77145425 Compensation Management MBA HR

8/11/2019 77145425 Compensation Management MBA HR

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PAPER 3.6

Compensation

Management

M.B.A.


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COMPENSATION MANAGEMENT

MEANING OF WAGE/ COMPENSATION PAYMENT:

Wage is a monetary payment made by te emp!oyer to is emp!oyee "or te #or$ done orser%i&es rendered' It is a monetary &ompensation "or te ser%i&es rendered' A #or$er may be paid

(s' )** per day or (s' +,** per mont' Tis is #age payment' Te #or$er gi%es is ser%i&es andta$es payment &a!!ed #age payment' Ind-stria! #or$ers are paid rem-neration "or teir ser%i&esin terms o" money &a!!ed #age payment' Wages are -s-a!!y paid in &as at te end o" one day. onemont or one #ee$' Money #age is te monetary &ompensation or pri&e paid by te emp!oyer tois emp!oyee "or te ser%i&es rendered' S-& &ompensation is a!so &a!!ed #age or sa!ary orre#ard gi%en by an organiation to a person in ret-rn to a #or$ done'

Genera!!y. &ompensation payab!e to an emp!oyee in&!-des te "o!!o#ing tree &omponents:

0asi& &ompensation "or te 1ob 2#age/sa!ary3 In&enti%e &ompensation "or te emp!oyee on 1ob S-pp!ementary &ompensation paid to emp!oyees 2"ringe bene"it and emp!oyee ser%i&es3

4e"inition:A&&ording to Mi!$o%in& and 0o-drea-. 5Compensation re"ers to a!! "orms o" "inan&ia! ret-rns.tangib!e ser%i&es. and bene"its emp!oyee re&ei%ed as part o" teir emp!oyment re!ationsip'6

O07ECTI8E/GOA9S OF WAGE SA9A(Y:

)' Interna! e;terna! E


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)' To #or$er:

Wage payment is important to a!! &ategories o" #or$ers' Wage is a matter o" !i"e and deat to#or$ers/emp!oyees' Teir !i"e. #e!"are and e%en so&ia! stat-s depend on #age payment' It is on!yso-r&e o" in&ome to !arge ma1ority o" #or$ers' Tey and teir -nions a!#ays demand iger#ages and oter monetary bene"its'

Ma1ority o" !abo-r prob!ems and disp-tes are dire&t!y re!ated to #age payment' Te e""i&ien&y o"#or$ers and teir interest and in%o!%ement in te #or$ depend on #age payment' E%en teirattit-de to#ards emp!oyer depends on #age payment' In brie". #age payment is a matter o"greatest importan&e to #or$ers' Wage prob!em is te most pressing and persistent prob!em be"orete entire !abo-r "or&e'

=' To emp!oyer:

Wage payment is e


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Fair #ages is te #age #i& is abo%e te minim-m #age b-t be!o# te !i%ing #age' Ob%io-s!yte !o#er !imit o" te "air #age is te minim-m #age and te -pper !imit is set by te abi!ity o"te ind-stry to pay' 0et#een tese t#o !imits. "air #ages so-!d depend on te "a&tors !i$e

)' Pre%ai!ing rates o" #ages in te same o&&-pation

=' Pre%ai!ing rates o" #ages in te same region or neigbo-ring areas@' Emp!oyers abi!ity to pay+' 9e%e! o" nationa! in&ome and its distrib-tion,' Prod-&ti%ity o" !abo-r ' Stat-s en1oyed by te ind-stry in te e&onomy

Ben&e it &an be said tat "air #ages are determined on ind-stry &-m region basis' Wen "air#ages are paid emp!oyees en1oy iger standard o" !i%ing' It is a&&epted "a&t tat #ages m-st be"air and reasonab!e' Wages is "air #en te emp!oyee is ab!e to meet its essentia! needs and en1oyreasonab!e standard o" !i%ing' 6E


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Trade -nions do a""e&t te rate o" #ages' Genera!!y te stronger and more po#er"-! trade-nion. iger te #ages'

