CHRA Reviewer
>1/12 of the basic salary of an employee within the calendar
Labor Standard - Refer to the Philippine Law that provides the
minimum requirements regarding work conditions, work hours,
wages, benefits, and other employment conditions that are
being implemented by the management.
Labor Relations - The goal of labor relations is to strike a
proper balance between the protection of worker rights versus
the exercise of management prerogatives. By the employer in
accordance with law and to achieve industrial peace.
Section 3. Art. 13 - The state shall promote the full protection
of labor, local and overseas, organized, and unorganized and
promote full employment and equality of employment
opportunities for all. (Guarantee the right of all workers to self-
organization, they shall be entitled to security of tenure.)
Presidential Decree 442 Labor Code
Article 3. Declaration of Basic Policy - The state shall afford
protection of labor, promote full employment, ensure equal work
opportunities regardless of sex, race, or creed.
Article. 4 Construction in favor of labor - All doubts in the
implementation and interpretation of the provisions of this Code,
including its implementing rules and regulations, shall be
resolved in favor of labor.
The four-fold test:
- Selection and engagement of the employee
- Payment of wages,
- Power of dismissal
- Control test (most important element) if all of these are
present, there is an employer and employee relationship.
Min wage - Lowest amount of wage that an employer will pay
to an employee. (Floor by the employer and employee can
negotiate to a much higher wage)
>Exempted from paying min wages-distress establishment, new
business enterprises, retail and service-not more than 10
employees, establishment affected by natural calamity.
Overtime, Holiday, Premium, Night Shift, Differential pay - at
least 25% for overtime work rendered on a holiday or rest day
> If it is holiday and at the same time rest day of an
employee it will be 50%
> Overtime is not presumed.
> Art. 93 COMPENSATION FOR REST DAY, SUNDAY, OR
HOLIDAY
> Art. 86 Night Shift Differential, not less than 10% if u work
between 10am to 6am
> Art. 94 Right to holiday pay - Double pay or 200% if the
employee work on a holiday, 100% if not.
- Every worker shall be paid regular wage during regular holiday
except establishment with less than 10 employees
13th Month pay and Bonus PD No. 851
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>Not later than dec 24 every year
year (multiply your basic salary by the no. of months you have
worked for the entire year then divide it by 12)
Service Leave, Maternity Leave and Magna Carte for
women PD 442, Art 95. Service Incentive Leave.
>Every employee who has rendered at least 1 year id service
shall be entitled to a yearly service incentive leave of 5 days with
pay.
R. A No. 9710, Sec. 18. Special Leave Benefits for Woman
> A woman employee who rendered at least 6 months for the
last 12 months should be entitled
to a special leave benefit for 2 months with full pay based on her
gross monthly compensation
following surgery caused by gynecological disorders.
Paternity, Solo parent, VAWC Leave RA 8972: Solo parents
welfare act of 1996 Section 8. Parental Leave. 7 days leave
every year for the solo parent who has rendered service of at
least 1 year
RA No. 8187 Paternity Leave Act of 1996. Sec. 2. 7 days with
full pay for the first four deliveries of a legitimate spouse.
RA 9262 Anti - violence against women and their children
act 0f 2004. Sec. 43 Entitled to leave - paid leave absence up
to 10 days in addition to other paid leaves under Labor Code
and Civil Service Rules
RA No. 11210 Expanded Maternity Leave
>105 paid leave for live birth
>7 days leave transferable to the father (bukod pa to sa paternity
leave)
>15 days additional paid leave for Solo parent under RA 9972
>30 days add. Leave without pay
>60 days paid leave by miscarriage, abortion
Retirement Pay Art. 287. Any employee may be retired upon
reaching the retirement age established in the collective
bargaining agreement or another applicable employment
contract.
> Retirement entitled to ½ month salary for every year of service,
a fraction of 6 months could
be considered as one whole year.
> 60 y/o or 65y/o
Separation Pay Art 283. Closure of establishment and
reduction of personnel.
>Written Notice to the department of labor and employment for
at least 1 month.
>Separation pays to at least 1 month pay for every yr. of service,
whichever is higher.
>Exceptions: When the establishment is closed due to serious
financial causes, or the company cannot recover.
 SSS, Pag ibig, Philhealth.
R.A No. 11199 Social Security Act of 2018.Section 2.
Declaration Policy. Policy of the state to establish, develop,
promote, and perfect a sound and viable tax-exempt social
security system suitable to the needs of the people throughout
the Philippines.
