PDF

A
PROJECT REPORT
ON
STUDY OF COMPENSATION PRACTICES AT NCL
SUMITTED TO
SAVITRIBAI PHULE PUNE UNIVERSITY
IN PARTIAL FULFIMENT OF THE COURSE
MASTER OF BUSINESS ADMINISTRATION
BY
RAJANIKANT KAMALAKAR KALAL
M.B.A SEMESTER- IV
SIDDHANT INSTITUTE OF BUSINESS MANAGEMENT
PUNE-412109
YEAR-2020-2021
1
DECLARATION
I hereby declare that the project work entitled “Compensation” STUDY

OF COMPENSATION PRACTICES AT NCL (PASHAN) submitted to
SIDDHANT INSTITUTE OF BUSINESS MANAGEMENT, is a
record of an original work done by me. The results embodied in thesis
have not submitted to any other University or Institute.
Mr. Rajanikant Kalal

MBA HRM STUDENT
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ACKNOWLEDGEMENT
I would like to express my sincere thanks to the Savitribai Phule Pune University
and SIDDHANT INSTITUTE OF BUSINESS MANAGEMENT for giving me the
opportunity to prepare and present this report. “There is a good saying that work is
successfully completed if the person is guided properly at the right time by right
person.” Last but not the least I would like to thank my all friends for their
encouragement and direct or indirect support in completion of the project.
RAJANIKANT KALAL
S.Y M.B.A
3
INDEX
Chapter Sub Title Page
Points No.
Chapter 1 Introduction
1.1 Introduction of compensation 7
1.2 Meaning of the compensation 8
1.3 Objectives for research to study 9
compensation
1.4 Limitations of the study research 10
Chapter 2 Literature review 11

2.1 Objectives of compensation 13
2.2 Importance of employees compensation 15
2.3 Nature of employees compenssation 19
2.4 Methods of employees compensation 20
2.5 Advantages of employees compensation 27
2.6 Limitations of employees compensation 30
Chapter 3 Company profile 32

3.1 History 33
3.2 Mission-vision 34
3.3 Pioneering 38
3.4 Patents and publication 39
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Chapter 4 Research methodology 40
4.1 About research 41
4.2 Research methodology 42
Chapter 5 Data analysis 47

5.1 Questionnaire 48
Chapter 6 6.1 Conclusion 77
Chapter 7 7.1 Suggestions 82
Chapter 8 8.1 Bibliography 85
Chapter 9 9.1 Annexure 87
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INTRODUCTION
Compensation administration is one of the most important areas of human resource

management because sound compensation policies, programmes and their effective
execution are essential to procure, maintain and develop the human resource of the
organization to get effective result from them. It involves the selection, designing,
development and direction of programmes designed to implement compensation or
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incentive policy through financial rewards. Beach has defined wage and salary
administration as follows: "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 wages and
salaries, analysis of relevant organizational problems, development and
maintenance of wage structure, establishing rules for administering wages. Wage
payments, incentives, profit sharing, wage changes and adjustments,
supplementary payments, control of compensation costs and other related items".
The traditional concept of wage and salary administration emphasized on only
determination of wage and salary structures in organizational settings. In simple
words, "compensation administration is a systematic procedure for establishing a
sound compensation structure.
The term compensation is used to mean employees' gross earnings in the form of
financial rewards and benefits as part of employment relationship. In terms of
human resource management, compensation is referred to as money and other
benefits received by an employee for providing services to his employer.
Compensation management, also known as wage and salary administration,
remuneration management, or reward management, is concerned with designing
and implementing total compensation package or salary structure.
1.2 MEANING OF COMPENSATION
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Meaning of compensation: “Compensation may be viewed as a system of reward
that motivates an employee to perform better”.
"Compensation means something, such as money, given or received as payment or

reparation, as for a service or loss. Compensation may be defined as money
received in the performance of work, plus the many kinds of benefits and services
that organizations provide their employees."
“Compensation is defined as the total amount of the monetary and non-monetary

pay provided to an employee by an employer in return for work performed as
required. Essentially, it's a combination of the value of your pay, vacation,
bonuses, health insurance, and any other perk you may receive, such as free
lunches, free events, and parking. These components are encompassed when you
define compensation.”
"Compensation includes direct cash payments, indirect payments in the form of

employee benefits and incentives to motivate employees to strive for higher levels
of productivity”. Compensation may be defined as money received n performance
of work and many kind of benefits that an organization provides to their
employees. Compensation also known as wage and salary administration
remuneration management or reward management is concerned with designing and
implementing total compensation package. The traditional concept of wage and
salary emphasized on only determination of wage and salary structure in
organizational setting.
1.3 OBJECTIVE FOR RESEARCH TO STUDY

COMPENSATION
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1. To find out the financial condition of the employees within the organization
and gain knowledge about their compensation package which is provided by the
organization and also to observe their reaction towards compensation benefits
given by company.
2. To study the depth of the interest of the employees in the work
3. To find out health care taken by organization and facilities like LTC,
personality development, fringe benefits, refresher training and development
4. To find out satisfaction level of employees with their remuneration
1.4 LIMITATIONS OF THE STUDY RESEARCH
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 Compensation survey was a quite challenging task for me, I took survey of
many employees, I noticed many types of reaction from different employees
while conducting survey.
 Due to the busy schedule of the employees they were not available on the first
visits. Therefore I have to make several visits to meet one person. This took me
many days for completions of the survey also it took time in finding out new
and topic related questions for the employees. It was a challenging task for me
to make quality questions for the survey.
 Some employees were reluctant to answer the questionnaire, some employees
had fear in their mind to reply the questionnaire, few employees were not aware
of such type of the surveys; it was very new to them.
 I took interview of each and every section of the employees starting from high
post employees to workers. I saw every person has its own opinion about the
surveys some were cooperative and some were not that cooperative also some
of them were average.
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LITERATURE REVIEW
Compensation of employees (CE) is a statistical term used in national accounts,

balance of payment statistics and sometimes in corporate accounts as well. It refers
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basically to the total gross (pre-tax) wages paid by employers to employees for
work done in an accounting period, such as a quarter or a year.
However, in reality, the aggregate includes more than just gross wages, at least in
national accounts and balance of payments statistics. The reason is that in these
accounts, CE is defined as "the total remuneration, in cash or in kind, payable by
an enterprise to an employee in return for work done by the latter during the
accounting period". It represents effectively a total labour cost to an employer, paid
from the gross revenues or the capital of an enterprise.
Compensation of employees is accounted for on an accrual basis; i.e., it is

measured by the value of the remuneration in cash or in kind which an employee
becomes entitled to receive from an employer in respect of work done, during the
relevant accounting period – whether paid in advance, simultaneously, or in arrears
of the work itself. This contrasts with other inputs to production, which are to be
valued at the point when they are actually used.
For statistical purposes, the relationship of employer to employee exists, when

there is an agreement, formal or informal, between an enterprise and a person,
normally entered into voluntarily by both parties, whereby the person works for the
enterprise, in return for remuneration in cash or in kind. The remuneration is
normally based on either the time spent at work, or some other objective indicator
of the amount of work done.
2.1 OBJECTIVE OF COMPENSATION
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1. Entice the employees: Compensation should be high enough to attract the
best talent in an organization. If an organization wants the service of a
competent employee, then the salaries must be high enough to motivate them to
apply and join you.
2. Retain the best talent: An employee would leave an organization if

compensation levels fall. So, it is essential to have a proper compensation
panning to retain the best talents.
3. Ensure equity: Pay should always be equal the worth of the job of an
employee. Employees doing similar jobs should be paid equally and likewise,
more qualified employees should be paid better.
4. Reward new ideas and behaviors: Pay should reward an employee’s

loyalty, commitment towards work, his experience, the amount of risk the job
holds and the initiatives taken. When companies fail to reward such
contributions, employees will fall apart.
5. Cost control: Hiring cost should never be too high. The compensation
planning should ensure that workers are neither overpaid nor underpaid.
6. Compliance: The compensation planning and management should invariably

satisfy governmental compliance of minimum wages, bonus, allowances,
benefits etc.
7. To Attract Top Talent: Rai University states that one of the primary goals
of compensation should be to recruit qualified talent. When you have a
competitive compensation plan in place, you’ll be better able to attract top
industry talent.
8. To Retain & Reward Personnel: Don’t lose your top talent to your
competitors because employees believe that the grass will be greener elsewhere.
Find out market values for your employees and pay accordingly. You can also
set up pay-for-performance models to drive performance by encouraging
associates to reach new goals and push farther.
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9. To Boost Motivation: When structured effectively, your compensation plan
can drive motivation across your teams. Employees who know that they’re
being fairly compensated for their work feel appreciated and are therefore more
likely to stay engaged, committed, and productive. A well-developed
compensation plan can also increase job satisfaction in general, according to
com.
Entice the employees