D' Prod-&ti%ity: Prod-&ti%ity is anoter &riterion and is meas-red in terms o" o-tp-t man>o-r' It is not d-eto !abo-r e""orts a!one' Te&no!ogi&a! impro%ements. greater ingen-ity and s$i!! by te !abo-r are

a!! responsib!e "or te in&rease in prod-&ti%ity'

' Pre%ai!ing mar$et rate: Tis is a!so $no#n as &omparab!e #ages? or ?going #age rate?' (eason beind tis is&ompetition demand tat &ompetitors adere to te same re!ati%e #age !e%e!'

' S$i!! !e%e!s a%ai!ab!e in te mar$et: Wit te rapid gro#t o" ind-stries. b-siness trade tere is sortage o" s$i!!ed reso-r&es'Te te&no!ogi&a! de%e!opment. a-tomation as been a""e&ting te s$i!!ed !e%e!s at a "aster rate'

)*' Psy&o!ogi&a! and so&ia! "a&tors: Tis determine in a signi"i&ant meas-re o# ard a person #i!! #or$ "or te &ompensation

re&ei%ed or #at press-res e #i!! e;ert to get is &ompensation in&reased'

Components O" Emp!oyee (em-neration:

Te rem-neration pa&$et o" an emp!oyee in&!-des #age/sa!ary. in&enti%es. "ringe bene"its.per


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Tese are monetary bene"its pro%ided to emp!oyees' Tey in&!-de te bene"it o": 2a3 Pro%ident"-nd. 2b3 Grat-ity. 2&3 Medi&a! &are. 2d3 Bospita!iation payment. 2e3 A&&ident re!ie". 2"3 Bea!tand Gro-p ins-ran&e. 2g3 S-bsidied &anteen "a&i!ities. 23 (e&reationa! "a&i!ities. and 2i3Pro%ision o" -ni"orms to emp!oyees'

+' Per


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,3 A%oids


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)3 9in$ing o" #ages #it prod-&tion: Bere #ages are !in$ed #it prod-&tion orprod-&ti%ity' It raises te prod-&ti%ity o" !abo-r' Wor$ers #or$ #it speed and -se teir &apa&ity"-!!y as te #age payment is dire&t!y re!ated to te re#ard re!ationsip in te pie&e rate system'+3 Fair to emp!oyer and emp!oyees: Tis system is "air to emp!oyers as #e!! as emp!oyees' Teemp!oyees get in&ome in proportion to prod-&tion gi%en by tem and te emp!oyer getsprod-&tion in proportion to te #age paid'

,3 In&enti%e system: Tis system ser%es as te in&enti%e system' Wor$ers #or$ e""i&ient!yand ta$e interest in te #or$ d-e to &orresponding bene"it/ re#ard in te "orm o" iger #agepayment'

3 9imited s-per%ision ade


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pie&e rate system on te gro-nd tat it #i!! !ead to ri%a!ry among #or$ers and destroy -nityamong tem'

,' Not "air to trainees: Pie&e rate system is not "air to trainees. as teir &apa&ity to prod-&e is!ess and nat-ra!!y tey #i!! get !ess #ages'

' H-a!ity o" prod-&tion is ad%erse!y a""e&ted: It a""e&ts te s!o# po!i&y and nat-ra!!y prod-&tion s-""ers'

En&o-rages #or$ers to ta$e more interest in te #or$ and nat-ra!!y prod-&tion in&reases'H-a!ity o" prod-&tion:H-a!ity. #or$mansip o" prod-&tion are not a""e&ted. ra# materia!s. ma&inery are -ti!isedproper!y' Te spoi!ed #or$ is a!so neg!igib!e'H-a!ity. #or$mansip o" prod-&tion may s-""er' In&rease in spoi!ed #or$ and #astage o" ra#materia!s'S-per%ision:

Stri&t s-per%ision is ne&essary as #or$ers are paid as per te period spent'Stri&t s-per%ision is not ne&essary as #or$ers are paid in proportion to te prod-&tion gi%en'