PD N0. 1752 as amended, home development mutual fund law
of 1980
> Sec. 2 - Policy of the RA of the Ph to motivate the employed
and other earning groups to
better plan and provide for their housing needs
R.A 10606 National health insurance Act of 2013
> Sec. 2 Declaration of Principles and Policies -
to make essential goods, health, and other social services
available to all people
Human Resource Management (HRM) – A relatively new
approach to managing people in any
organization.
4 Main Activities of HRM:
1. Acquisition
2. Development
3. Motivation
4. Maintenance of Human Resources
Inherent Part of Management - Features of HR Management;
If a manager is to get the best of his people, he must undertake
the basic responsibility of selecting people who will work under
him.
Pervasive Function - Features of HR Management; HR
Management is not a responsibility that a manager can leave
completely to someone else. However, he may secure advice
and help in managing people.
Basic to all Functional Areas - Features of HR Management;
Every manager from top to bottom, working in any department
must perform the personnel functions.
People Centered - Features of HR Management; It is
concerned with all categories of personnel from top to the
bottom of the
organization.
>Blue-collar workers (Working on machines and engaged in
loading, unloading, etc.)
>White-collar workers (Clerical Employees, Managerial and
Non-managerial personnel, professionals)
Personnel Activities or Functions - Features of HR
Management; Includes manpower planning, employment,
placement, training, appraisal, and compensation of employees
Based on Human Relations - Features of HR Management;
HR Management is concerned with the motivation of human
resources. The managers should give attention to the different
needs, perceptions, and expectations of employees.
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Continuous Process - Features of HR Management; It must be
performed continuously if the organizational objectives are to be
achieved smoothly.
Planning - Managerial Functions; steps taken in determining in
advance personnel requirements, personnel programs, policies,
etc. After determining how many and what type of people are
required, a personnel manager has to devise ways and means
to motivate them.
Organizing - Managerial Functions; organizing the operative
functions by designing structure of relationship among jobs,
personnel, and physical factors.
Personnel manager performs
(a) preparation of task force,
(b) allocation of work to individuals,
(c) integration of the efforts of the task force,
(d) coordination of work of individuals with that of the
department.
Directing - Managerial Functions; concerned with initiation of
organized action and stimulating the people to work.
- The personnel manager directs the activities of people
of the organization to get its function performed
properly.
Controlling - Managerial Functions; provides basic data for
establishing standards, makes job analysis and performance
appraisal.
Procurement of Personnel - Operative Functions; concerned
with the obtaining of the proper kind and number of personnel
necessary to accomplish organizational goals.
Development of Personnel - Operative Functions; this has to
do with the increasing skills of the employees necessary for
proper job performance through training.
Compensation to Personnel - Operative Functions;
determination of adequate and equitable remuneration of
personnel for their contribution to organization's objectives.
Maintaining Good Industrial Relation - Operative Functions;
intended to reduce strife, promote industrial peace, provide fair
deal to workers, and establish industrial democracy.
Record Keeping - Operative Functions; evaluation of
performance, personnel policy of an organization and its
practices, personnel audit, morale, survey, and performance
appraisal.
Human Resource Planning - can be defined as the process of
determining manpower requirements and the means for
meeting those requirements to carry out the integrated plan of
the organization.
 Forecasting - Human Resource Planning Activities; projecting
future manpower requirements
Inventory of Present Manpower Resources - Human
Resource Planning Activities; assessing the extent to which
these resources are employed optimally
Anticipating Manpower Problems - Human Resource
Planning Activities; projecting present resources into the future
and comparing them with the forecast of requirements to
determine their adequacy, both quantitatively and qualitatively.
Planning - Human Resource Planning Activities; preparation of
the necessary programs of requirements, selection, training,
development, utilization, transfer, promotion, motivation, and
compensation to ensure that future manpower requirements are
properly met.
Forecasting Demand for Human Resources - Steps in
Human Resource Planning; Human resource planning starts
with the estimation of the number and type of personnel required
at different levels and in different departments.
Analysis of Organizational Plans and Objectives - Steps in
Human Resource Planning; Human resource planning is a part
of the plan of an organization. Plans concerning technology,
production, marketing, finance,
expansion and diversification give an idea about the volume of
future work activity. Each plan can further be analyzed into sub-
plans and detailed programs. It is also necessary to decide the
time horizon for which human resource plans are to be
prepared. The future organization structure and job design
should be made clear and changes in the organization structure
should be examined to anticipate its manpower requirements.