Retain the best talent
Ensure equity
Reward new ideas and behaviors
Cost control
Compliance
To Attract Top Talent
To Retain & Reward Personnel
To Boost Motivation
2.2 IMPORTANCE OF EMPLOYEES COMPENSATION
The compensation packages that management offer to employees play an

important role in the company’s ability to attract top talent as job candidates. Top-
performing employees greatly impact the competitiveness and productivity of a
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small business. The specific components of an attractive compensation package
vary per employee. A high base salary may attract a top job candidate that is 20-
something and single, while a job candidate with a family may consider a flexible
work schedule extremely important. According to John Rossheim of Monster.com,
recruiters should research a job candidate's current or prior salary and benefits to
get an idea of what is important to the candidate. A well designed compensation
and benefits plan helps to attract, motivate and retain talent in your firm (which is
my Wear). A well designed compensation & benefits plan will benefit your
boutique in the following ways. Employees today are not willing to work only for
the cash alone, they expect 'extra'. This extra is known as employee benefits. Also
known as fringe benefits, Employee benefits are non-financial form of
compensation offered in addition to cash salary to enrich workers’ lives. The more
the compensation and benefits offered to employees, the more is their loyalty,
motivation to work and do well. However, companies which offer lesser salaries
see a high attrition rate and less productivity from employees. All these factors
help in making compensation and benefits an important factor in managing
workforce. Compensation and Reward system plays vital role in a business
organization. Since, among four Ms, i.e. Men, Material, Machine and Money, Men
has been most important factor, it is impossible to imagine a business process
without Men. Every factor contributes to the process of production/business. It
expects return from the business process such as rent is the return expected by the
landlord, capitalist expects interest and organizer i.e. entrepreneur expects profits.
Similarly the labour expects wages from the process.
Employees plays vital role in bringing about the process of production/business in

motion. The other factors being human, has expectations, emotions, ambitions and
egos. Employees therefore expect to have fair share in the business/production
process. Therefore a fair compensation system is a must for every business
organization.
1. Job satisfaction: The employees would be happy with their jobs and would love
to work for company if they get fair rewards in exchange of their services.
2. Motivation: Compensation often impacts an employee’s motivation and job

satisfaction, although it is not the only factor. According to an article written by
Mae Lon Ding of Personnel Systems Associates, compensation systems positively
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impact a large percentage of workers' performances. Many employees feel
motivated to help their companies succeed if the employer shares its profits with
employees, such as with bonuses or profit-sharing plans. The greatest impact of
money on productivity and performance is in jobs where performance is directly
related to compensation. For example, the knowledge of receiving a bonus after
achieving a certain sales quota will likely motivate a salesperson to increase
productivity.
3. Low Absenteeism: Why would anyone want to skip the day and watch not-so-
favorite TV program at home, if they enjoy the office environment and are happy
with their salaries and get what they need and want?
4. Retention: Retaining productive employees is critical to running a successful

business. Retaining employees saves companies money in training costs and helps
maintain an efficient and knowledgeable workforce. Health insurance and
retirement packages are benefits that many employees desire from their employers.
Companies that offer these benefits have a much better chance of retaining workers
than businesses that fail to offer benefit packages. Other ways to retain employees
is through regular promotions, which not only provide an employee with a higher
base salary, but also the ability to take on more responsibility in the workplace.
5. Increased Productivity: By offering employee benefits, the employee gets

more reason to care about the company they are serving and being more dedicated
towards them as much as possible. A happy employee will help in better
productivity for the organization. If the employees working under an organization
seeks attentions from the organization when and where required they in return will
favor hard work with full dedication that will eventually help the organization to
grow and increase profit, quality and productivity will be the outcome from such
dedicated employees.
6.Recruiting: Compensation, whether monetary or in the form of benefits, is a

draw for talent and part of any recruitment strategy. However, compensation isn't
one size fits all. While competitive pay rates are important, some candidates may
value non-cash compensation, such as extra vacation days, for personal reasons.
For example, a person with a small child may be more drawn to a compensation
package that includes extra sick days than a person without children. An employer
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must research potential talent to determine what they're interested in. Getting
information about a candidate's salary and current job benefits may help the
employer determine what they're looking for.
7. Legal Compliance: State and federal laws govern many aspects of the
employee's pay and hours, including what the minimal rate is and how many hours
they may work each week before they're entitled to overtime pay. Employers must
pay workers in accordance with compensation laws to avoid lawsuits and actions
by the state and federal governments. Some rules vary by state and by employee
category. For example, a salaried employee isn't subject to all the same laws as an
hourly worker.
8. Upbringing employees growth: Private as well as the government employees

both contribute their parts for the upbringing of their respective workplace. Not
only in the worldly affairs but within an organization, schemes are given under
which the employee working the most will get additional benefits and for this
policy of reward management things are being initiated across various organization
to keep the employee have the spirit of competency. This competency will drive
the individual to perform better than other employees to get the maximum benefit
out from their work.
9. A step for betterment: The only motive of providing health benefits is to make
the employees healthier so that they can work in the organization for a longer
period of time with full determination and dedication. It is a good plan to offer
medical insurance to the employees and their families. To keep the productivity of
the organization active they need to keep a good and professional attitude. The
more an organization cares about the employee, the more the employee gives in
return to the organization considering the organization as their own being.
10. Improvised self-esteem: Advantages of offering employee benefit helps in

boosting up the self-esteem of the employee. Employee benefit helps in defining,
completing, understanding the needs of the workforce they are intended to work
with. Employees tend to take their job more seriously if any additional offerings
are being provided to them in their workplace. Often the organization shows their
concern about their employee by providing them enough employee benefit that will
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help the employee and organization relationship and bring loyalty amongst each
other.
11. Minimizing the throughput: Often it seems difficult for a business to

maintain its policies if the people working under them are constantly going and
coming around. To show that the organization cares about the employee, it is
required to offer employee benefits for them. Loyalty helps in bringing the people
and the organization closer. By keeping the benefits to the employees it helps them
to stay in the organization for a longer period of time. By minimizing the
throughput and keeping the senior and the most dedicated employees stay in the
organization it will eventually help the organization to grow better.
Job satisfaction
Motivation
Low Absenteeism
Retention
Increased Productivity
Recruiting
Legal Compliance
Upbringing employees growth
A step for betterment
Improvised self-esteem
Minimizing the throughput
2.3NATURE OF EMPLOYEES COMPENSATION
Compensation is what employees receive in exchange for their contribution to the

organization. Generally employees offer their services for their types of rewards.
Pay refers to the base wages and salaries employees normally receive.
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Compensation types such as bonuses, commissions and profit sharing plans are
incentives designed to encourage employees to produce results beyond the normal
expectation. Benefits such as insurance medical, recreational, retirement etc.
represent a more indirect type of compensation. So, the term compensation is a
comprehensive one including pay, incentives and benefits offered by employers for
hiring the services of employees.
In addition to these, managers have to observe legal formalities that offer physical
as well as financial security to employees. All these issues play an important role
in any HR department’s efforts to obtain maintain and retain an effective
workforce. It offered by an organization can come both directly through base pay
and variable pay and indirectly through benefits.
2.4 METHODS OF EMPLOYEES COMPENSATION
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The main purpose of establishing employee compensation system is to value and
price each job. The methods to be followed for the establishment of compensation
are as follows:
1. Job Analysis: Job analysis is known as a process of collecting necessary