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S-itabi!ity:S-itab!e to man-"a&t-ring -nits. a!so s-itab!e #en indi%id-a! &ontrib-tion is not easi!ymeas-rab!e'S-itab!e #en &ontrib-tion o" indi%id-a! #or$er is meas-rab!e and #or$ is standardised andrepiti%e in &ara&ter'

INCENTI8E SYSTEMS OF WAGE PAYMENT:

Te #age p!an so-!d be ig!y in&enti%e means it so-!d en&o-rage #or$ers to ta$e moreinitiati%e and interest in te #or$. prod-&e more and a!so earn more' Te #age p!an #i& ser%esa!! tese p-rposes is &a!!ed in&enti%e #age p!an' S-& an in&enti%e p!an is bene"i&ia! to bot >emp!oyers and emp!oyees as #e!! as it is -se"-! "or te rapid ind-stria! gro#t'

In&enti%es in&!-de monetary as #e"t as non>monetary bene"its o""ered' Tere is moti%ation to#or$ ard and to earn more' In e%ery in&enti%e p!an. #ages are !in$ed #it te gi%en o-tp-t'In&enti%es are not "i;ed !i$e #ages and sa!aries' Tey %ary "rom indi%id-a! to indi%id-a! and "romperiod to period'

I9O de"ines in&enti%es as Kpayment by res-!tsK' In&enti%es &an a!so be des&ribed as Kin&enti%esystems o" paymentK'

A&&ording to 4a!e Yoder. 5In&enti%e #ages re!ate earnings to prod-&ti%ity and may -sepremi-ms. bon-ses. or a %ariety o" rates to &ompensate "or s-perior per"orman&e6 Pie&e ratesystem is te o!dest in&enti%e #age p!an #i& is a!so -se"-! "or attra&ting and retaining


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In te gro-p in&enti%e p!an. te in&enti%e is not "or indi%id-a! emp!oyee b-t "or te gro-p o"emp!oyees #or$ing in one department or se&tion' S-& gro-p in&enti%e p!an may &o%er te entire!abo-r "or&e o" a prod-&tion -nit' Te gro-p #i!! #or$ &o!!e&ti%e!y. gi%e more prod-&tion andsare te bene"it' Initia!!y te bene"it #i!! be gi%en to te gro-p and terea"ter. it #i!! be di%idedamong te members o" te gro-p'

Management is interested in gro-p in&enti%e p!an #i!e emp!oyees are interested in indi%id-a!in&enti%e p!ans' Prod-&tion a&ti%ities are no# &ond-&ted in an integrated manner and nat-ra!!yin&enti%es so-!d be o""ered to te emp!oyees' Gro-p in&enti%e p!ans are better as tey en&o-rageteam spirit and de%e!op &ooperation and -nderstanding among te emp!oyees' Tis a%oids#astages and promotes prod-&ti%ity'

FEATJ(ES/(EHJISITES OF A GOO4 INCENTI8E P9AN:

Simp!i&ity:A good in&enti%e p!an is one #i& is easy to -nderstand and simp!e to operate' An a%erage#or$er m-st be ab!e to $no# te in&enti%e o""ered and #at e is e;pe&ted to do' Te monetaryas #e!! as non>monetary bene"its o""ered m-st be made &!ear to a!! #or$ers'

En&o-rage initiati%e:A good in&enti%e p!an so-!d &reate initiati%e among #or$ers to #or$ more and to earn more' Itm-st o""er more in&ome to #or$ers and more pro"it/prod-&tion to te "irm or &ompany'

4e"initeness and "!e;ibi!ity:A good in&enti%e p!an so-!d be de"inite' Tis means "re


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A good in&enti%e p!an so-!d do 1-sti&e to bot parties' Te emp!oyer m-st get additiona!prod-&tion a!ong #it e;tra pro"it and te #or$ers m-st get e;tra payment "or e;tra prod-&tion'

P(OFIT>SBA(ING:

Pro"it>saring is regarded as a steppingstone to ind-stria! demo&ra&y' Pro"' Seager obser%es:KPro"it>saring is an agreement by #i& emp!oyees re&ei%e a sare. "i;ed in ad%an&e o" tepro"its'K

Pro"it>saring -s-a!!y in%o!%es te determination o" an organisationLs pro"it at te end o" te "is&a!year and te distrib-tion o" a per&entage o" te pro"its to te #or$ers saring. tey are reSBA(ING:Te main "eat-res o" te pro"it>saring s&emes are:2a3 Te agreement is %o!-ntary and based on 1oint &ons-!tation made "ree!y bet#een teemp!oyers and te emp!oyees'2b3 Te payment may be in "orm o" &as. sto&$ o" "-t-re &redits o" some amo-nt o%er andabo%e te norma! rem-neration tat #o-!d oter#ise be paid to emp!oyees in a gi%en sit-ation'2&3 Te emp!oyees so-!d a%e some minim-m


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+3 To de%e!op &ordia! !abo-r>management re!ations and to impro%e emp!oyee mora!e',3 To introd-&e in&enti%e #age p!an3 To raise prod-&ti%e e""i&ien&y by red-&ing &osts and in&reasing o-tp-tD3 To red-&e !abo-r t-rno%er and to impro%e p-b!i& re!ations'3 To pro%ide "or emp!oyee se&-rity in te e%ent o" deat. retirement or disabi!ity

A48ANTAGES OF P(OFIT>SBA(ING:

)3 E;tra in&ome to #or$ers: Wor$ers get e;tra &as payment d-e to pro"it>saring arrangement'Tis money is -se"-! "or raising teir #e!"are' Wor$ers &an p-r&ase &ost!y &ons-mer d-rab!eso-t o" tis money a%ai!ab!e at one time' T-s. pro"it>saring pro%ides better !i"e and #e!"are to#or$ers' It &reates &ontended !abo-r "or&e #it iger standard o" !i%ing' Pro"it>saring p!an a&tsas a good s-pp!ement to reg-!ar #ages paid to emp!oyees' In "a&t. pro"it>saring is apt!ydes&ribed as a "orm o" added rem-neration'

=3 Wor$ers ta$e more initiati%e and interest in te #or$: 4-e to pro"it>saring arrangement.#or$ers/ emp!oyees ta$e more interest in te #or$' Tis de%e!ops team spirit among teemp!oyees be&a-se teir sare in te pro"it depends on teir &o!!e&ti%e initiati%e. e""orts and ard

#or$' In tis sense. pro"it>saring is -se"-! "or moti%ating emp!oyees' It en&o-rages emp!oyees tobe reg-!ar. stab!e and e""i&ient as te bene"its o" tese e!ements are o""ered to tem tro-gpro"it>saring' Bere. e""orts and re#ard are dire&t!y and proportionate!y !in$ed' Tis en&o-ragesemp!oyees to ta$e $een interest in te #or$ and de%e!ops team spirit'Pro"it>saring a&ts not on!y as s-pp!ement to reg-!ar #ages 2i'e' as an in&enti%e #age p!an3 b-ta!so as a moti%ating "a&tor to a!! emp!oyees' It &reates &ommon ob1e&ti%e be"ore emp!oyer andemp!oyees and di%erts teir energies "or a&ie%ing one &ommon ob1e&ti%e'

@3 In&rease in prod-&tion and prod-&ti%ity: Pro"it> saring a&ts as a dri%ing "or&e "or moreprod-&tion and prod-&ti%ity' It moti%ates #or$ers "or raising prod-&tion as tey get dire&t andimmediate bene"it o" additiona! e""orts on teir part' Te bene"its o" in&rease in prod-&tion area%ai!ab!e to emp!oyer and emp!oyees'