Estimating Manpower Gaps - Steps in Human Resource
Planning; Net human resource requirements or manpower gaps
can be identified by comparing demand and supply forecasts.
Such a comparison will reveal either deficit or surplus of human
resources in future. Deficits suggest the number of persons to
be recruited from outside whereas surplus implies redundant to
be redeployed or terminated. Similarly, gaps may occur in terms
of knowledge, skills, and aptitudes. Employees deficient in
qualifications can be trained whereas employees with higher
skills may be given more enriched jobs.
Forecasting Supply of Human Resources - Steps in Human
Resource Planning; to deal with allocation of persons to different
departments depending upon the workload and requirements of
the departments. While allocating manpower to different
departments, care must be taken to consider appointments
based on promotions and transfers. Allocation of human
resources should be so planned that available manpower is put
to full use to ensure smooth functioning of all departments.
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Matching Demand and Supply - Steps in Human Resource
Planning; t is one of the objectives of human resource planning
to assess the demand for and supply of human resources and
match both to know shortages and surpluses on both the side in
kind and in number. This will enable the human resource
department to know about overstaffing or understaffing.
The short-range or immediate future - HR Planning Three
Periods; may refer to current situation and experiences and may
even concern issues such as overtime and replacements. If
there has been previous planning for human resource such
plans can serve as a guide in the immediate future. If not, a
beginning should be made at once.
The long-range future - HR Planning Three Periods; could be
five years, while 10 to 15 years span could be used for a
perspective plan. Long-range plans must be made based on
various trends in the economy and in the labor market, and on
long-term trends of production in the company.
The mid-range - HR Planning Three Periods; has a different
time span in various companies. It can be as short as a few
months or if several years. Most would agree upon a 2–3-year
period as a mid-range.
HR Information System - system that maintains, collect, and
analyzes data relating to human resources of the organization.
HRIS includes the information relating to employees, their
abilities, qualifications, potentialities, creative instincts, age, pay
scales, various jobs in the
organization, their required skills, and qualifications to do them,
the number of employees and executives manning various
positions, organizational objectives, policies, and procedures,
etc.
Recruitment - Means search of the prospective employee to
suit the job requirements as
represented by job specification- a technique of job analysis. It
is the first stage in selection, which makes the vacancies known
to many people and the opportunities that the organization
offers. In response to this knowledge, potential applicants would
write to the organization. The process of attracting people to
apply in called recruitment.
Internal Sources - Sources of Recruitment; Refers to the
recruitment from within the company. The various internal
sources are promotion, transfer, past employees, and internal
advertisements.
External Sources - Sources of Recruitment; Refers to the
practice of getting suitable persons from outside.
Casual Caller or Unsolicited Applications - external sources
of recruitment; Can be claimed when the organizations, which
are regarded as good employers, draw a steady stream of
unsolicited applications in their offices
 Media Advertisement - external sources of recruitment; When
advertisement in newspapers or trade and professional journals
is generally used when qualified and experienced personnel are
not available from other sources
Employment Agencies - external sources of recruitment;
Employment exchanges run by the Government are regarded
as a good source of recruitment for unskilled, semi-skilled and
skilled operative jobs.
Management Consultants - external sources of recruitment;
They maintain a data bank of persons with different
qualifications and skills and even advertise the jobs on behalf
their clients to recruit the right type of personnel.
Educational Institutions or Campus Recruitment - external
sources of recruitment; Big organizations maintain a close
liaison with the universities, vocational institutes, and
management institutes for recruitment to various jobs
Recommendation - external sources of recruitment; Applicants
introduced by friends and relatives may prove to be a good
source of recruitment.
Labor Contractors - external sources of recruitment; Workers
are recruited through labor contractors who are they employees
of the organization
Telecasting - external sources of recruitment; The detailed
requirements of the job and the qualities required to do it are
publicized along with the profile of the organization where
vacancy exists. The use of T.V. as a source of recruitment is
less as compared to other sources.
Qualified Personnel - Merit of External Sources; By using
external sources of recruitment the management can make
qualified and trained people to apply for vacant Jobs in the
organization.
Wider Choices - Merit of External Sources; When vacancies
are advertised widely many applicants from outside the
organization apply. The management has a wider choice while
selecting the people for employment.
Fresh Talent - Merit of External Sources; The insiders may
have limited talents. External sources facilitate infusion of fresh
blood with new ideas into the enterprise. This will improve the
overall working of the enterprise.