information relating to job and its specifications. The required information can be
collected through different methods such as surveys, observation, discussions, and
so on. The information is collected for the preparation of job description and job
specification statements.
i. Job description: Job description is a profile of the job to be performed. It

includes job requirements in terms of duties, responsibilities, authority,
accountability, working condition etc. This tells about the job's contribution to the
organization. This contribution is taken as a base for the compensation
determination.
ii. Job specification: Job specification is a profile of employee’s requirements to

do the job. It specifies minimum qualification, experience and skills of the
employees. This tells about the contribution of employees and tells about the
compensation she/he gets in a competitive market. This is considered as a basis of
compensation determination.
2. Job Evaluation: Job evaluation is a systematic approach of evaluating or rating

or valuing the job in terms of its worthiness, it puts jobs in a hierarchy and assigns
a relative worth of each job so that a pay structure can be determined. It means a
systematic comparison of job is done in order to determine the worth of one job
relative to another. Job evaluation provides an objective ranking of jobs so that an
equitable and appropriate rate of pay can be determined for each job. This provides
a basic ground for the determination of an efficient pay structure through the
identification of compensation factors.
i. Job ranking method: Under this method, all the information regarding the job is
collected. Qualification, skills, challenges, difficulties, complexities, importance,
contribution etc. are taken as a base to rank the job from simplest to the most
complex. Important and challenging jobs are kept at the highest rank. Each job is
compared with others to determine the overall rank. Based upon the challenges and
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contribution of the job, compensation is determined, which sound fair and
scientific.
ii. Job grading method: Under this method, jobs are categorized into grades,
which is a group of different jobs requiring similar skills, efforts and
responsibilities. Each job is assigned into a grade. Responsibilities, skills,
difficulties and effort are common factors used for assigning the grader.
iii. Factor comparison method: In this method, the required environment to each
job is studied and evaluated which serves the basis for compensation
determination. Higher the requirement of these factors for a job, higher will be the
compensation and vice versa.
iv. Point method: It this method, factors are identified for job performance and
each factor is assigned predetermined point or score. After having job
performance, scores of each employee are totaled. And based upon this score, the
compensation is determined instead of total hours spent on working.
3. Compensation surveys: Compensation surveys refer to collecting information

on prevailing market rates through different channels. The information can be
collected through formal or informal surveys. Most employers in a small scale
operation use informal telephone calls to collect data on a relatively small number
of easily identified jobs. This informal telephone call is also a good technique for
checking discrepancies in the wage rate. Under this method, the data and
information relating to other's pay structure are obtained so that the collected data
can serve a standard benchmark for formulating compensation plans and policies.
The required data and information are collected through different sources such as
published surveys, consultants and agencies, advertisements, informal
communication etc. This method collects information from other competing
organization and determines the compensation to make it more competitive.
Compensation is based on the compensation received by employees working at
similar position, qualification, levels of other organization. Based upon this,
average compensation is determined and the compensation is set based upon the
information generated by survey. Published surveys, consultants and agencies,
advertisements and applications, informal communication etc. are the source of
data for compensation survey.
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4. Pricing Jobs: Underpricing jobs method, different pay levels are determined
based on the grade of each job. Firstly the jobs are grouped into pay grades, than,
the pay rates are assigned to each individual pay grade, rather than assigning rate to
each individual job. A pay grade comprises of jobs of approximately equal
difficulty or importance. It means, the jobs having similar nature can be grouped
under a job grade as determined by job evaluation. If we use a point method in it, a
particular grade falls within a range of certain points. For instance 0-50 points, 50-
100 points, and so on. Importance of job performance, contribution and required
skill, capability qualification and experience required for job performance etc, are
analyzed, and evaluated to determine the price of each job responsibility. Based
upon this, the compensation structure of whole jobs is prepared. Jobs of similar
importance are kept under same grade or rank. Importance and market value of
each job is identified. Highly important jobs are highly compensated; lower
important jobs are compensated at lower level. The most important point to
remember is that jobs of similar importance are compensated equally.
5. Base or Guaranteed Pay: The basic cash amount you agreed to pay an
employee is that worker's base or guaranteed pay. In most companies, base pay is
determined by an employee’s job description and position. The company sets a
minimum and maximum range that an employee for a specific position may earn
for the year. This amount can increase, decrease or stay the same, depending on the
employee’s performance.
6. Variable Earnings: Piece-rate plans, merit-based programs, incentive bonuses

and profit-sharing plans are types of variable compensation, which is based on an
employee’s performance or results obtained. Depending on the position, an
employer may combine base and variable pay. This may happen with a salesperson
who receives a salary plus commission or sales bonus. Note that a bonus can be
compensation or a benefit. For example, sales bonuses are compensation but
annual Christmas bonuses are benefits,
7. Equity Compensation: An equity-based compensation program lets you pay

your employees with company shares, such as stock options, restricted stock, stock
appreciation rights, profits interest and restricted stock units. Startup companies
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that cannot afford to pay their employees competitive wages or salaries may offer
equity-based compensation instead, Company can choose to pay the employees
with stock instead of cash; however, this is a tricky process. Obtain legal advice if
company decides to offer stock options as compensation.
8. Voluntary Benefits: Voluntary benefits are Incentives Company choose to

provide the employees; company is not legally required to give them. They might
include paid time off such as vacation, sick, personal and bereavement time and
other forms of leave. Company may also provide medical, dental, disability and
accident insurance; a company vehicle and a cellphone; educational assistance;
dependent care and adoption assistance programs; retirement plans; and
transportation benefits. Moving, meal, travel and lodging reimbursement, wellness
programs, athletic facilities, employee discounts and stock options are also
voluntary benefits.
9. Medical Insurance: Medical insurance covers the costs of physician and

surgeon fees, hospital rooms, and prescription drugs. Dental and optical care might
be offered as part of an overall benefits package. It may be offered as separate
pieces or not covered at all. Coverage can sometimes include the employee's
family (dependents).
Employers usually pay all or part of the premium for employee medical insurance.
Often employees pay a percentage of the monthly cost. The cost of insurance
through an employer
10. Mandatory Benefits: Legally required benefits include Social Security and
Medicare taxes, which are used to fund programs that offer benefits to eligible
retirees and disabled people and beneficiaries. Most employers must also pay
federal and state unemployment insurance, which provides benefits to qualified
unemployed individuals. If companies have employees, they must carry workers’
compensation insurance, which compensates employees who suffer job-related
illnesses or injuries. Depending on the state, they might also need to provide
disability insurance coverage to employees who suffer non-job-related illnesses or
injuries.
11. Fringe Benefits: Fringe benefits are a variety of non-cash payments are used
to attract and retain talented employees. They may include tuition assistance,
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flexible medical or child-care spending accounts (pre-tax accounts to pay qualified
expenses), other child-care benefits, and non-production bonuses (bonuses not tied
to performance).
Tuition reimbursement can be an especially important benefit if it plan to take

classes in the personal time. This can be a great way to advance in career. Most
firms offering tuition assistance require that courses are related to job duties
12. Basic Salary: Salary is that amount which is received by the employee after
some task done by him/her for a certain period of time that can be a day, a week, a
month, etc. It is the wealth employees receive from their company for which they
are working by depiction their services.
13. Rent Allowance: Some of the Organizations either provide accommodations to

its employees who are from different regions, state or country or they provide
house rent allowances to its employees. This is done in order to maintain social
security and to provide motivation in their work.
14. Transportation: Employer provides some transportation facilities to its

employees. Some of the organization also provides petrol allowance and other
allowances also they provide their own transport services in order to pick and drop
to their employees before and after completion of their day to day task. European
Care Group England provides transportation allowance to its employees.
15. Leave Travel Allowance: These types of allowances can be provided to

preserve the best aptitude in the company. Employees are provided allowances to
visit the places that they want to visit with their family members. These allowances
determined according to the position hold by the employees. For example Google
has such compensation system in order to motivate their employees and to make
them innovative.
16. Medical compensation: Most of the Organizations also provide medical

