Employee remuneration

1. HRD EMPLOYEE REMUNERATION

2. WAGE AND SALARY ADMINISTRATION Refers to the establishment and implementation of sound policies and practices of employee compensation Denotes the process of managing a company’s compensation program

3. OBJECTIVES OF WAGE AND SALARY ADMINISTRATION To establish a fair and equitable compensation offering similar pay for similar work To attract competent and qualified personnel To retain the present employees To keep such costs in line with the ability to pay To improve motivation and morale Contd …

4. OBJECTIVES OF WAGE AND SALARY ADMINISTRATION Contd … To improve union management relations To project a good image of the company To comply with legal needs relating to wages and salaries To establish job sequences and lines of promotion wherever applicable To minimize chances of favoritism

5. PRINCIPLES OF WAGE AND SALARY ADMINISTRATION Interest of all parties concerned viz. employer, employees, consumers and the society to be kept in mind Flexible to changes in internal and external conditions of the organization Pay differences to be based on skill, responsibility, efforts and mental and physical requirements Contd …

6. PRINCIPLES OF WAGE AND SALARY ADMINISTRATION Contd … Be consistent with overall organizational plans and programs To be in conformity with social and economic objectives of the country like attainment of equality in income distribution and controlling inflation, etc. Workers should be associated as far as possible Contd ….

7. PRINCIPLES OF WAGE AND SALARY ADMINISTRATION Contd … To be reasonably in line with the prevailing wages and salaries in the labor market Workers should receive guaranteed minimum wages To pay promptly and correctly To be reviewed and revised periodically

8. CONCEPTS OF WAGES Minimum wages Fair wages Living wages

9. MINIMUM WAGE To provide not merely for bare sustenance of life but also for the preservation of the efficiency of the workers Minimum wage must provide for some measure of cost of education, medical requirements and amenities In India, determined mainly under the provision of Minimum Wages Act, 1948

10. FAIR WAGE In a narrow sense, wage is fair if it is equal to the rate prevailing in the same trade and in the neighborhood for similar work In a wider sense, it will be fair if it is equal to the predominant rate for similar work throughout the country

11. LIVING WAGE This is higher than fair wage Enables the wage earner to provide for himself and his family not only the bare necessities like food, clothing and shelter but a frugal comport to meet cost of eduction , medical, social needs, misfortunes and old age Varies from country to country Tribunals, awards and wage boards play major role in fair wage fixation

12. COMPONENTS OF WAGE AND SALARY Financial Non-financial

13. WAGES AND SALARIES Hourly rates of pay Monthly rate of pay Annual increments Differs from employee to employee

14. INCENTIVES Paid additionally Payment by results Individual incentive scheme Group incentive scheme

15. FRINGE BENEFITS PF Gratuity Medical Accident relief Group insurance Canteen facility Uniform Recreation

16. PERQUISITES Allowed to executives Company car Club membership; Paid holidays Furnished house Furniture Stock option

17. NON MONETARY BENEFITS Challenging job Responsibilities Recognition of merit Growth prospects Comfortable working conditions Flexi time

18. FACTORS INFLUENCING WAGES AND SALARIES EXTERNAL FACTORS Demand and Supply Cost of Living Trade Unions’ Bargaining Power Government Legislation Psychological and Social Factors Economy Technological Development Prevailing Market Rates

19. FACTORS INFLUENCING WAGES AND SALARIES Contd … INTERNAL FACTORS Ability to pay Job requirements Management Strategy Employee related Performance Productivity Seniority Experience Potential Luck