MAINTENANCE

AND
REWARDING OF
EMPLOYEES
 01 02
Components of
Compensation
Compensation
• Concept of Compensation • Base Pay
• Objectives of Compensation • Premium Pay
TABLE OF • Compensation Policy •
•
Base Pay Progression
Variable Pay
CONTENTS
03
Wages VS
04
Determining
Salaries Pay Rates
• Differentiation between • Internal Equity
salaries and wages • External Equity
 05
Establishing
06
Jobs Evaluation
Pay Rates Method
• Salary Survey • To be reported by Sir
• Job Evaluation Hubert Keith Vega
TABLE OF
CONTENTS
07
Assigning 08
Assigning
Weights to Points to
Factors Specific Jobs
• To be reported by Sir • To be reported by Sir
Hubert Keith Vega Hubert Keith Vega
 10
Forms of
Compensation
• To be reported by Sir Hubert
Keith Vega
TABLE OF
CONTENTS
 What was the main
reason for your
decision to either
accept or reject a job
offer?
01
COMPENSATION
set of rewards that the organizations provide to
individual in return for their willingness to
perform various jobs and tasks within the
organization
• all forms of financial returns and tangible
services and benefits employees receive as
part of an employment relationship

• various elements such as base salary,

incentives, bonuses, benefits, and other
rewards
 ✓establish a structure for the
PRIMARY equitable compensation of
employees, depending on their jobs
OBJECTIVE and their level of performance in
their jobs
OF
IF effective:
COMPENSATION 1. Improve cost efficiency
2. Ensure legal compliance
3. Enhance recruitment efforts
4. Reduce morale
5. Turnover problems
 COMPENSATION POLICY
Compensation should be:

ADEQUATE EQUITABLE
meet the needs of the employees each person should be paid fairly,
and to acquire and retain qualified in line with his/her efforts, abilities,
personnel. and training.

BALANCED COST-EFFECTIVE
Pay benefits and other rewards
the company’s ability to pay
should provide a reasonable total
reward package
 COMPENSATION POLICY
Compensation should be:

INCENTIVE-
SECURE PROVIDING
Pay should be enough to help an Pay should motivate effective
employee feel secure and aid band productive work or reward
him/her in satisfying basic needs desired behavior

ACCEPTABLE TO COMPLIANT
THE EMPLOYEES WITH LEGAL
the employee should understand REGULATION
the pay system being followed by
the company and should feel it is
reasonable for the organization
and for him/her.
02
COMPONENTS
OF
COMPENSATION
Direct compensation consists of cash
directly paid to the employee in
exchange for his/her work
 Private:
As per DOLE RTWPB RO VIII
WAGE ORDER NO. RB VIII-2
BASE PAY New minimum wage starting
January 2, 2023: P345-375.00

Public:
The hourly wage or Refer to salary grade table of
weekly/monthly salary earned RA 11466
(Salary Standardization Law of 2019)

PREMIUM
PAY
the additional compensation
required by law for work
performed within eight (8) hours
on nonworking days, such as rest
days and special days
Private:
Refer to Labor Code of the
Philippines and the Handbook on
workers’ statutory monetary benefits
1. Holiday Pay
2. Overtime Pay
3. Night Shift Differential
Public:
Same except on the night shift differential,
refer to RA 11701
(An Act Granting Night Shift Differential Pay
to Government Employees, Including Those
in Government-Owned or -Controlled
Corporations and Appropriating Funds
Therefor)
 BASE Private:
PAY Company’s Policy

PROGRESSION

Public:
movement of base pay overtime,
RA 11466
from year to year (Salary Standardization Law 2019 First
to Fourth Tranche)

From Step 1 to Step 8

 Private:
VARIABLE 1.
2.
Sales Commissions
Service Charges
PAY 3.
4.
Bonuses
Profit-sharing
5. Performance Pay
6. Options
7. 13th month pay

incentive or bonus pay that does not Public:

fall into base pay; such earnings may 1. PBB
be based on performance against
preset goals (incentives) or pay at the
2. Mid-Year Bonus
discretion of the company 3. Year-End Bonus
(bonuses); may be paid at the 4. Cash Gifts
individual, team, group, or 5. PEI
organizational level
Indirect compensation
- quality of work life
- Total rewards also include a broad array of nonmonetary
rewards that we place under the general umbrella of quality of work life

These rewards include:

A. Organizational B. Intrinsic Values

Structure • rewards inherent in the work itself
• norms and values defining • rewards come from the act of
appropriate behavior in the performing
organization

C. Career Opportunities
• prospects for development
and growth
03
WAGES
VS SALARIES
Fundamental to compensation
understands the distinction between
wages and salaries.
 WAGES
compensation paid to skilled and
unskilled workers or those
performing blue-collar jobs, with
time as the basis in the computation.
SALARIES
income paid to an individual not
on the basis of time but on the
basis of performance.
usually given to professional and
managerial employees or those who
are performing white-collar jobs
04
DETERMINING
PAY
RATES
Most wage and salary systems establish pay ranges for certain
jobs based on the relative worth of the job to the organization.

An employee’s performance on the same job should then

determine where that employee’s pay falls within the job’s
range.

The key is the establishment of different pay ranges for the

various jobs within the organization. A pay range for a given job
establishes a range of permissible pay, with a minimum and a
maximum
Establishing pay ranges involves two basic phases:

INTERNAL EXTERNAL
EQUITY EQUITY
Determining the relative worth of Pricing the different jobs
the different jobs to the
organization
Wage survey represent one of the
Job evaluation is the primary method most commonly used methods for
used to determine the relative worth of pricing jobs.
jobs to the organization.
04
ESTABLISHING
PAY
RATES
1. Conduct the salary survey 2. Determining the worth of
(aimed at determining each job through job
prevailing wage rates) evaluation

a. Price benchmark jobs

b. Majority of the positions found in the company

are usually priced directly in the marketplace.

c. To collect data on benefits so as to provide a

basis on which to make decisions regarding
employee benefits
THANK
YOU!