reimbursement to their employees. The employees are provided with medical
claims for them and also their family members. These types of claims include
treatment bills compensation and health-insurances.
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17. Bonus: Bonus is paid to the employees during festive seasons to motivate them
and provide them the social security. The bonus amount usually amounts to one
month's salary of the employee.
18. Special Allowance: Special allowance stands for the allowance such as mobile
allowances, overtime, food/meals commissions, travel expenses, reduction in the
interest loans; insurance etc are provided to employees to provide them social
security and motivate them which improve the organizational productivity.
19. Indirect Compensation: Indirect compensation refers to non-cash benefits

offered to employees in the exchange of the service provided by them to the
organization. They include leave policy, overtime policy, car policy,
hospitalization, insurance, travel assistance limits, retirement benefits, vacation
rentals.
20. Leaving Policy: It is the right of any employees to satisfactory number of

leave during working with the company. The companies provide for paid leaves,
casual browse, medical leaves (sick leave), statutory wage and maternity leaves.
21. Overtime policy: Employees shall with the sufficient allowances and facilities
during their overtime, as he/she is happened to do so, such as transport, overtime
pay, etc.
22. Hospitalization: The employees must be provided compensation to get their

regular check-ups, let's say at an interval even their dependents, should be eligible
for medi-claims that makes the employees stimulated and more secure.
23. Insurance: Organizations also offer for accidental insurance and life insurance
for employees. This gives them the emotional security and they feel valued in the
organization and it also make help them to make more innovative.
24. Let travel: The employees are equipped with leaves and travel expenses to go
for holiday with their families. Some organizations settle for a tour of the
employees of the organization. This is usually done to make the workers be stress
free.
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25. Retirement Benefits: Organizations can provide for their employees in favor
of them after they retire from the organization on the prescribed age for retirement
and other benefits.
26. Social-Security: This will help them to contribute to the safety and security of
themselves and help them to get associated with the organization for a longer
period of time. Retirement plans and other life insurance plans also get into
account for the employees. Retirement plans helps the employees to properly
maintain and get the money as a pension even after they are not working anymore
as an interest of the money they have deposited during the time they were working.
This amount helps them to live their life happily after retirement.
27. Holiday Homes: Organizations offer for holiday homes and guest house for
their employees in different locations. These houses are usually found in hill
station and other most sought after vacation spots. The organizations ensure that
employees are not facing any kind of difficulties during their stay at Guesthouse.
28. Flexible timings: Organizations offer flexible timings to workers who can't
come to work during normal shifts thanks to their personal problems and valid
reasons.
29. Pension Plans: Pension plans are usually classified as either defined benefit or
defined contribution according to how the payments are determined. A defined
benefit plan guarantees a predictable monthly payment at retirement, calculated by
using an established formula with some combination of the employee’s salary,
years of service and/or age.
A defined contribution plan will provide a payment/payout at retirement that will

be determined by the amount of money contributed during the life of the plan and
the performance of the stock or investments used.
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2.5 ADVANTAGES OF EMPLOYEES COMPENSATION
Employee benefits are optional, non-wage compensation provided to employees in

addition to their normal wages or salaries. These types of benefits may include
group insurance (health, dental, vision, life etc.), disability income protection,
retirement benefits, daycare, tuition reimbursement, sick leave, vacation (paid and
non-paid), funding of education, as well as flexible and alternative work
arrangements.
Although expensive, there are many intrinsic benefits to providing the employees
with a comprehensive benefit plan. For most, it is the ability to find and keep
highly qualified staff that is the key driver. With the sector being highly
competitive and the number of new employees entering the workforce dwindling,
employers are challenged to become even more creative and responsive in the
design, timing and generosity of their benefit plans. The more progressive the
organization, the more flexible the structure is in response to today’s challenges:
i.e. like having four different generations of employees working side by side.
Employers who continue to provide the more traditional and limited program, may
find it more difficult to find and keep different types of employees.
An ideal compensation system will have positive impact on the efficiency and
results produced by employees. It will encourage the employees to perform better
and achieve the standards fixed.
27
1. It will enhance the process of job evaluation. It will also help in setting up an
ideal job evaluation and the set standards would be more realistic and achievable.
2. Such a system should be well defined and uniform. It will be apply to all the
levels of the organization as a general system.
3. The system should be simple and flexible so that every employee would be able
to compute his own compensation receivable.
4. It should be easy to implement, should not result in exploitation of workers.
5. It will raise the morale, efficiency and cooperation among the workers. It, being
just and fair would provide satisfaction to the workers.
6. Such system would help management in complying with the various labor acts.
7. Such system should also solve disputes between the employee union and
management.
8. The system should follow the management principle of equal pay.
9. It should motivate and encouragement those who perform better and should
provide opportunities for those who wish to excel.
10. Sound Compensation/Reward System brings peace in the relationship of

employer and employees.
11. It aims at creating a healthy competition among them and encourages

employees to work hard and efficiently.
12. The system provides growth and advancement opportunities to the deserving
employees.
13. The perfect compensation system provides platform for happy and satisfied
workforce. This minimizes the labour turnover. The organization enjoys the
stability.
14. The organization is able to retain the best talent by providing them adequate
compensation thereby stopping them from switching over to another job.
28
15. The business organization can think of expansion and growth if it has the
support of skillful, talented and happy workforce.
16 The sound compensation system is hallmark of organization’s success and

prosperity. The success and stability of organization is measured with pay-package
it provides to its employees.
29
2.6 LIMITATIONS OF EMPLOYEES COMPENSATION
Following are some of the Limitations of employee compensation provided to the

employees.
1. Difficult to keep everyone happy: As in an organization the plans chosen are

such that are benefited for majority of the employees but some or few employees
will not be satisfied with the current chosen policy and with the amount they have
to pay for their portion. The packages chosen by the organization are often not too
delightful and are meant more for their personal benefit. Plans are often changed
every year in different organizations and business which hinders the growth of
employee in the company as the insurance plans get along on the annual basis gets
affected.
2. Legalization and authentication curse: Often the benefits create concerns

regarding legal complaints against both the employees and the organization on
breaking certain policy intentionally or unintentionally. On breaking up of the
specific policy and not paying the retention carries legal fees that need to be
submitted to get out of trouble which at times becomes troublesome.
3. Too expensive for the employees to fit into: No matter how much amount the
health benefits are favoring the company but they still are going to deduce amount
from the employee more than what they actual want to offer. Smaller businesses
are charged more than the other because they do not have many employees within
them while big businesses finds benefit expensive as they need to pay portion of
every employees benefit.
4. Management of budget becomes difficult: The cost associated with the health
insurance is rising day by day which in turn are increasing the turnover rate of the
company. If the cost increases the company for the compensation forces the
employees to give more money to accommodate their plans in the budgets. If the
company cannot afford the increase in insurance, it will force the employee to
switch to a new insurance package which will take a great deal of time to find a
suitable package and then investing in them from the very initials.
30
5. Difficulty in switching: Switching often becomes very difficult to manage and
company loses many employees if proper actions are not being taken. The major
disadvantage associated with it is that the more the employees in the organization
will be, the more the company need to pay to the insurance company to manage the
account of different employees.
6. Difficult to maintain: Additional department needs to be established in a

company to properly manage the plans in the organization which will turn in hiring
additional employees. Some health insurance packages also include help from a
lawyer to make sure that the employees are covered and legal fees and other such
expenses are added easily. Lawsuits are again a curse for the organization.
Lawsuits are sometimes extremely expensive and take great amount of time to
keep it away from any business. Even if the suit makes it to the court it can be very
expensive to pay the legal feel and pay off the fines for its settlement.
Difficult to keep everyone happy
Legalization and authentication
Too expensive for the employees to fit into
Management of budget becomes difficult
Difficulty in switching
Difficult to maintain
31
COMPANY PROFILE
32
3.1 History
National Chemical Laboratory (NCL), a constituent Laboratory of the Council of