Competitive Spirit - Merit of External Sources; If a company
can tap external sources, the existing staff will have to compete
with the outsiders. They will work harder to show better
performance
Dissatisfaction among Existing Staff - Demerits of External
Sources; External recruitment may lead to dissatisfaction and
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frustration among existing employees. They may feel that their
chances of promotion are reduced.
Lengthy Process - Demerits of External Sources; Recruitment
from outside takes a long time. The business must notify the
vacancies and wait for applications to initiate the selection
process.
Costly Process - Demerits of External Sources; It is very costly
to recruit staff from external sources. A lot of money must be
spent on advertisement and processing of applications.
Uncertain Response - Demerits of External Sources; The
candidates from outside may not be suitable for the enterprise.
There is no guarantee that the enterprise will be able to attract
right kinds of people from external sources.
Interview - Is an oral examination of candidates for
employment. No selection process is complete without one or
more interviews. Interview is the most common and core method
of both obtaining information from jobseekers, and decision-
making on their suitability or otherwise.
Background Investigation - may include
verification of reference from past teachers, employers, or public
men; public men; police verification; and medical examination
Screening - Is the process of choosing a qualified person for
specific role who can successfully deliver valuable contributions
to the organization.
Multistage Selection Strategy - Screening Strategies for HR;
This combines several assessment tools as part of the process.
The human resources department is responsible for validating
each assessment tool and ensuring that it is legitimately related
to the requirements of the open position. This strategy is paired
with either a conjunctive or compensatory strategy
Compensatory Selection Strategy - Screening Strategies for
HR; This method administers all assessment tools to applicants
at the same time, or at least all of them are administered before
a candidate is eliminated or selected.
Human Resources Development (HRD) -
Focuses on both training employees for their current jobs and
developing skills for their future roles and responsibilities. HRD
activities include training for managers, supervisors, and teams;
tuition reimbursement programs; customer service training;
performance management; harassment prevention training;
360-degree reviews (multi-rater feedback
system); career coaching.
Employee Development - Is a key contributor to a company's
competitive advantage by helping employees understand their
strength, weaknesses, and interests and by showing them how
new jobs and expanded job responsibilities are available to them
 to meet their personal growth needs. This helps retain valuable
managers who might otherwise leave to join clients or
competitors. It is also important for all employees, not just
managers.
Development - Refers to formal education, job experiences,
relationships, and assessment of
personality and abilities that help employees prepare for the
future.
Increasing Productivity: - NEED FOR AND IMPORTANCE OF
TRAINING; Instruction can help employees increase their level
of performance on their present job assignment.
Improving Quality - NEED FOR AND IMPORTANCE OF
TRAINING; Better-informed workers are less likely to make
operational mistakes. Quality increases may be in relationship
to a company product or service, or in reference to the intangible
organizational employment atmosphere.
Helping a Company Fulfill its Future Personnel Needs -
NEED FOR AND IMPORTANCE OF TRAINING; Organizations
that have a good internal educational programmed will have to
make less drastic manpower changes and adjustments in the
event of sudden personnel alternations.
Improving Organizational Climate - NEED FOR AND
IMPORTANCE OF TRAINING; An endless chain of positive
reactions results from a well-planned training programmed.
Production and product quality may improve; financial
incentives may then be increased, internal promotions become
stressed, less supervisory pressures ensue and base pay rate
increases result.
Improving Health and Safety - NEED FOR AND
IMPORTANCE OF TRAINING; Proper training can help prevent
industrial accidents. A safer work
environment leads, to more stable mental attitudes on the part
of employees. Managerial mental state would also improve if
supervisors now that they can better themselves through
company-designed development programs.
Obsolescence Prevention - NEED FOR AND IMPORTANCE
OF TRAINING; Training and development programmed foster
the initiative and creativity of employees and help to prevent
manpower obsolescence, which may be due to age,
temperament or motivation, or the inability of a person to adapt
him to technological changes.
Personal Growth - NEED FOR AND IMPORTANCE OF
TRAINING; Employees on a personal basis gain individually
from their exposure to educational experiences. Again,
Management development programs seem to give participants
a wider awareness, an enlarged skin, an enlightened altruistic
philosophy, and make enhanced personal growth possible.
