COMPENSATION AND ADMINITRATION PAYROLL

 Process of paying the company’s employees which

WEEK 1 includes tracking hours worked, calculating
COMPENSATION employees pay and distributing payments via direct
-Refers all forms of financial return and tangible services deposit to an employee bank account.
and benefits employees receive as part of employment
relationship BENEFITS
-Generally one of the largest costs or expenses for any  It is non-monetary value and are not based on
organization (We need to compensate individually) performance but on membership. They are indirect
-Employee receives in exchange for the service they forms of compensation and are paid regardless of
provide to their employer (cash, vacation, etc.) the performance. They can determine their benefits
- It can help recruitment job performance and job package to be availed.
satisfaction. A tool used by management for a variety of
purposes to further the existence of the business. NOTES:
-Compensation may be used in retaining and recruiting *Salaries for those working in cities are higher than for
qualified employees those who work in provinces
* Salaries and wages vary depending on nature of work,
COMPENSATION ADMINISTRATION location of work and time of work.
-It is the task of an operations manager to design and
implementing a pay program with a systematic MANDATED BENEFITS
approach to providing monetary value to employees in -Overtime pay -Maternity leave
exchange for work performance. -13TH Month pay -PAG-IBIG
Management Employee Compesation is called -VAWC -Paternity leave
Compensation Administration -Health insurance -SSS
-A strategic management tool of compensation -Parental leave for solo parent
management and HR management to maintain
productivity with the cost of labor and employees to get Compensation Includes:
the satisfaction of their worth and values. COMMISSIONS- a sum of money given to a salesperson
-The goal is to design a cost-effective structure that will for each transaction
attract, motivate and retain competent employees. BASEPAY- basic compensation what employee gets
OVERTIME PAY- offered to people who need to work
OBJECTIVES: longer
1. To attract and retain competent employees STOCK OPTIONS- benefit in the form of an option given
2. To establish fair and equitable compensation by a company to an employee to buy stock in the
3. To control costs and improve productivity company
4. To comply with legal regulations BONUS- paid above and beyond ones based salary
5. To reward desired behavior PROFIT SHARING- people who work for a company
6. To improve the company’s goodwill in the eyes receives a direct share
of the general public and employees MERIT SHARING- uses to reward
JOB DESCRIPTION- specify the detail about all the
WAGES duties and responsibilities involved in a particular job or
 refers to all pay or earnings position.
 lowest wage rate fixed by law that an employer JOB SPECIFICATION- the list of recommended qualities
can pay to the workers. for a person to qualify for and succeed in a position.
 Per hour or per day JOB ANALYSIS- product of job description and job
specification
SALARY JOB EVALUATION- process of establishing how much
 A regular payment agreed upon in an compensation to allocate to a job.
employment contract, and it's linked to the PAY STRUCTURE- uses for standardizing
number of hours defined in the contract. SALARY SURVEY- compile market and salary data
 A fixed amount that is paid to an employee at
regular intervals, irrespective of the hours or
amount of work performed. PHASES OF COMPENSATION
  Min. wage can also be one element of a policy to
OBTAIN overcome poverty and reduce inequality, including
those between men and women, by promoting the
ADMIN PRODUCTIVITY right renumeration for work and equal value.
COMPENSATION MAINTAIN WORKFORCE

STEPS INVOLVES IN DETERMINING WAGE RATE

RETAIN

ROLE OF COMPENSATION MANAGERS

-Compensation managers are responsible for
researching, establishing, and maintaining a company's
pay system. This involves researching and understanding
the current and upcoming competitive markets for
employee pay and benefits.

GOVERNMENT AGENCIES RESPONSIBLE FOR

COMPENSATION AND BENEFITS
-DOLE -TESDA
-NWPC -ECC
-RTWPB -BIR
TYPES OF WAGES
-NLRC -SSS
1. PIECE WAGE- wages paid according to the work
done by the worker. (*rate paid unit of production,
CHALLENGES OF HR IN *number of units completed in the pay period)
2. TIME WAGES- if the worker is paid for his service
 Budget constraints
according to the time
 Market competitiveness
3. CASH WAGE- wages paid to the labor in terms of
 Pay Equity money. The salary too a worker in an example of
 Regulatory compliance cash wages.
 Performance measurement 4. LIVING WAGE- the least amount of money an
 Balancing intrinsic and extrinsic rewards employer can offer to an employee
 Communication and transparency 5. MINIMUM WAGE- least amount that can receive
 Retention and turnover
 Adapting to change CONCEPT OF WAGES
 Implementing technology  Money wages or Nominal wages refers to the
total amount by the laborer in the process of
production.
 Real wages the type of wages that take inflation
WEEK 2 rates into consideration. This wage determine
WAGES AND ITS SIGNIFICANCE the purchase power of the individual and the
amount of goods or services in the individual
WAGES- price paid for the services of labor in the can purchase given the current market
process of production and includes only the conditions. (Saan aabot ang wage mo?)
performance wages proper.  Real wage computation: Nominal wage /
consumer price index * 100
PURPOSE OF WAGES

 Min. wage is to protect the workers against unduly

low pay. They help ensure unjust and equitable share
of the fruits of progress to all and a minimum living
wage to all who are employees and in need of such WAGE SYSTEM
protection
-refers to the compensation to an employees with a RELATION OF LABOR COST TO TOTAL COST
fixed sum per piece, hour, day or another period of time
covering all the compensations including salary. COMPENSATION
-should by the instruction of fair wage UNIT LABOR COST= OUTPUT
-(R.A. 6727) Tier 1- complaint with wage min.
Tier 2- productivity based scheme COST OF LABOR- sum of all wages paid to employees.

CHARACTERISTICS OF A GOOD WAGE

-Should be fair and scientific
-Guaranteed min. payment
-Should be accepted to reduce turnover
-Should be flexible to adopt changes
-Should be guided by government policy
-Should ensure incentives for good performance
-Should be simple to understand by all workers
-Should be able to satisfy worker to improve
productivity
-Should be discourage individualism

SIGNIFICANCE OF WAGES
*To the worker; the wages are not only the
renumeration of the workers for their contribution in
the production by their very means of livelihood.
*Wage as a purchasing power.
*The level of living depends in the amount of money
when the workers take home.

LEVELS OF LIVING
1. POVERTY LEVEL- this level of income is very
irregular due to their lack of any desired skills
they can offer.
2. MINIMUM SUBSISTENCE LEVEL- these levels
are those workers who provide the basic needs
but do not provide the social needs.
3. MINIMUM HEALTH AND DECENCY- workers
who provide meager(insufficient) provisions for
education, amusement and insurance.
4. MINIMUM OF COMFORT AND STANDARD- an
employee's remuneration is so high that he can
provide for all the basic necessities and meet all
the requirements of comfort for himself.

WAGES AS COST OF PRODUCTION

-Also called production cost or cost price.
-It is the total cost sustained by a business to reduce a
specific quantity od a product. I t involves direct cost of
manufacturing the product.
-It includes of cost of raw materials labor(wages),
storage, technology used, maintenance, land.
-HIGH LABOR COST, THE HIGHER WAGES WOULD MEAN
SELLING THE GOODS AT HIGHER PRICES.