Scientific and Industrial Research, New Delhi was formally declared open on
January 3, 1950. Conceived from the vision of the great makers of modern India, it
has celebrated its 60 years of growth and existence during the year 2009-10,
culminating in the Diamond Jubilee of its Foundation on January 3, 2010. Sixty
years is a significant milestone in the history of an institution. NCL has had a
lineage of distinguished leaderships who have guided its destiny at various
milestones of this journey. With its rich tradition of excellence in scientific
research, it has nurtured the best minds of India. It has contributed over the years in
myriad ways to the development of the chemical industry in India. It has partnered
research with some of the largest chemical companies of the world. The mission
and goals of NCL, as stated by its founding fathers, has continued to stay relevant
to the needs of India. It has continually transformed and reinvented itself to meet
the new challenges . While the past is our heritage, the future is our destiny. NCL
is poised to face this future with ever more commitment and passion to ensure that
India is counted amongst the front ranking nations of the world.
33
3.2 Mission and vision
Exploratory research and science
1. Primarily involves explorations on a subject to discover principles and

improve understanding. This is often the necessary precursor to applied
research. Performed largely through research scholars studying for a PhD
under the guidance of our scientists.
2. Activity is often funded by grants and project mode funding from national
and multi-national government agencies. Sometimes funded with a long
term perspective by industry.
3. Output is often in the form of research publications and student dissertations.
4. Outcome is an improved understanding of chemicals, materials, organisms,
phenomenon and techniques that can be used in applied research. Builds
competencies and skills. Keeps researchers current and stimulated.
Contributes to the march of science. The impact is direct and the activity
takes time to deliver benefits.
Applied research and technology
1. Primarily involves research and development directed towards developing a

process, material or product that can deliver potential benefits to industry
and the people at large. Often market driven. Performed largely through
staff, project assistants and sometimes research scholars.
2. Activity is mostly funded by the industry and project mode funding from
national and multi-national government agencies.
3. Output is in the form of patents, non-patented proprietary technology (and

engineering packages), confidential reports to clients and specialized
software.
4. Outcomes include processes, materials and products that are potential wealth
creators. Direct impact on the bottom line of companies through
improvements, alternative cost-effective routes and inventions.
34
Consultancy and scientific services
1. Includes advisory consultancy by our scientists and technologists, process

engineering exercise, reports (feasibility, technology assessment, analysis
for policy etc.), analytical services and information monitoring. Involves
application of expertise, experience and skills, and the use of specialized
facilities to the advantage of our clients. Application of knowledge as
opposed to knowledge creation in the previous two categories. Performed by
the staff directly.
2. Activity mostly funded by industry.
3. Output is in the form of reports (sometimes online reports).
4. Outcomes include solved problems, improvements in the processes,
materials and products, careful decisions on investment and R&D strategy
based on up-to-date information and sophisticated analytical support for our
clients. The benefits to clients are often direct and immediate.
Housing and maintaining national resource centers
1. NCL maintains a unique collection of experts, instrument facilities,

information resources including library, collections of organisms etc. in this
part of the world. We are a national resource center for the chemical and
allied sciences.
2. Many of these resources are the result of the hard work of our scientists and
senior management. In-house funding (from industrial earnings) and
government grants have helped us set up these resources.
3. These resource centers enable research and related activities of NCL and
others outside of NCL. These resources are the life lines of research and
have deeply impact both the scope and quality of research.
Education, training, dissemination and popularization
1. NCL trains one of the largest numbers of PhDs in the chemical and allied
disciplines every year in India. Other than PhD students, many MSc, B.
Tech/ BE students also work on their final year projects at NCL. Many
scientists at NCL teach at local colleges and universities. NCL also conducts
specialized continuing education programs for the industry. We take pride in
disseminating the knowledge that we create at NCL through professional
journals and at conferences worldwide. NCL hosts conferences frequently in
order encourage scientific exchanges. Some of our staff have also written
popular books and articles in newspapers and magazines.
35
2. PhD students are funded by research fellowships from CSIR and UGC.
Continuing education programs are funded by the industry. Various
professional societies, organizations and corporations have funded our
conferences. Popular books and articles are funded by various sources
including grants and sometimes in-house funding.
3. Through these activities we contribute to the creation of specialized
scientific man-power, building of national scientific temperament, and
knowledge dissemination. The impact is often systemic though slow.
Contributions to the scientific professions
The NCL scientific staff contribute to the science and their professions through
publications, organizing and participating in conferences, mentoring the next
generation, serving as editors for several national and international journals,
serving on the executive teams of professional societies and associations, serving
on government committees requiring scientific inputs, serving on UN assignments
etc.
CURRENT MISSION
One of the current missions of CSIR is mass deployment of technologies already
developed at its laboratories for the benefit of society and country. In this direction,
NCL is in the process of identifying such technologies which were developed in
the last few years and with further initiatives with local industry and people, the
technology can provide solutions to human welfare. Another objective is the
creation of scientific temper and deductive thinking approach in students and
youngsters.
SOCIETAL MISSION
Science Outreach programme
This programme is organized by CSIR-NCL scientists and faculty from IISER-

Pune (Indian Institute of Science Education and Research) who wish to share the
excitement of science with school children. Our goal is not to “teach” science but
to “excite” children. We hope that these efforts will excite some children to take up
careers in science and technology while others may grow up to cheer and support
the progress of science
36
Outreach programme (Off-campus)
CSIR-NCL scientists (individually or in group) address students from Higher

secondary schools, science colleges and engineering colleges to attract the talented
students to research as career.
Summer research fellowship programme
The Science Education Panel of Indian Science Academies (Indian Academy of

Sciences, Bangalore, Indian National Science Academy, New Delhi, and The
National Academy of Sciences, Allahabad) offers several two-month Summer
Fellowships to enable students / teachers to work with the Fellows of the these
Academies. Many NCL scientists are the Fellows of these academies and accept
the students / teachers under this scheme. The selected students / teachers are
provided train fare and an honorarium to meet the boarding and lodging expenses
by The Science Education Panel.
Summer / short term projects
Students of recognized Indian Universities / Institutes are allowed access to the

research facilities of CSIR- NCL under the supervision of CSIR- NCL scientists
through summer training / project in the field of chemistry / chemical engineering /
life sciences / plant molecular biology and other areas of interest to CSIR- NCL
scientists.
Education and training
NCL offers specialized hands-on training programs on polymer characterization

techniques, polymer rheology and polymer processing
Institutional visits
CSIR- NCL allows PG students of physical, chemical and life sciences to visit its
facilities and interact with CSIR- NCL scientists.
37
3.3 PIONEERIING
Remembering the Leaders of :
Dr. V. Jagannathan (1921 – 2015)
Dr. V. Jagannathan (1921 – 2015)
Dr. S. Ganguly (1933 – 2015)
Dr. C. Sivaraman (1923 – 2014)
Parthasarathy Ganguly (1942–2014)
Dr. S.C. Bhattacharyya (1918 – 2013)
Sad Demise of Dr. Doraiswamy (1927 – 2012)
Dr. L.K. Doraiswamy ( 1927 – 2012 )
Dr. B.D. Tilak (1918 – 1999)
Prof.John Barnabas ( 1929-1994)
Dr.K.Venkataraman(1901–1981)
3.4 Patents And Publications