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On-The-Job Training Methods - This type of training is
imparted on the job and at the workplace where the employee
is expected to perform his duties. It enables the worker to get
training under the same working conditions and environment
and with the same materials, machines, and equipment's that
he will be using ultimately after completing the training. This
follows the most effective methods of training the operative
personnel and generally used in most of the individual
undertaking.
Job Experience - On-The-Job Training Methods; This is the
oldest method of on-the-job training. Learning by experience
cannot and should not be eliminated as a method of
development, though as a sole approach; it is a wasteful, time
consuming and inefficient. In some cases, this method bas
proved to be very efficient though it should be followed by other
training methods to make it more meaningful.
Coaching - On-The-Job Training Methods; On-the-Job
coaching by the superior is an important and potentially effective
approach is superior. The technique involves direct personnel
instruction and guidance, usually with extensive demonstration.
Job Rotation - On-The-Job Training Methods; The major
objective of job rotation training is the broadening of the
background of trainees in the organization. If a trainee is rotated
periodically from one job to another job, he acquires a general
background. The main advantages are it provides a general
background to the trainee, training takes place in actual
situation, competition can be stimulated among the rotating
trainees, and it stimulates a more cooperative attitude by
exposing a man to other fellow problem and viewpoints.
Special Projects - On-The-Job Training Methods; This is a very
flexible training device. The trainee may be asked to perform
special assignment; thereby he learns the work procedure.
Sometime a task force is created
consisting of several trainees representing different functions in
the organization.
Apprenticeship - On-The-Job Training Methods; Under this
method, the trainee is placed under a qualified supervisor or
instructor for a long period of time depending upon the job and
skill required. Wages paid to the trainee is much less than those
paid to qualified workers. This type of training is suitable in
profession, trades, crafts and technical areas like fitter, turner,
electrician, welders, carpenters etc.
Vestibule Training - On-The-Job Training Methods; Under this
method, actual work conditions are created in a classroom or a
workshop. The machines, materials and tools under this method
is same as those used in actual performance in the factory. This
method gives more importance to learning process rather than
production.
 Multiple Management - Emphasizes the use of committees to
increase the flow of ideas from less experience managers and
to train them for positions of greater responsibility. The
McCormick & Company of Baltimore, U.S.A. developed the
program. The company claims that the plan has increased
employee efficiency, reduced labor turnover and absenteeism,
and enabled the company to pay higher wages than those
prevailing in the area and industry. In this method, a junior board
authorized to discuss any problem that the senior board may
discuss, and its members are encouraged to put their mind to
work on the business a whole, rather than to concentrate to their
specialized areas.
Compensation Plan (CP) - Under RA No. 6758 is an orderly
scheme for determining rates of compensation of government
personnel. It was crafted to attract, motivate, and retain good
and qualified people to accomplish the Philippine Government's
mission, and mandates to encourage personal and career
growth, and to reward good performance and length of service.
Compensation Plan Components - Basic Pay / Salaries,
Fringe Benefits, Incentives, Non-financial Rewards
Compensation Administration - Is a segment of management
or human resource management focusing on planning,
organizing, and controlling the direct and indirect payments
employees receive for the work they perform.
Base Pay - Basic Components of Compensation Program;
Refers to the cash that an employer pays for the work performed
Wage and Salary Add-ons - Basic Components of
Compensation Program; Include cost-of-living adjustments
(COLAs), overtime, holiday and other premium wages, travel
and apparel/ clothing allowances, and a host of related forms of
premiums and reimbursements. Wage and salary add-ons are
used to compensate employees for work above and beyond
their normal work schedules or to reimburse them for expenses
related to their jobs.
Incentive Payments - Basic Components of Compensation
Program; Refer to fund's employees receive for meeting
performance or output goals as well as to seniority and merit
pay. Companies provide these forms of compensation to
influence employee behavior, improve productivity, and reward
employees for their years of service or their strong job
performance.
Wages - are hourly rates of pay regulated by the Labor
Standards of the Department of Labor and Employment together
with the National Wages and Productivity Committee
(NWPC).
Salaries - which are usually paid to managers and
professionals, are annual or monthly calculations of pay that
usually have less relation to hours worked.
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Benefits and Services - Basic Components of Compensation
Program; Include paid time off, health insurance, deferred
income such as pension and profit-sharing programs, company
cars, fitness club memberships, childcare services, and tuition
reimbursement.
Social Security Workers' Compensation Unemployment
Compensation - Three Legally required benefits
Defined-benefit plans - the employer promises a fixed pension
level, either in terms of a dollar amount or a percentage of
earnings scaled to seniority.
