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PRESENTED BY:-
RENU GOME
VARNIKA TRIPATHI
SAKSHI BHATIA
 Terminologies
ï Wages- Y
 
 

 







 





  




 
 
 ½


½

 

ï Salary- D    





    

 
 Wages Vs Salary

HEADS WAGES SALARY

Quantum of Can be Cannot be

service measured measured

Service period shorter longer

salary

Payment On actual Uniformly on

production monthly basis
ï Wage rate- Wage received by a worker for a
unit of time or production excludes all other
earnings.
ï Wage scale- 2utting together all properly
evaluated standard wage rates arranged in
sequence according to evaluation of job & size of
rate.
ï Nominal wages- Wage expressed in terms of
money.
ï Real wages- Goods & services which could be
purchased with the help of money wage.
ï åringe benefit- compensation over & above
wages often not related to output, performance or
time worked.
 Objectives of wage & salary
Administration

 Dontrol of costs
 Establishment of fair & equitable
remuneration
 Employee motivation
 Maintenance of a satisfactory public
relation image.
 åunctions of wage & salary
Administration
 o approve system of job description and
evaluation.
 Recommend to top management the policy for
administration of wage programme.
 o recommend changes in wage policies and in
the salary or wage level.
 o review wage and salary department wise.
 o check all activities of the salary
administration against the company policies.
 Norms for fixation of wages
ï While computing the minimum wages, the
standard working class family should be
considered as consisting of four consumption
units.
ï Minimum food requirements should be
determined on grounds of net intake of 2700
calories as laid down for a normal adult in
India.
ï Dlothing needs should be established on basis
of a per capita consumption of 16.62 meters,
per year.
ï As regards housing, minimum wages should be
determined from the standpoint of rent,
corresponding to minimum area specified
under government Industrial Housing Scheme.

ï Miscellaneous expenditure on items such as

fuel, lighting etc. should form 20 % of the total
minimum wage.

ï he resolution further prescribes that the

authorities involved in the issue should justify
any deviation from these norms
 Principles of wage & salary
determination

ï 2reserving Real Income: his is the argument

used by employees and unions viewing wages as an
income.Following this principle usually results in
wages being indexed to inflation.

ï Labour 2roductivity: A valid economic theory

connects wages to labour productivity.
Donflict however sometimes arises over the
measurement of productivity.
 Principles of wage & salary
determination
ï Dapacity of Business o Afford Wage
Increases: he capacity argument is that followed by
business owners. his emphasizes wages as a cost of
production and a threat of wages to squeeze profits.

ï Supply & Demand of Labour: Supply & demand

forces operated at national, regional and local levels
determine an organizational wage structure.
If the supply of certain skills is less than its demand,
the result is a rise in the price to be paid for these
skills.
 Cont..
ï Living Wage: his means that wages paid should
be adequate to enable an employee to maintain himself
and his family at a reasonable level of existence.

ï Managerial Attitudes: op management¶s

desire to maintain or enhance the company¶s prestige
is a major factor in the wage policy of a number of
firms.

ï Psychological and Social factors:

2sychologically persons perceives the level of wages as
a level of success in life. Sociologically, people feel that
equal work should carry equal wages
 GUIDELINES åOR
REGULATING WAGES &
SALARY ADMINISTRATION

´ Wage policies should be carefully developed, having in

mind the interest of«.
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´ It should be clearly expressed in writing.
´ It should be checked against the formulated policies.
 GUIDELINES åOR
REGULATING WAGES &
SALARY ADMINISTRATION
´It must inform to the employees in right way.
´It should be evaluated from time tso time.
´Departmental performance should be checked
periodically against the standards set in advance
´Job descriptions and performance rating should e
checked periodically to keep them up to date
 Problems in wages and
salary administration
ï High pressure from employees unions for
increasing the remuneration.
ï High pressure from management to reduce
cost.
Thank you