COMPENSATION

MANAGEMENT
CONTENTS
 Introduction

 Objectives

 Components

 Importance

 Factor affecting
 conclusion
INTRODUCTION
 Compensation is a systematic
approach to providing monetary &
non monetary value to employees in
exchange for work performed.
 Compensation may be defined as
money received in performance of
work and many kinds of benefits
that an organization provides to
their employees.
OBJECTIVES
 To recruit &
retain qualified
employees.
 To increase or
maintain
morale.
 To determine
basic wage &
salary.
 To reward for job
performance.
COMPENSATION COMPONENT

compensation

Non monetary
monetary

direct indirect
COMPONENT
Direct compensation

 Base Pay

 Bonus

 Long term incentives

 Perks or perquisites
CONT…
Indirect compensation

 Insurance
(health, eye).
 Leaves (sick,
holiday/personal)
 Clothes

 Company parties

 Phones/laptop

 Retirement programs
NON MONETARY
 Enhance dignity & satisfaction from
work performed.
 Promote social relationship with co-
workers.
 Allocate sufficient resources to
perform work assingments.
 Offer supportive leadership &
management.
 Enhance physiological health,
intellectual growth.
IMPORTANCE
 Job description
 Job analysis

 Job evaluation

 Pay structure

 Salary surveys
FACTOR AFFECTTING
External Internal

 Demand &  Compensation

supply of labour policy
 Cost of living  The org. ability
 Society to pay
 Labour unions  Job analysis &
 The economy description
 Employee
CONCLUSION
We can say that good
compensation can increase the
productivity of an organization
because its provides various
rewards, bonus, schemes etc. and
its compulsary for every
organization.