38
Publication Data
Year No. of Publications Average IF
2008 420 2.43
2009 376 2.62
2010 344 2.83
2011 372 3.29
2012 444 3.69
2013 447 3.94
2014 540 4.25
2015 541
Patents Data
2008 2009 2010 2011 2012 2013 2014
No. of Patents filed in India 13 20 35 56 86 173 101
No. of Foreign Patents filed 62 10 32 49 96 67 8
External Cash Flow [ ECF ] 2008-09 2009-10 2010-11 2011-12 2012-13

in Lakhs 2105 1914 1315 2335 2191
39
RESEARCH METHODOLOGY
4.1 ABOUT RESEARCH:
40
Research means finding answers to questions. It is a systematic search for
truth. Through research new and original information is obtained. To get them
researcher has to think logically, combine theories and ideas and use their
creativity. This is done by following set rules and procedures and by repeating
steps so that the results obtained are reliable and valid. Thus research is a
collection of methods used systematically to produce knowledge. Thus research
starts off with the problem, collection of data or facts, analysing them critically and
reaches decisions based on the actual evidence.
DEFINITIONS OF RESEARCH:
 “Research is a careful, patient, systematic, diligent enquiry or examination in

some field of knowledge undertaken to establish facts or principles.” –
Webster’s Twentieth Century Dictionary.
 “Research is a systematic, controlled, commercial and critical investigation

of hypothetical propositions about the presumed relations among natural
phenomenon.” – Kerlinger.
 “Research is defined as a careful investigation or inquiry especially through

search for new facts in any branch of knowledge.”- Advance Learner’s
Dictionary of Current English (Oxford)
 “Research is defined as the process which includes defining and re-defining

problems, formulating hypothesis or suggested solutions, collecting
organizing and evaluating data, making conclusions and at last carefully
testing the conclusions to carefully determine whether they fit the
formulated hypothesis.”- Clifford woody
4.2 RESEARCH METHODOLOGY:-
41
Definition of Research Methodology:
”It is the pathway or an approach to get the needed information by locating the
data from different sources which are primary and secondary.”
PRIMARY DATA: -
Primary data is the data is the data which the researcher collects for himself,
for the first time which is original in nature. It is also known as basic or fresh data.
It is obtained through observation or direct communication or by performing
surveys or descriptive research. It is the data a researcher collects to address the
specific problem at hand.
Primary
Data
5-point
Questionnare Interview
Scale
1. Questionnaire or Schedule: Questionnaire is the method commonly used for

data collection in all branches of social sciences.
42
 “Questionnaire refers to a device for securing answers to questions by using a
form which the respondent fills himself.” – Good and Hatt
However there is a minor difference between a questionnaire and a
schedule. Questionnaire is filed up by the respondent himself without any
assistance from the interviewer whereas in schedule the interviewer records
the respondent’s answers.
2. 5 Point Scale: The 5- Point scale method is an innovative method used for
primary data collection. It is a rating in which various tangible and intangible
aspects relating to one’s study can be monitored with the help of this method.
The main advantage of this method is that is the ratings obtained for various
parameters provide a scope for comparative study. And the main limitation is
that since it is based on personal views the markings may be biased.
3. Interview Method: Interview means ‘conversation with a purpose’ or ‘a

process of social interaction’. It is a face to face dialogue of the researcher with
the respondent. Interview method is useful for obtaining in depth information
and knowledge on qualitative variables.
 Advantages of Primary Data:- The following are the advantages of

primary data
 Primary data collection is more reliable as compared to secondary

and tertiary data.
 Primary data is more suitable to the nature of the problem than

secondary or tertiary data.
 Primary data is the first hand information of the situation. It is unused

and unmodified.
43
 Primary data is collected by the researcher himself and therefore
chances of occurrence of errors are very less.
 Primary data is the only source for collection of qualitative data like
personal qualities and attitudes.
 Limitations of Primary Data:- The following are the limitations of primary

data
 Collection of primary data is more time consuming and costly procedure as

compared to secondary and tertiary data.
 Primary data collection requires trained personnel for the purpose who are
dedicated towards field work.
 Primary data alone cannot assist in a complete research process it requires

assistance from secondary data also.
 Primary data collection may at times involve manipulation of data by the

researcher and fail to give true results.
 Primary data collection is not always possible and has some constrains
pertaining to privacy.
 SECONDARY DATA: -
Secondary data is the data collected processed and published by someone
else either for his personal use or for public use. This data is not originally
collected by the researcher but obtained from published or unpublished
sources.
44
Secondary
data
Periodicals
Books Internet
& Journals
 Advantages of Secondary Data:- The advantages of secondary data are:
 Secondary data collection is cost effective and less time consuming as

compared to primary or tertiary data.
 Secondary data helps to understand the problem and become familiar

with the topic.
 At times primary research is not possible due to time, cost constrains and
security reasons secondary data then aids the researcher.
 Secondary data can help to relate with the social ethos of a particular
period.
 Limitations of Secondary Data:- The limitations of secondary data are:
45
 Secondary data is the data collected by others for their needs and may
not suit us.
 It is also difficult to test the accuracy of the data as this data is always
old and may at times be outdated.
 In case of over information and fake information authenticity of

information is questionable.
 Compilation of secondary data is difficult as the previous researcher has

modified it to suit his needs.
The topic for project study is
A Study Of Employees Compensation Practices At National Chemical

Laboratory Pashan
‘The purpose of the National Chemical Laboratory was selected to identify the
compensation policies within the organisation
1. Questionnaires was filled by every employee
2. Personal interviews with the employees in order to know about the

compensation package given to them.
3. Books, references, periodicals internet for the theoretical background.
46
DATA ANALYSIS
47
Q.1 What is the average working duration/ hour?
Parameters responses
8 hours 17
10 hours 9
7 hours 2
12 hours 2
Working Duration/ Hours

12 hours
7%
7 hours
7%
10 hours 8 hours
30% 57%
Inference:58% of the employees say that they work for 8 hours,31% of the
employees say that they work for 10%,7% of them sat they work for 7
hours,7% of them say that they work for 12 hours
48
Q2. Is your organization recognized as?
Public sector 0
Private sector 0
Semi government 0
Government 30
35
30
25
20
15
10
0
Public sector Private sector Semi government Government
Organization Recognized As
Inference: All of them say that it is a government organization
49
Q.3 Do you feel secure in your job?
YES 30
NO 0
35
30
25
20
15
10
0
YES No
Feel Secure In Job
Inference: All of them say that they feel secure in their jobs
50
Q.4 How you are paid?
Weekly 0
Semi-Monthly 0
Once a Month 30
Other 0
35
30
25
20
15
10
0
Weekly Semi-Monthly Once a Month Other
How Employees Are Paid
Inference: All of them say that they are paid once in a month
Q.5 Do you think company provides satisfactory salary according to the

work?
51
Strongly Agree 12
Agree 15
Neutral 0
Disagree 1
Strongly Disagree 2
Satisfactory Salary According To The Work

Strongly Disagree
7%
Disagree
3%
Strongly Agree
40%
Agree
50%
Inference: 40% of them says strongly agree that company provides

satisfactory salary, ,50% of them says agree,0% of them says neutral,3% of
them says disagree,7% of them says strongly disagree
Q.6 Is your work according to your qualification and skills?
52
Strongly Agree 18
Agree 8
Neutral 3
Disagree 1
Strongly Disagree 0
Qualification and Skills

Disagree
3%
Neutral
10%
Agree StronglyAgree
27%
60%
Inference: 60% of them says strongly agree, 27% of them says agree,10% of
them says neutral,3% of them says disagree and 0% of them says strongly
disagree
Q.7 Does your organization give a Special Allowance?
53
YES 7
NO 23
Special Allowance
YES
23%
NO
77%
Inference: 23% of them say Yes that they get special allowance and 77% of
them says No
Q.8 Does your organization offer salary increment?
54
YES 30
NO 0
35
30
25
20
15
10
0
YES NO
Organization offer salary increment
Inference: all of them say that they get salary increment
Q.9 If yes how often does the salary increment take place?
55
Half yearly 4
Annually 26
Every five years 0
Salary increment
Half yearly
13%
Annually
87%
Inference: 13% of them says half yearly,87%of them says annually and 0% of
them says every five years
Q.10 State whether your organization pays you incentives or bonus?
56
YES 9
NO 21
Incentives or Bonus
YES
30%
NO
70%
Inference: 30% of them say yes that they get bonus and incentives from
organisation and 70% of them says no
Q.11 Do you see your personal & professional growth in the organization?
57
YES 28
NO 2
Personal & Professional growth
NO
7%
YES
93%
Inference: 93% of them say yes that they feel personal and organizational
growth and 7% of them says no
Q.12 In your present employment, when did you last get promotion?
58
1 year back 6
2 year back 1
3 year back 1
5 year back 20
Others 2
Last Promotion
Others
7%
1 year back
20%
2 year back
3%
3 year back
3%
5 year back
67%
Inference: 20% of them says 1 year back they got promotion,3% of them says
2 years back,3% of them says 3 years back, 67% says 5 years back and 7% of
them says others
Q.13 Does your company utilize a traditional salary grade system?
59
Cheque 0
Cash 0
Bank 30
35
30
25
20
15
10
0
Cheque Cash Bank
Traditional salary grade system
Inference: All of them says bank as their traditional salary grade system
Q.14 Does your organization provide the life insurance facility?
60
YES 13
NO 17
Life Insurance Facility
YES
43%
NO
57%
Inference:43% of them says yes that company provides life insurance facility
and 57% of them says no
Q.15 How many leaves you can take in a year?
61
Less than 5 3
Less than 15 13
Less than a month 14
Holidays
Less than 5
10%
Less than a month