Defined-contribution plans - specify the amount an employer
will set aside in an investment fund for the benefit of each
employee.
Factors Affecting Wage and Salary Administration; Demand
and Supply of labor and its availability will have a great
influence on the determination of wages rates. If there is a
shortage of labor, the wages demanded will be high. If, on the
other hand labor is plentiful, workers will be too willing to work
at low rates of wages.
Organization's Ability to Pay - Factors Affecting Wage and
Salary Administration; This is a major affecting factor in
determining wage and salary structure of an organization.
Financial position and soundness of an organization can put it
in a position to offer attractive compensation package.
Generally, wages in most of the organization decide through
collective bargaining and organization's ability and capacity to
pay attractive wages depends upon over all financial soundness
and economic condition of an organization.
Organization's Ability to Pay - Factors Affecting Wage and
Salary Administration; This is a major affecting factor in
determining wage and salary structure of an organization.
Financial position and soundness of an organization can put it
in a position to offer attractive compensation package.
Generally, wages in most of the organization decide through
collective bargaining and organization's ability and capacity to
pay attractive wages depends upon over all financial soundness
and economic condition of an organization.
Prevailing Market Rate or "Going Wage Rate" - Factors
Affecting Wage and Salary Administration; This is practically the
major factor that induces any organization to take it as a base
while determining wage and salary structure for it. Prevailing
market rate is also known as 'most comparable rate of wage',
and most popular method for wage rate determination,
especially for lower cadre positions.
Productivity - Factors Affecting Wage and Salary
Administration; it is measured in terms of output per man hour.
It is a result of several
 factors such as technology, labor efforts, method of doing work,
management contribution and support and so on. Productivity
has always remained as base for wage differences since it is a
base which is apparently justifiable and acceptable to all in the
organization.
Cost of Living - Factors Affecting Wage and Salary
Administration; t is always expected that there must be
adjustment in pay rates in accordance with prevailing cost of
living. The changes in the cost-of-living affect purchasing power
of the person. Trade union also considers this as a base for
collective bargaining on wage issues.
Trade Union's Bargaining Power - Factors Affecting Wage
and Salary Administration; Generally, the mechanism for fixing
of wages for majority of worker is collective bargaining or
negotiation, and collective bargaining and negotiations depends
upon the trade union's strength, it may dictate its terms on wage
fixation and revision over a period of
time and vice versa.
Job Requirements - Factors Affecting Wage and Salary
Administration; From the organizational perspective appropriate
job analysis and job evaluation exercise is a base for the wage
determination and revision. It is obvious also that wages to be
paid to the workers should be in accordance with the duties,
responsibilities, and the efforts likely to be put for job
performance.
Management Attitude - Factors Affecting Wage and Salary
Administration; Attitude of employer or management towers the
working community of the organization does influence in wage
determination and revision at an appropriate time. Some
reputed and professional organization does prefer to pay wage
in accordance with their reputation or prestige of an organization
in the market.
Legislative Considerations - Factors Affecting Wage and
Salary Administration; it does provide protection to the working
community by fixing bottom line for wage payments. The state
legislative framework regulates wages and provides for certain
benefits to the workers. Legislation like Minimum Wages Act
of 1936 provides for statutory minimum wages to be prevails in
the industrial organization.
Psychological and Social Factors - Factors Affecting Wage
and Salary Administration; Psychologically person perceives
wages and compensation package as sole parameter for
success or failure in the life. Compensation package plays
significant role in the employees' pride, moral, motivation and
psychological engagement and involvement in the work.
Socially and ethically also people feel that "equal work should
carry equal pay" i.e., wage should be in accordance with efforts
and workers should not be felt like being cheated.
Methods of Wage Payments
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1. Time rate wage system; and
2. Piece rate wage system.
Wage plan should contain following ingredients:
1. It should be simple and understandable
2. It should be capable of easy computation
3. It should be capable of motivating the employees
4. It should be attractive enough for new talent in the
organization.
5. It should be fair, just, and stable to all the employees.
The Labor Code of the Philippines - otherwise known as
Presidential Decree No. 442, governs all employee-employer
relations, their rights, and obligations. Payroll Salary
Compensation and Benefits in the Philippines as provided under
the Labor Code of the Philippines and other relevant laws.
Payroll Salary Compensation, Benefits, Wage and Wage-
Related Benefits Overview
- At least the minimum wage per region and/or sector (RA 6727
or Wage Rationalization Act).
