OBJECTIVES OF COMPENSATION

To attract capable employees to the

organization,
To motivate them toward superior
performance,
To retain their service over an extended period
of time.
STRUCTURE
40% base salary
35% flexible benefit plan
25% retirement benefits and
performance-based pay
LEVELS OF COMPENSATION
REMUNERATION
ELEMENTS
 FIXED REMUNERATION
VARIABLES:
DA
Fixed Bonus
Leave Travel Allowance
HRA
Medical Reimbursement Allowance
 VARIABLE REMUNERATION
VARIABLES:

Short & Long Term Incentives

Perquisites
Loans
 TYPES
OF
COMPENSATIONS
General Damages - compensation for
your injuries
Special Damages - compensation for
your financial losses
 FACTORS
AFFECTING
COMPENSATION
Supply and demand for employee skills,
Labor organizations,
The firm’s ability to pay,
Productivity of the firm and the economy,
Cost of living, and
Government.
What if employees feel
“under rewarded”
or
“over rewarded”
Distort either his own or other inputs or
outputs;
Behave in the same way as to induce
others to his own inputs or outputs;
Behave in some way as to change his
own inputs or outputs;
Choose a different comparison referent;
Leave the job.
 CURRENT
COMPENSATION
THINKING
Organizations need to develop a compensation
philosophy and direction in writing that is
reviewed by the Board of Directors and agreed to
by your managers.
Particularly in an entrepreneurial, market-driven
company, the compensation philosophy needs to
include a method for grouping similar jobs for
purposes of broad banding, since promotional
opportunities are limited.
It should include a responsible, measurement
system for awarding variable pay. I recommend
less emphasis on increasing base pay, and more
emphasis on distributing gains via bonuses that
reward actual goal attainment.
Goal attainment should be rewarded for both
individual and organizational goal achievement to
foster teamwork and eliminate the “lone ranger”
mentality.
Real goal achievement is attached to outcomes or
deliverables that are measurable or offer a shared
picture of what success looks like. They should not
reward checking items off a “to-do” list.
As the cost of benefits has increased, their place in a
total compensation package has increased in
importance. Shifting the costs of some benefits to
employees is a last-option scenario.
 SALARY AND
COMPENSATION TRENDS FOR
FORWARD
THINKING ORGANIZATIONS
Payment of a one-time, lump sum payment
for a result or outcome that deserves
recognition.
Payment of smaller rewards with “thank you”
notes for above the call of duty contributions
These are not necessarily tied to an achieved
result, but they are contributions, that when
emphasized, increase the probability of
results.
Increased emphasis on additional benefits
such as pre-paid legal assistance, educational
assistance, and vision insurance.
Increased opportunity for flexible work
arrangements and job-sharing.
An organizational emphasis on the training
and development of employees.
Clear career paths so employees see
opportunities within your organization.
RBI
DMRC
ABB Ltd.
Coca cola Pvt Ltd.
Unauthorised/Erroneous Debit
ECS direct debits/other debits to accounts
Payment of Cheques after Stop Payment
Instruction
Foreign Exchange Services
Remittances in India
• Payment of Interest for delayed Collection of
Outstation Cheques
• Cheques/Instruments lost in transit/in clearing process
or at paying bank’s branch
Violation of the Code by bank’s agent
Transaction of ‘at par instruments’ of Co-
operative Banks by Commercial Banks
Force Majeure
The person who has sustained the injury or
suffered any loss; or
All or any of the dependents of the deceased
where death has resulted from the accident; or
An agent duly authorized by the person injured
or all or any of the dependents of the deceased
Along with this, for construction related
mishaps, in addition to compensation DMRC
constitutes a LABOUR WELFARE FUND.
Main objectives of this fund are:
Further compensation to family through
additional schemes.
Widow and children of deceased worker are
given additional monetary assistance.
If children become orphan, their educational
requirement are met from fund.
ASEAN Brown boveri
Sports
Mutual Family Assistance Scheme
Funeral assistance
Educational assistance for children of
deceased employees
Educational scholarship for employees
children
Family Planning Incentives
Festival/Essential Commodity Loan
Executive Medical Check up
Annual Get together
Local Conveyance
Gift on Marriage
Corporate Card
Support for Higher Studies
Group Personal Accident Insurance
Entertainment of clients/contacts
Salary
Management Incentive Plan
Long-Term Incentive Plan
Stock Option Plan
Pension and other benefits
 CONCLUSION
Attracts capable employees to the organization
Motivates them towards superior performance,
Retains their service over an extended period
of time.
Benefits them and their family members.
Group Members:
Deepika Verma: (08-II-810)
Nishtha Arora: (08-II-828)
Mukul Ahluwalia: (08-II-825)
Surbhi Lakhani: (08-II-846)
Swati Saini: (08-II-849)