+3 Fair to emp!oyer and emp!oyees: Pro"it>saring gi%es mere rem-neration to #or$ers a!ong #itmore pro"it to emp!oyer' Emp!oyer pays a part o" pro"it to #or$ers b-t e is not ad%erse!ya""e&ted as pro"it is paid on!y #en it e;&eeds a parti&-!ar !imit agreed by bot te parties' Tisarrangement is. &ertain!y "air to bot parties' Tere is an e!ement o" so&ia! 1-sti&e in it',3 Ens-res &ordia! ind-stria! re!ations: Pro"it>saring &reates &ordia! !abo-r>managementre!ations' It' red-&es ind-stria! disp-tes. stri$es and !o&$>o-ts' Tis is be&a-se bot a%e &ommonob1e&ti%e and bot are !i$e!y to s-""er d-e to ind-stria! disp-tes. stri$es and !o&$>o-ts' T-s.pro"it>saring red-&es ind-stria! disp-tes and !eads to "riend!y re!ations bet#een emp!oyer andemp!oyees'

T-s. pro"it>saring agreement en&o-rages #or$ers to #or$ e""i&ient!y and a!so a%oid disp-te and


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D3 Stabi!ity to !abo-r "or&e: Pro"it>saring brings stabi!ity to !abo-r "or&e as te bene"it o" pro"it>saring is -s-a!!y gi%en on!y to tose #o #or$ in te &ompany "or te #o!e year' T-s. pro"it>saring brings do#n te rate o" !abo-r t-rno%er and tis gi%es bene"it to te emp!oyer/management'

3 Promotes so&ia! 1-sti&e: Pro"it>saring is a metod o" so&ia! 1-sti&e' It is a metod by #i&

#or$ers are gi%en te re#ard o" teir ard #or$ and a!so a!!o#ed to parti&ipate in te progressand prosperity o" teir &ompany' Pro"it>saring introd-&es ind-stria! demo&ra&y as #or$ers aretreated not on!y as #age earners b-t a!so as partners "or saring te pro"its o" te &ompany'4ISA48ANTAGES OF P(OFIT>SBA(ING:

)3 Jn&ertainty: Tere is ig degree o" -n&ertainty in te pro"it>saring s&eme/p!an' Pro"it>saring is -n&ertain be&a-se it #i!! be paid on!y #en te pro"it e;&eeds a parti&-!ar !imit' Tepro"it may not &ross a parti&-!ar !imit d-e to mar$et "or&es and te #or$ers #i!! s-""er' T-s.pro"it>saring does not gi%e "-!! g-arantee o" e;tra payment to #or$ers' It a&ts !i$e a "air #eaterp!an'

=3 Jn"air to e""i&ient #or$ers: Pro"it>saring is a gro-p in&enti%e p!an' It gi%es esaring' Tey genera!!y oppose to pro"it>saring and demand bon-s "rom te emp!oyer asit is a &eap a!ternati%e to pro"it>saring'

+3 4isp-tes on &a!&-!ation o" net pro"it: In pro"it>saring. te net pro"it is to be &a!&-!ated at teend o" te "inan&ia! year' Tere is a possibi!ity o" di""i&-!ties as regards te &a!&-!ation o" te netpro"it' Te emp!oyer may !i$e to manip-!ate te a&&o-nts and so# !ess pro"it #i!e #or$ers may&a!&-!ate it as ig' S-& management re!ations: Sometimes. re!ations bet#een !abo-r andmanagement are ad%erse!y a""e&ted on te point o" pro"it>saring agreement' Tis de"eats te %eryp-rpose o" pro"it>saring' 4isp-tes are possib!e as regards te pro"it>saring agreement itse!"'