- Holiday wage and overtime pay for work during holidays or rest
days
- Overtime pay when working more than 8 hours
- Service Incentive Leave: 5 days of vacation per year of service
- Parental leaves (Maternity, Paternity and Solo parent leaves)
- Other Leaves
- 13-th month pay
- Separation pays
Performance appraisal - Is the systematic evaluation of the
individual with respect to his performance on the job and his
potential for development. Performance appraised is concerned
with determining the differences among the employees working
in the organization.
Establishing Performance Standard - Steps in Appraising
Performance; While designing a job and formulating a job
description, performance standards are usually developed for
the position. This standard should be very clear and not vague,
and objective enough to be understood and measured. This
standard should be discussed with the supervisors to find out
which different factors are to be incorporated. Weights and
points to be given to each factor and these then should be
indicated on the Appraisal Form, and later used for appraising
the performance of the employees.
Communicating Performance Expectations to Employees -
Steps in Appraising Performance; Their jobs and jobs-related
behavior should be clearly explained to them. It should be noted
that job related behaviors are those critical behavior that
constitute job success. The employee should not be presumed
to guess what is expected of him. It should be noted that here
communication means that the standards have been
transmitted to the employee and he has received and
understood them a two-way communication, i.e., transference
 of information from the manager to the subordinate regarding
expectations, and feedback from the subordinate to the
manager that this information has been received and
understood in same context and contents.
Measuring Actual Performance - Steps in Appraising
Performance; to determine what actual performance is, it is
necessary to acquire information about it we should be
concerned with how we measure and what we measure. Four
sources of information are frequently used to measure actual
performance: personal observation, statistical reports, oral
reports and written
reports.
Comparing Actual Performance with Standards - Steps in
Appraising Performance; By doing so the potentiality for growth
and advancement of an employee can be appraised and judged.
Efforts are made to find out deviations between standard
performance and actual performance.
Discussing the Appraisal with the Employee - Steps in
Appraising Performance; Under these discussion good points,
weak points, and difficulties are indicated and discussed so that
performance is improved. The information that the subordinate
receives about his performance assessment has a great impact
of his self-esteem and on his subsequent performance.
Conveying good news is considerably less difficult for both the
manager and the subordinate than when performance has been
below expectations.
Initiating Corrective Action - Steps in Appraising
Performance; Immediate corrective action can be of two types.
One is immediate and deals predominantly with symptoms. The
other is basic and delves into causes. Immediate corrective
action is often described as putting out fires whereas basic
corrective action gets to the source of deviation and seeks to
adjust the difference permanently. Coaching and counseling
may be done, or special assignments and projects may be set.
Persons may be deputed for formal training courses, and
decision-making responsibilities and authority may be delegated
to the subordinates. Attempts may also be made to recommend
for salary increases or promotions if these decisions become
plausible in the light of appraisals. It should be noted that the
above details may vary from organization to organization, but
these steps usually form the principal steps/features of a sound
evaluation program.
Ranking Method - Traditional Methods of Performance
Appraisal: it is the oldest and simplest method of rating. Here,
each employee is compared with all others performing the same
job and then he is given a particular rank
i.e., First Rank, Second Rank etc.
Grading Method - Traditional Methods of Performance
Appraisal: Under this method of performance appraisal, different
grades are developed for evaluating the ability of different
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employees and then the employees are placed in these grades.
These grades may be as follows: (i)Excellent; (ii) very good; (iii)
Good; (iv) Average; (v) Bad; (vi)Worst.
Manning Comparison Method - Traditional Methods of
Performance Appraisal; This method was first used in USA army
during the 1st World War. Under this method, few factors are
selected for analysis purposes. These factors are leadership,
dependability, and initiative. After that, a scale is designed by
the rate for each factor. A scale of person is also developed for
each selected factor. Each person to be rated is compared with
the person in the scale, and certain scores for each factor are
awarded to him/her. In other words, instead of comparing a
whole man to a whole man personnel are compared to the key
man in respect of one factor at a time. We can use this method
in job evaluation. This method is also known as the Factor
Comparison Method. In performance appraisal, it is not of much
use because the designing of scale is a very difficult task.
