Professional Documents
Culture Documents
REWARD MANAGEMENT
Remuneration & Rewards
Financial Non-Financial
Total
Compensation
Market
Organisation
Forces
Policy
Work Individual
Value Performance
Three Pay Policies
Lead + + ? ?
Match = = ? =
Lag - ? ? +
Govt. regulation of Compensation in
India
• Minimum Wages Act, 1948
• Payment of Wages Act, 1936
• Adjudication of Wage Disputes
• Wage boards
• Pay Commissions
• Payment of Bonus Act, 1965
The Compensation Structure
Job Evaluation
Rate Ranges
Step 1 Job Evaluation
The systematic process of
determining the relative worth of jobs
in order to establish which jobs should
be paid more than others within an
organization.
Establishing a Salary Structure
Step 3
• Group jobs into Pay Grades or Job
Classes
• Groups of jobs within a particular
class that are paid the same rate or
rate range
– jobs of equal difficulty
TECHNIQUES OF JOB
EVALUATION
NON-QUANTITATIVE
• Ranking
• Job Classification Or Job Grading
QUANTITATIVE
• Point Rating Method
• Factor Comparison
• Decision Band
Hierarchy of Clerical Jobs, JE Points and
Pay Grades for a Hypothetical Office
6
monthly
salary 5
(Rs.000) 4
PAY 3
Line of Best Fit :
2 using Market-Survey data
or current organization
1
data
29.50
27.00
24.50
22.00
22.00
19.50
Minimum Rate
17.00
14.50
12.00
I II III IV V VI
9.50
0 50 100 150 200 250 300
Red & Green Circle Jobs
39.50
37.00
34.50
32.00
Rates (Rs. 000)
29.50
27.00
24.50
22.00
22.00
19.50
17.00
14.50
12.00
I II III IV V VI
9.50
0 50 100 150 200 250 300
What Is Competency-based Pay?
• Competency-based pay
– Where the company pays for the
employee’s range, depth, and types of
skills and knowledge, rather than for the
job title he or she holds.
• Competencies
– Demonstrable characteristics of a
person, including knowledge, skills, and
behaviors, that enable performance.
Concept of Different Wages
• MINIMUM WAGE
• FAIR WAGE
• LIVING WAGE (HIGHEST IN
VALUE)
BASIC WAGE PLANS
• TIME WAGE PLAN
• PIECE WAGE PLAN
• SKILL BASED PAY
• COMPETENCY BASED PAY
• BROADBANDING
Other Compensation Trends
• Broadbanding
– Consolidating salary grades and ranges
into just a few wide levels or “bands,”
each of which contains a relatively wide
range of jobs and salary levels.
• Wide bands provide for more flexibility in
assigning workers to different job grades.
• Lack of permanence in job responsibilities
can be unsettling to new employees.
Broadbanding
39.50 Wage Curve (or line)
Maximum Rate
37.00
34.50
Previous
32.00
Rates (Rs. 000)
Maximum Rate
29.50
27.00
24.50
22.00
Minimum Rate
22.00
19.50
17.00 Previous
Minimum Rate
14.50
12.00
I II III IV V VI
9.50
0 50 100 150 200 250 300
VARIABLE PAY