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    Comp N Ben

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    anirudh_rangarajan
    This document discusses compensation and its various components. It defines compensation as remuneration received by employees both monetary and non-monetary. Compensation includes wages, salary, benefits, and services. There are various theories related to compensation including reinforcement, agency, and equity theories. Devising a compensation plan involves job evaluation, benchmarking, and considering internal and external factors. Components of compensation include basic salary, bonuses, allowances, perquisites, and retirement benefits. Various acts also govern compensation in India.

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    Comp N Ben

    Uploaded by

    anirudh_rangarajan
    75 views17 pages
    This document discusses compensation and its various components. It defines compensation as remuneration received by employees both monetary and non-monetary. Compensation includes wages, salary, benefits, and services. There are various theories related to compensation including reinforcement, agency, and equity theories. Devising a compensation plan involves job evaluation, benchmarking, and considering internal and external factors. Components of compensation include basic salary, bonuses, allowances, perquisites, and retirement benefits. Various acts also govern compensation in India.

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    comp n ben

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    comp n ben

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    This document discusses compensation and its various components. It defines compensation as remuneration received by employees both monetary and non-monetary. Compensation includes wages, salary, benefits, and services. There are various theories related to compensation including reinforcement, agency, and equity theories. Devising a compensation plan involves job evaluation, benchmarking, and considering internal and external factors. Components of compensation include basic salary, bonuses, allowances, perquisites, and retirement benefits. Various acts also govern compensation in India.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    75 views17 pages

    Comp N Ben

    Uploaded by

    anirudh_rangarajan
    This document discusses compensation and its various components. It defines compensation as remuneration received by employees both monetary and non-monetary. Compensation includes wages, salary, benefits, and services. There are various theories related to compensation including reinforcement, agency, and equity theories. Devising a compensation plan involves job evaluation, benchmarking, and considering internal and external factors. Components of compensation include basic salary, bonuses, allowances, perquisites, and retirement benefits. Various acts also govern compensation in India.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 17

    Compen$ation

    By:
    Vipul Nangia
    Shashank Jha

    Definitions
    Compensation is the remuneration an employee
    receives for his/her contribution to the organization.
    - Both Monetary and Non-Monetary pay

    Wages and Salary ??

    Theories

    Reinforcement and Expectancy Theory


    Agency Theory
    Equity Theory
    Why Care ???
    Contribution to the cost of
    Production.
    Consequences:
    Job Dissatisfaction
    Absenteeism
    Turnover/Attrition

    Benefits & Services


    Anything that employee receives in addition to direct remuneration
    -> Indirect Compensation
    -> Tax Benefits for both employee and
    employer.

    Benefits : Direct Monetary Value to individual employee can be ascertained e.g.


    Medical insurance, pensions etc.
    Services: Direct money values for an individual employee cant be ascertained
    e.g. Company newspapers , Employee Assistance Programmes etc.

    Not tied to
    Performance but to
    an organization
    membership.
    Hygiene or Motivator??

    Devising a Compensation Plan


    Pay Survey/Salary Survey
    Methods:
    Data Based Survey available data
    from agencies/consultants
    Field Survey questionnaires,
    interviews etc.

    Benchmarking Survey
    Job Evaluation : Process of systematically
    determining the relative worth of jobs to
    create a job structure for the organization. It
    could be job based, skill based or competency
    based

    Identify roles
    Identify Role descriptions
    Identify Comparator Basket
    Identify Roles from comparators to be
    benchmarked
    Choose method of survey

    Hays System of Job Evaluation

    KnowHow

    Technical Skills
    Managerial Skills
    HR skills

    Problem
    Solving

    Environment
    Challenge

    Accountability

    Impact on end
    results
    Scope/Magnitude
    Freedom to Act

    Job Worth

    Factors Influencing Compensation

    : Internal Factors

    Business Goals/Strategy
    Employers Ability to pay
    Company policy pay policies
    ->Seniority or performance
    ->Piece wise rate or merit based

    Job Worth
    Equity
    Commission vs Incentives??
    Business Strategy
    Invest to grow (Merging
    or Growth)

    Protect Markets
    (Maturity)

    Harvest EarningsReinvest elsewhere

    Compensation
    Strategy

    Compensation

    Stimulate
    Entrepreneurship

    High Cash
    Above average
    incentives

    Reward Management
    Skills

    Average Cash
    Moderate incentives

    Cost Control

    Below-average cash
    Small incentives

    External Factors

    Demand & Supply


    Compa Ratio
    Economic conditions
    Working Environment
    Laws
    Collective bargaining

    Increments

    How increments are given ?


    Ratings
    Company Performance
    Team Performance
    Market standing

    Components

    COMPONENTS OF GROSS SALARY


    Basic Salary
    Bonus
    Commission/Incentives
    Allowances
    Perquisites
    Leave Travel Concession In India (LTC )
    Medical Facilities
    Retirement Benefits

    Allowances

    Entertainment allowance
    House Rent Allowance
    Allowances for official purposes
    Travelling Allowance
    Daily Allowance
    Conveyance allowance
    Helper Allowance
    Academic Allowance
    Uniform Allowance
    Allowances for personal
    purposes
    Children Education allowance
    Hostel Expenditure Allowance
    Tribal Area allowance
    Transport Allowance
    Underground allowance

    Other Allowances
    Dearness Allowance
    Lunch Allowance
    City compensatory Allowance
    Servant Allowance
    Medical Allowance etc.

    Perquisite

    Rent free accommodation (RFA)


    Concessional Accommodation
    LIC Policy & Annuity Policy
    Monetary obligation of employee
    Fringe benefits
    Interest free or concessional loans
    Use of Movable Assets
    Transfer of Movable assets
    Travelling, Tour, Accommodation & Other
    Expenses
    Free Meals, Tea & Snacks
    Gift, Vouchers or token

    Retirement Benefits

    Gratuity
    Pension
    Leave salary
    Retrenchment compensation
    Voluntary Retirement
    Provident fund

    Acts

    Payment of wages Act


    Payment of Bonus Act
    PF Act
    Gratuity Act
    Equal Remuneration Act

    Banding

    FIGURE
    Broadbanded
    Structure and
    How It Relates to
    Traditional Pay
    Grades and
    Ranges

    Seniority

    Overlap of Bands

    Band D
    Band C
    Band B
    Band A

    Salary

    Q&A

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