Compensation and Wag

es
Prepared by: Omelhana B. Guro
Haniefa A. Sumarino
Solomon Faustine Ricaforte
 Compensation
Is any tangiable equivalent or reveal for services rendered
or for the performance of a task performed in the
organization.
Two types of Compensation
-is monetary in nature and given in the form
Direct compensation of salaries,wages,commissions,bonuses, and
allowances.

-is given in the form of services and non-

monetary benefits such us hospitalization,
Indirect compensation summer outings,vacation leaves, and
sportsfests.
Compensation Guidelines
 Are influenced by the nature and environment of a p
articular industry.

 THE MINIMUM WAGE LAW is set to protect manual laborers

from being taken advantage of by companies.

 SALARY refers to compensation given to professionals on a

monthly or semi-monthly basis.

 WAGE refers to compensation given on a weekly or daily b

asis and usually applies to manual workers.

 BASE PAY OR BASIC PAY is he fixed part of the pay. It is the

minimum payment for the tasks rendered by the employee
based on his or her positon or job title.
Common Modes Of Payment
 1.Payment for time worked

Majority of employees are paid on the basis of time

worked.

MONTHLY-PAID EMPLOYEES are those who are paid each

day of a particular month including unworked rest days,special
days, and regular holidays.

DAILY PAID EMPLOYEES are paid on the basis of the days

they actually worked and unworked regular holidays.
a.Across-the-board - pay adjustments provided to all employees with
increase the same rate regardless of rank.

– salary or wage increase given to employees on the

b.Merit increase basis performance.

– monetary allowance given to employees to help

c.Cost-of-living them cope with the prevailing conditions of the
allowance(COLA) economy related to the standard of living and
increasing prices of commodities due to the inflation.

– this is give to employees based on the

d.Seniority pay number of years of service in the company.
2.Flat rates

 Firms with flats do not consider skills and seniority as factors for giving
compensation.
 3.Compensation through incentives
These are payment based on output.The most popular forms of incentive pay are the following:

This is given in recognition of outstanding

a.Meritpay performance and based on the results of a
performance evaluation.

Piece rate This is given to employees who are paid a fixed

pay rate per product produced.

This is compensation based on an achieved sales

Commission quota.

This is given to a team that has achieved a particular

Group
Group sales or production target.
incentives
incentives
 4.Payment based on skills

This is based on the number of skills the employees gain while wor
king for the company.

5.Payment based on knowledge or

credentials

Continous learning is one of the motivations for an employee to attend

seminars and conferences related to his or her field of expertise .
6.Executive payment

This is payment given to chief executive officers,the chairman of

the board ,and other members of top management.

7.Special payment

This
This is
is additional
additional compensation
compensation given
given in
in special
special cases.
cases. It
It includes
includes
the
the following:
following:
 a.Overtime pay b.Holidays pay
This covers work done beyond the
This is payment for an unworked
normal schedule of eight hours a day,
regular holiday based on the
and is given on top of the basic
employee’s daily rate.
salary.

c.Premium pay d.Night differential payment

This is payment given to employees This is an additional 10% of basic
who work during rest days and special rate for each hour of work performed
days. between 10:00pm to 6:00am.
 e. Service charge This refers to fees charged to cover services related to the
production of a product or provision of service.

f.Severance or separation pay It is the duty of the firm to provide

separation pay to employees who are terminated with authorize cause.

g.Retirement pay An employees who is 60 or 65 years old shall

receive one-halfmonth salary for every year of service provided that he or
she rendered five years of continuous service to the company.

h. Thirteenth month pay All employees are entitled to thirteenth

month pay providedthat they have worked for atleast one month in a
calendar year.
Thank you