

1. Regular Employees: For Regular Employees the wage is fixed by the board, recently is
being raised the scale of pay in 2005.
2. Contract Employees: For Contract Employees the wage is like a consolidatory pay with
conveyance, allowance i.e., incentives only, they will not get other components for their
wages.
3. Deputation Employees: For Deputation Employees the wage is fixed and pay by parent
organization. The salary is paid by the corporation as per the fixation of their parent
organization. Only the services of the employees is been considered by the corporation.
LITERATURE REVIEW:

1. TREMBLEY, ONYE & TOULAUSE 1997: Compensation policy of organization highly

influence the employee to compare each other performance and work satisfaction

2. ELVIRA, 2001: This is the best way to improve employee motivation and satisfaction by
giving them long term incentives and promotion grants

3. IGLANCE & ROUSSSEL, 1999: Rewards given to the employees has a positive impact on
performance of the employees.

4. HANG, 2004: Pay for performance enhances the employee perception on justice distribution
which finally impacts on satisfaction of employees

5. DELFGAAUW, 2006: Employee satisfaction and job satisfaction are interrelated. If

employees are satisfied then they will never leave the job. Employees leave the job if they are
uncomfortable with job domain.
OBJECTIVES OF COMPENSATION MANAGEMENT:

1. To establish a fair and equitable compensation offering similar pay for similar work.

2. To attract competent and qualified personnel.

3. To retain the present employees by updating wage levels in tune with competitive units.

4. To motivate people to perform better.

5. To minimize the chances of favoritism while assigning the wage rates.

6. To improve morale of employees.

7. To reduce the incidence of quitting, grievances and fractions over pay.

NEEDS OF COMPENSATION MANAGEMENT:

1. The main need of this study is to gain knowledge regarding how compensation packages
are designed by understanding various fringe benefits.
2. To know whether employees are being motivated by the compensation provided to them,
is it in turn motivating them in contributing higher productivity to the organization.
3. To know whether employees are being satisfied by the compensation paid to them.
4. To reduce the incidence of quitting, grievances and fractions over pay.
5. Unless compensation is provided no one will come and work for the organization.
Therefore its main aim is to design such a compensation package by which employees
will retain in the organization.
SCOPE OF COMPENSATION MANAGEMENT:

This project throws light on wage and salary administration.

Compensation management includes various types of incentives, fringe benefits, job evaluation.

The research will help to understand how to design a good compensation package by analyzing
incentives and fringe benefits.
RESEARCH METHODOLOGY

The study is mainly based on primary data and the main sources of primary data are the
employees at APTDC for the purpose of collecting primary data from employees, questionnaires
have been designed and administered to respondents. For collecting the information from the
workmen, personal interviews were held.

SAMPLE:

The required data in personnel research may be obtained by following either the census method
or the sampling method. Under sampling method data are collected about only a part of the
universe called the ‘sample’ and based on this data conclusions are drawn for the whole
population.

SAMPLING TECHNIQUE:

Simple random sampling is used to draw the sample from the population. Here the total
population N=1548

SAMPLE SIZE:

The size of the sample is based on population. Here the sample size is 34 i.e., n=34.

SOURCE OF DATA COLLECTION:

The data for the study is collected from primary and secondary sources.

PRIMARY DATA:

A well structured questionnaire is used to collect the data. It is a combination of closed and open
ended questions covering all the areas of the study.

SECONDARY DATA:

Secondary data is gathered from academic textbooks and company profile books, available.

QUESTIONNAIRE:

No. of questions: 20

Close ended questions: 20

Scale used: Two point scale.