3 Not -se"-! d-ring depression: Pro"it>saring as a metod o" e;tra rem-neration to #or$ers &anbe -sed d-ring te period o" prosperity #en pro"its are ig' It &annot be -sed d-ring te yearso" depression' E%en ne#!y estab!ised &ompanies are not in a position to introd-&e pro"it>sarings&eme "or teir emp!oyees'

D3 Opposition "rom &onser%ati%e emp!oyers: Te &on&ept o" pro"it>saring is not "-!!y a&&eptab!eto &onser%ati%e emp!oyers' Tey "ee! tat pro"it is te re#ard "or te ris$s and -n&ertainties' Teya!so arg-e tat #or$ers m-st be prepared to sare pro"it as #e!! as !oss in te b-siness'


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F(INGE 0ENEFITS

MEANING OF F(INGE 0ENEFITS:

Fringe bene"its may be de"ined as #ide range o" bene"its and ser%i&es tat emp!oyees re&ei%e asan integra! part o" teir tota! &ompensation pa&$age' Tey are based on &riti&a! 1ob "a&tors andper"orman&e' Fringe bene"its &onstit-te indire&t &ompensation as tey are -s-a!!y e;tended as a&ondition o" emp!oyment and not dire&t!y re!ated to per"orman&e o" &on&erned emp!oyee' Fringebene"its are s-pp!ements to reg-!ar #ages re&ei%ed by te #or$ers at a &ost o" emp!oyers' Teyin&!-de bene"its s-& as paid %a&ation. pension. ea!t and ins-ran&e p!ans. et&' S-& bene"its are&omp-tab!e in terms o" money and te amo-nt o" bene"it is genera!!y not predetermined'Te p-rpose o" "ringe bene"its is to retain e""i&ient and &apab!e peop!e in te organisation o%er a

!ong period' Tey "oster !oya!ty and a&ts as a se&-rity base "or te emp!oyees'

FEATJ(ES OF F(INGE 0ENEFITS:

4i""erent "rom reg-!ar #ages: Fringe bene"its are di""erent "rom reg-!ar #ages as s-&bene"its are tose payments. #i& an emp!oyee en1oys in addition to #ages e re&ei%es' It is as-pp!ementary payment and pro%ides s-pport to an emp!oyee'

Emp!oyee moti%ation: Fringe bene"its are not gi%en to emp!oyees "or per"orming &ertain1obs' Te p-rpose is to en&o-rage tem to ta$e more interest in te assigned #or$'

Jse"-! b-t a%oidab!e e;pendit-re: Fringe bene"its &onstit-te a !abo-r &ost "or te

emp!oyer'

Not dire&t!y !in$ed #it e""orts: Fringe bene"its are not dire&t re#ard "or te e""orts madeor te prod-&tion gi%en by an emp!oyee'

0ene"i&ia! to a!! emp!oyees: Fringe bene"its are a !abo-r &ost b-t its bene"its so-!d bemade a%ai!ab!e to te entire !abo-r "or&e and not to a sma!! gro-p o" emp!oyees'

O07ECTI8ES OF F(INGE 0ENEFITS:

To s-pp!ement dire&t rem-neration: Fringe bene"its s-pp!ement reg-!ar pay o" emp!oyed'

It raises te tota! earnings o" an emp!oyee and pro%ides better !i"e and #e!"are to im' Emp!oyers pre"er "ringe bene"its: emp!oyers pre"er tis indire&t rem-neration to dire&tpay in&rease' To retain &ompetent emp!oyees: Fringe bene"its &reate satis"ied !abo-r "or&e' In addition.te management &an attra&t and retain &ompetent personne! in te organisation by o""ering !ibera!pa&$et o" "ringe bene"its' To de%e!op good &orporate image: Fringe bene"its e!p to de%e!op a good &orporateimage' To raise emp!oyee mora!e: 9ibera! pa&$age o" Fringe raises te mora!e o" emp!oyees'


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9IMITATIONS OF F(INGE 0ENEFITS:

Tere are some !imitations o" Fringe 0ene"its' Tese are:

Fringe 0ene"its may !ead to -nea!ty &ompetition among emp!oyees Te e;pe&ted bene"it may not be a%ai!ab!e i" te monetary bene"its are not ade


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Company &ar and membersip o" &!-bs. et& Mo%ing e;penses' Ci!d &are "a&i!ities' Too! e;penses and mea! a!!o#an&es. et&


