Statutory Provisions Governing Different Components of Reward System

1. Payment of Wages Act, 1936

Ensure regulate & prompt payment of wages & to prevent the exploitation of the wage earner by prohibiting arbitrary fines & deductions from his wages.

It is also stipulates the rate of payment for overtime work & penal deductions for participation in illegal strikes (8 days wages from days participation in illegal strike)

Different institutions related to reward system

Wage Boards & Pay Commission

Wage Boards for regulating compensation in industries belonging to private sector, including

newspaper establishments & working journalists,

while pay commission tend to regulate the

compensation of public sectors.

Different institutions related to reward system

Wage Boards
Statutory & non-statutory in nature. Set up to protect workers from exploitation of

capitalists.

Different institutions related to reward system

Pay Commission
PC is an administrative system that the Govt. of India set up in the year 1956 to determine the salaries of govt. employees. 1st Pay Commission 1947 2nd Pay Commission 1959 3rd Pay Commission 1973 4th Pay Commission 1984 5th Pay Commission 1996 6th Pay Commission 2010 Pay can also cover compensation of employees working in the public sector such as nationalized banks & industrial establishments

Role of trade unions in compensation management

The role of T U in administrating compensation ism outlined primarily in the collective agreement. Points to a change in the attitude and response of trade unions and reflects their willingness to facilitated changes introducing flexibility, promoting productivity and linking wages to performance.
Managerial Rights Substituting Labour with Capital & Technology Wages Greater Flexibility & Productivity Introducing New Norms in the Context of New Method / Technology