47%
Less than 15
43%
Inference:10% of them says less than 5,43% of them says less than 15,47% of
them says less than a month
Q.16 Does your organization provides you with relocation charges/moving

allowance?
62
YES 11
NO 19
Relocation Charges/Moving Allowance
YES
37%
NO
63%
Inference:37% of them says yes that organization provides relocation charges

and 63% of them says no
Q.17 Is maternity benefits provided to female employees?
63
YES 30
NO 0
35
30
25
20
15
10
0
YES NO
Maternity Benefits To Female Employees
Inference: All of them say that female employees in the organization gets
maternity benefits
Q.18 If above is yes, how many years of continuous service is required for the
same?
64
2 years 9
5 years 0
4 years 0
1 years 21
Years Of Maternity Benefits
2 years
30%
1 years
70%
Inference: 30% of them says 2 years,0% of them says 5 years,0% of them says
4 years and 70% of them says 1 year
Q.19 Are you eligible for fringe benefits?
65
YES 28
NO 2
Fringe Benefits
NO
7%
YES
93%
Inference: 93% of them say yes that they get fringe benefits and 7 % of them
says no
Q.20 Do you get transport allowance?
66
YES 28
NO 2
Transport Allowance
NO
7%
YES
93%
Inference:93% of them says yes and 7 % of them says no to transport

allowance
Q.21 Out of the following benefits what benefits are you provided with?
Gratuity 22
Yearly bonus 0
67
Worker compensation 0
Medical insurance 7
Employee state level insurance 0
All of the above 0
Following Benefits
Medical insurance
24%
Gratuity
76%
Inference: 76% of them says Gratuity,0% says Yearly bonus,0% says worker
compensation, 24% says medical insurance,0% says employee state level
insurance,0% says all of the above
Q.22 Whether you are insured by the organization?
68
YES 20
NO 10
Insured By The Organisation
NO
33%
YES
67%
Inference:67% of them says yes that they are insured by organisation and
33% of them says no
Q.23 Is any contribution deducted from your salary for employer welfare
related fund?
69
YES 28
NO 2
Employer Welfare Related Fund
NO
7%
YES
93%
Inference: 93% of them say yes that the contribution deducted from salary for
employer welfare fund
Q.24 Does your HR or accounts undertakes tax planning initiatives for you?
70
YES 5
NO 25
Tax Planning Initiatives
YES
17%
NO
83%
Inference:17% of them says yes to tax planning initiatives and 83%

of them says no
Q.25 What medical policy do you follow?
71
Cost reimbursement of medicines 0
Hospitalization reimbursement cost 0
Accidental cost 0
All of the above 30
35
30
25
20
15
10
5
0
st
ve
l co
abo
nta
he
ide
es
of t
t
cos
Acc
cin
All
edi
ent
fm
sem
o
bur
ent
sem
eim r
bur
on
reim
izati
ital
t
Cos
sp
Ho
Medical Policy
Inference: all of them say all of the above
Q.26 What motivates you the most?
72
Family 19
Colleagues 6
Company policy 0
Compensation package 0
Retirement package 5
Motivation
Retirement package
17%
Colleagues
20%
Family
63%
Inference: 63% of them says family,20% of them says colleagues,0% says

cpmpany policy,0% says compensation package,17% of them says retirement
package
Q.27 How would you rate the level of pressure to perform better?
73
Low 7
Moderate 21
High 2
Level Of Pressure
High
7%
Low
23%
Moderate
70%
Inference:23% of them says low,70% of them says moderate and 7% of them

says high
Q.28 What is the current retirement age?
74
58 0
60 30
62 0
65 0
35
30
25
20
15
10
0
58 60 62 65
Current Retirement Age
Inference: all of them say that the current retirement age is 60
Q.29 Rate your level of satisfaction with respect to compensation of the

organization?
75
Poor 0
Fair 1
Good 7
Very good 18
Excellent 4
Level Of Satisfaction
Fair
3%
Excellent
13%
Good
23%
Very good
60%
Inference: 0% says poor,3% says fair,23% says good,60% says very

good,14% says excellent
76
CONCLUSION
77
Conclusion: 56% of the respondent said that they work for 8 hours, also 30% of
them said that they work for 10 hours and 7% of them said 7, 12 hours.
Conclusion: All of them said that ncl is a government organization. 100% of them
said that it is a government body in which they are working.
Q.3 Do you feel secure in your job?
Conclusion: All of them said that they feel secure in their job. Nobody said no.
Conclusion: 100% of the employees said that they are paid once in a month.

work?
Conclusion: Maximum of the respondent said that they agree that company
provides them satisfactory salary according to their work, also 40% of them said
that they strongly agree, 7 % of them said that they are not satisfy by the salary the
get by the company.
Conclusion: Most of the respondent rated that they strongly agree that their work
is according to their qualification and skills. They believe that their job is
according to their education and skills.
Conclusion: Maximum of them chosen no that the organization does not give
them any special allowance. It shows that employees are not at all happy with the
organization in case of special allowance.
Conclusion: 100% of them said yes that the organization offer them salary
increment time to time. No one said no.
78
Conclusion: Maximum of the respondent chosen annually as the company
provides them salary increment every annual, also some them said that company
give them salary increment every half yearly.
Conclusion: Maximum of the respondent chosen no they don’t get any incentives
or bonus from the organization. Employees are not satisfied because they don’t get
any bonuses from the organization.
Conclusion: Maximum of the respondent chosen yes that they can see their
personal and professional growth in the organization, very few of them chosen no.
Conclusion: Maximum of the respondent said that they got last promotion 5 years
back, some of them said they got their last promotion 1 year back.
Conclusion: 100% of the employees chosen bank as their traditional salary grade
system.
Conclusion: Most of them said No, almost 57% of them said No and 43% of them
said yes. It seems organization provides life insurance facility to limited employees
only.
Conclusion: 47% of them choose less than a month 43% of them choose less than
15 and 10% choose less than 5. It seems every employee has different leave taking
period.

allowance?
79
Conclusion: Maximum of the respondent chosen no that they don’t get any
relocation charges/moving allowance from the organization. Employees working in
the organization doesn’t get any relocation charges/moving allowance.
Conclusion: 100% of the employees chosen that maternity benefit is provided to

female employees, No one said no.
same?
Conclusion: Most of them said 1 year of continuous service is required for the
maternity benefits to female employees.
Conclusion: Maximum of the respondent chosen Yes that they are eligible for the
fringe benefits, only 7 % of them said No that they are not eligible for fringe
benefits.
Conclusion: Maximum of the employees said yes that they get transport allowance
and very few said that they don’t get any transport allowance from the
organization, hence transport allowance is provided to maximum number of
employees.
Conclusion: 76% of the employees chosen gratuity and 24 % of the employees

chosen medical insurance, thus gratuity benefit is provided to maximum number of
employees.
Conclusion: 50% said yes and 50 % said no that they are not insured by the
organization.
related fund?
80
Conclusion: Maximum of the respondent said yes that contribution is deducted
from their salary for employer welfare related fund, organization deducts some
amount of money from salaries of employees.
Conclusion: Maximum of the respondent chosen no, HR or accounts doesn’t

undertake tax planning initiatives for them.
Conclusion: Employees said they follow all of the above medical policy such as
Cost reimbursement of medicines, Hospitalization reimbursement cost and
Accidental cost.
Conclusion: 63 % of the employees answered family and 20 % of them said

colleagues, and 17% of them said retirement package. It seems that most of the
employee’s motivation is there family.
Conclusion: Maximum of the respondent said that they have moderate level of
pressure, some of them said low and very few of them said high. It seems that most
of the employees in this organization have moderate level of pressure.
Conclusion: 100% of the employees chosen 60 is the current retirement age.

