Employee Remuneration

25.01.2011 IRPM Class Ms. Mital Petiwale

Factors Influencing Wage and Salary Structure and Administration

Job description and Job evaluation Organization's ability to pay Supply and demand of labour Prevailing Market rates The cost of living Living wage Productivity ( output per man hour) Trade Unions bargaining power Job Requirements Managerial attitudes Psychological and Sociological factors

Remuneration
Compensation an employee receives in return for his/her contribution to the organization Contributes directly to the cost of production Many factors depends on remuneration e.g. standard of living, status in the society, motivation, loyalty, productivity etc Includes wage and salary, incentives, fringe benefits, perquisites and non monetary benefits

Components of Remuneration
Wage and Salary Incentives (payment by results) Paid in addition to wage and salary Influenced by productivity, profit, sales, cost of reduction efforts Individual incentive scheme( Specific employee performance) Group incentive programme ( divided amongst group members on an equitable basis )

Cont..
Fringe Benefits employee benefits like provident fund, gratuity, medical care, hospitalization, accident relief, health and group insurance, canteen, uniform, recreation etc Perquisites ( retain competent executives) allowed to executives E.g. company car, club membership, paid holiday, furnished house etc Non Monetary Benefits Challenging job responsibilities, recognition of merit, growth prospects, competent supervision, comfortable working conditions, job sharing etc

Financial Remuneration
Direct Remuneration Hourly and Monthly rated wages and salaries Incentives Individual Plans and Group Plans Indirect Remuneration Fringe benefits- PF, Gratuity, Medical Care, Accident Relief, Health and Group Insurance etc Perquisites company car, club membership, paid holidays, furnished house, stock option etc

Non Financial Remuneration

Job Content Challenging job, responsibilities, recognition, growth prospects, supervision, working conditions, job sharing etc