Graphic Rating Scale Method of Performance Appraisal -
Traditional Methods of Performance Appraisal: This is the very
popular, traditional method of performance appraisal. Under this
method, scales are established for several specific factors. A
printed form is supplied to the rater. The form contains several
factors to be rated. Employee characteristics and contributions
include qualities like quality of work, dependability, creative
ability and so on. These traits are then evaluated on a
continuous scale, where the rater places a mark somewhere
along the scale. The scores are tabulated and a comparison of
scores among the different individuals is made. These scores
indicate the work of every individual.
Human Asset Accounting Method - Modern Method of
Appraisal and Career Development; This technique refers to
money estimates to the value of a firms’ internal human
organization and its external customer goodwill. If well-trained
employees leave a firm, the human organization is worthless; if
they join it, its human assets are increased. if distrust and
conflict prevail, the human enterprise is devalued. If teamwork
and high morale prevail, the human organization is a very
valuable asset.
Behaviorally Anchored Rating Scales (BARS) - Modern
Method of Appraisal and Career Development; This method is
also called behavioral expectation scales. These are the rating
scales whose scale points are determined by statements of
effective and ineffective behavior. They are said to be
behaviorally anchored in that the scales represent a range of
descriptive statements of behavior varying from the least to the
most effective. A rater must indicate which behavior on each
scale best described an employee performance.
Management by Objective (MBO) - Modern Method of
Appraisal and Career Development; It was Peter F. Drucker who
first gave the concept of MBO to the world in 1954 when his
book The Practice of Management was first published.
 Management by objective can be described as, a process
whereby the superior and subordinate managers of an
organization jointly identify its common goals, define everyone’s
major areas of responsibility in terms of results expected of him
and use these measures as guides for operating the unit and
assessing the contribution of each of its members.
Time Consuming - Limitations of Performance Appraisal;
Performance appraisal is a time taking affair. It is a very lengthy
process under which different forms are to be filled in and
various observations are required to be noted in a careful
manner.
Lack of Reliability - Limitations of Performance Appraisal;
Reliability implies stability and consistency in the measurement.
Lack of consistency over time and among different raters may
reduce the reliability of performance appraisal.
Incompetence - Limitations of Performance Appraisal; Raters
may fail to evaluate performance accurately due to lack of
knowledge and experience. Post appraisal interview is often
handled ineffectively.
No Uniform Standards - Limitations of Performance Appraisal;
The standards used for appraisal purpose are not uniform within
the same organization. This makes the rating unscientific.
Similarly, the rating is done based on an overall impression,
which is not proper.
Absence of Effective Participation of Employees -
Limitations of Performance Appraisal; In performance appraisal
effective participation of concerned employee is essential. In
many methods of appraisal, he is given a passive role. He is
evaluated but his participation or self-evaluation is rather
absent.
Stereotyping - Limitations of Performance Appraisal; This
implies forming a mental picture of a person based on his age,
sex, caste, or religion. It results in an over-simplified view and
blurs the assessment of job performance.
Negative Approach - Limitations of Performance Appraisal;
Performance appraisal loses most of its value when the focus of
management is on punishment rather than on development of
employees.
Individual Differences - Limitations of Performance Appraisal;
Some people are more distinct while some are very liberal in
assigning the factors, points, or number to the employees. They
are unable to maintain a fair distinction between two individuals.
It also nullifies the utility.
Job Analysis - Is a systematic study of how a job discovers its
specifications, skill requirements, etc. for wage-setting,
recruitment, training, or job simplification purposes.
Job Description - It is a list of job's duties responsibilities,
reporting relationships, working conditions, and supervisory
responsibilities.
Job Specification - It is a list of human requirements that is the
requisite education, skills, personality, and so on and another
product of a job analysis.
Work Activities - types of information via the job analysis; The
specialist collects information about the job's actual work
activities, example: cleaning, selling, teaching and may also
include the how, why, and when the worker performs each
activity.

Resistance of Employees to Appraisal - Limitations of

Performance Appraisal; Employees oppose the system as they
feel that the system is only for showing their defects and for
punishing them. The managers resist the system as they are not
willing to criticize their subordinates or have no capacity to guide
them for self-improvement or self-development.

Paperwork - Limitations of Performance Appraisal; Some

supervisors feel that performance appraisal is paperwork. They
make such complaints because many a times, performance
appraisal reports are found only in the files rather than rendering
any practical use.

Fear of Spoiling Relations - Limitations of Performance

Appraisal; Performance appraisals may also affect superior-
subordinate relations. As appraisal makes the superior more of
a judge rather than a coach, the subordinate may look upon the
superior with a feeling of a suspicion and mistrust.

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