organization?
Conclusion: Maximum employees says that their compensation levels are

according to their expectation because excellent is 14% ,very good is 60%,good is
23%,fair is 3% and 0% says its poor . Most of the employees are happy very few
are not happy because 3% of employees chosen fair.
81
SUGGESTION
Recommendations To Motivate The Employees
82
Pay employees salary and incentives.
Company should provide satisfactory salary to those who deserve and those who
work hard. The companies with the highest employee morale and productivity pay
a mix of salary and incentives. The salary compensates employees for performing
all the tasks required of them and provides them with a consistent income. The
incentive (which can be commission for salespeople and a bonus for others)
motivates them to meet and exceed their goals and gives them the opportunity to
increase their earnings.
Keep the incentive part of your plan simple.
It is suggested that performance factors of the employees should be considered for

the incentive, a simple plan should be followed to study the performance and give
the incentives to them so that they will be happy and their productivity will
increase. Other employees will also try to increase their productivity.
Use merit increases to reward top performers.
It is recommended that the employees performance should be measured in merit

form those who achieved highest performance should be given highest incentive/
Bonus/Pay grade / Promotions, this will encourage the other employees and they
will also attempt to increase their productivity.
Provide employees with non-financial rewards.
It is suggested, besides cash, employees are motivated by other forms of

recognition and rewards. The employees and their families should be given chance
to travel in India as well as aboard depending upon their performance also all the
employees should have get to gather with family for lunch/Dinner this will result
keeping employees happy and motivate them to increase their performance.
Arrange Lectures
83
Experts in different filed like medical, literature, entertainment should be invited
and they should react with employees and their family members. Naturally the
employees will get awareness about their medical problems literature will change
their thinking way entertainment will help them to change their mood and they will
come out of tension/ depression this will play very important role in the life of
employees and their families.
84
BIBILIOGRAPHY
85
Book Publication Edition Author
Human resource Publication house K. Ashwathapa

and Himalaya 2006
personal
management
Human resource Publication 2006 L.M Prasad
sultan chand and
sons
Human resource Publication house V.S.P Rao
and Himalaya 2006
management
86
ANNEXURE
A) 8 Hrs
B) 10 Hrs
87
C) 7 Hrs
D) 12 Hrs
A) Public sector
B) Private sector
C) Semi government
D) Government
Q3. Do you feel secure in your job?
A) Yes
B) No
A) Weekly
B) Semi-Monthly
C) Once a Month
D) Other ___________________

work?
A) Strongly Agree
B) Agree
88
C) Neutral
D) Disagree
E) Strongly Disagree
A) Strongly Agree
B) Agree
C) Neutral
D) Disagree
E) Strongly Disagree
A) Yes
B) No
A) Yes
B) No
A) Half yearly
B) Annually
C) Every five years
89
A) Yes
B) No
A) Yes
B) No
A) 1 year back
B) 2 year back
C) 3 year back
D) 5 year back
E) Others ___________________
A) Cheque
B) Cash
90
C) Bank
A) Yes
B) No
A) Less than 5
B) Less than 15
C) Less than a month

allowance?
A) Yes
B) No
A) Yes
B) No
same?
A) 2 years
B) 5 years
91
C) 4 years
D) 1 years
A) Yes
B) No
A) Yes
B) No
A) Gratuity
B) Yearly bonus
C) Worker compensation
D) Medical insurance
E) Employee state level insurance
F) All of the above
A) Yes
B) No
92
related fund?
A) If yes how much ___________________
B) No
A) Yes
B) No
A) Cost reimbursement of medicines
B) Hospitalization reimbursement cost
C) Accidental cost
D) All of the above
A) Family
B) Colleagues
C) Company policy
D) Compensation package
93
E) Retirement package
A) Low
B) Moderate
C) High
A) 58
B) 60
C) 62
D) 65

organization?
A) Poor
B) Fair
C) Good
D) Very good
E) Excellent
DATE: PLACE: SIGNATURE:
94
95

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A

I hereby declare that the project work entitled “Compensation” STUDY

Mr. Rajanikant Kalal

Chapter 2 Literature review 11

Chapter 3 Company profile 32

Chapter 5 Data analysis 47

Chapter 6 6.1 Conclusion 77

Chapter 7 7.1 Suggestions 82

Chapter 8 8.1 Bibliography 85

Chapter 9 9.1 Annexure 87

Compensation administration is one of the most important areas of human resource

1.2 MEANING OF COMPENSATION

"Compensation means something, such as money, given or received as payment or

“Compensation is defined as the total amount of the monetary and non-monetary

"Compensation includes direct cash payments, indirect payments in the form of

1.3 OBJECTIVE FOR RESEARCH TO STUDY

2. To study the depth of the interest of the employees in the work

4. To find out satisfaction level of employees with their remuneration

1.4 LIMITATIONS OF THE STUDY RESEARCH

Compensation of employees (CE) is a statistical term used in national accounts,

Compensation of employees is accounted for on an accrual basis; i.e., it is

For statistical purposes, the relationship of employer to employee exists, when

2.1 OBJECTIVE OF COMPENSATION

2. Retain the best talent: An employee would leave an organization if

4. Reward new ideas and behaviors: Pay should reward an employee’s

6. Compliance: The compensation planning and management should invariably

Entice the employees

2.2 IMPORTANCE OF EMPLOYEES COMPENSATION

The compensation packages that management offer to employees play an

Employees plays vital role in bringing about the process of production/business in

2. Motivation: Compensation often impacts an employee’s motivation and job

4. Retention: Retaining productive employees is critical to running a successful

5. Increased Productivity: By offering employee benefits, the employee gets

6.Recruiting: Compensation, whether monetary or in the form of benefits, is a

8. Upbringing employees growth: Private as well as the government employees

10. Improvised self-esteem: Advantages of offering employee benefit helps in

11. Minimizing the throughput: Often it seems difficult for a business to

2.3NATURE OF EMPLOYEES COMPENSATION

Compensation is what employees receive in exchange for their contribution to the

2.4 METHODS OF EMPLOYEES COMPENSATION

1. Job Analysis: Job analysis is known as a process of collecting necessary

i. Job description: Job description is a profile of the job to be performed. It

ii. Job specification: Job specification is a profile of employee’s requirements to

2. Job Evaluation: Job evaluation is a systematic approach of evaluating or rating

3. Compensation surveys: Compensation surveys refer to collecting information

6. Variable Earnings: Piece-rate plans, merit-based programs, incentive bonuses

7. Equity Compensation: An equity-based compensation program lets you pay

8. Voluntary Benefits: Voluntary benefits are Incentives Company choose to

9. Medical Insurance: Medical insurance covers the costs of physician and

Tuition reimbursement can be an especially important benefit if it plan to take

13. Rent Allowance: Some of the Organizations either provide accommodations to

14. Transportation: Employer provides some transportation facilities to its

15. Leave Travel Allowance: These types of allowances can be provided to

16. Medical compensation: Most of the Organizations also provide medical

19. Indirect Compensation: Indirect compensation refers to non-cash benefits

20. Leaving Policy: It is the right of any employees to satisfactory number of

22. Hospitalization: The employees must be provided compensation to get their

A defined contribution plan will provide a payment/payout at retirement that will

Employee benefits are optional, non-wage compensation provided to employees in

4. It should be easy to implement, should not result in exploitation of workers.

8. The system should follow the management principle of equal pay.

10. Sound Compensation/Reward System brings peace in the relationship of

11. It aims at creating a healthy competition among them and encourages

16 The sound compensation system is hallmark of organization’s success and