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UNIT 1: INTRODUCTION

Compensation is an a&ti%ity by #i& organiations e%a!-ate te &ontrib-tions o" emp!oyees inorder to distrib-te "air!y. dire&t and indire&t monetary and non monetary re#ards #itin teorganiation s abi!ity and !ega! reg-!ations' 5Compensation &an be de"ined as te "inan&ia! andnon "inan&ia! re#ards pro%ided by an emp!oyer "or te time. s$i!!s and te e""ort made a%ai!ab!e

by te emp!oyee in "-!"i!!ing 1ob re


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To de%e!op a &ompetiti%e ad%antage in a g!oba! e&onomy. te &ompensation program o" teorganiation m-st s-pport tota!!y te strategi& p!ans and a&tions o" te organiation' Teindi%id-a!s o&&-pying te e;e&-ti%e positions o" te organiation are responsib!e "or estab!isingand de%e!oping te strategy o" te organiation' Te o%era!! strategi& p!ans in"orm a!! o" itsmembers o" te dire&tion te organiation #ises to ta$e' Management and organiationa!spe&ia!ists re%ie# tese strategi& p!ans and ta$e te a&tions ne&essary #itin teir domain to

ens-re a&&omp!isment o" te p!ans'

For te -man reso-r&es &ompensation spe&ia!ist. te assignment to ens-re a&&omp!isment o"organiationa! strategy begins #it determining.

)' Te #or$ tat m-st be per"ormed by some #or$ -nit or indi%id-a!'=' Te $inds and !e%e!s o" $no#!edge and s$i!!s re


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+' 4isabi!ity in&ome &ontin-ation: Te possibi!ity a!#ays e;ists tat a #or$er #i!! in&-rea!t or a&&ident disabi!ity be&a-se o" tese disabi!ities emp!oyees are "reterm strategi& ob1e&ti%es o" teorganiation #it its sort>term ta&ti&a! re


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To impro%e &ost and term goa!s and !ong>term ob1e&ti%es'

Mi"oe"onomi" Fa"tos:

a' 7ob des&riptionb' 7ob Ana!ysis'&' 7ob e%a!-ation

d' Pay str-&t-ree' Sa!ary s-r%erys'"' Po!i&ies and reg-!ations'

7ob 4es&riptions A &riti&a! &omponent o" bot &ompensation and se!e&tion systems. 1obdes&riptions de"ine in #riting te responsibi!ities. re


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payment re&ei%ed by an emp!oyee in e;&ange "or !abo-r' It may be in goods or ser%i&es b-t is&-stomari!y in money' Te term in a broad sense re"ers to #at is re&ei%ed in any #ay "or !abo-r.b-t #ages -s-a!!y re"er to payments to #or$ers #o are paid by te o-r. in &ontrast to a sa!ary.#i& imp!ies a more "i;ed and permanent "orm o" in&ome 2e'g'. payment by te mont ratertan by te o-r3' In e&onomi& teory. #ages re&$oned in money are &a!!ed nomina! #ages. asdisting-ised "rom rea! #ages. i'e'. te amo-nt o" goods and ser%i&es tat te money #i!! b-y'

(ea! #ages depend on te pri&e !e%e!. as #e!! as on te nomina! or money #ages'

1. &UB&I&TANCE T-EOR OF ,A/E& 0 IRON A, OF ,A/E&

It #as Tomas (' Ma!t-sLs teory o" pop-!ation tat pro%ided te ra# materia! "or te "irste&onomi& #age teory' Pop-!ation. a&&ording to te teory. is !imited by te means o"s-bsisten&e: it in&reases geometri&a!!y #ereas te means o" s-bsisten&e in&reases aritmeti&a!!y'4a%id (i&ardo trans!ated Ma!t-sLs teory into te s-bsisten&e teory o" #ages' A&&ording to tisteory. #ages in te !ong r-n tend to e #eter #agesdetermine standard o" !i%ing or te !atter determines te "ormer' In "a&t. #or$ers are nota&&-stomed to any "i;ed standard o" !i%ing'

3. RE&IDUA CAIMANT T-EOR

Fran&is A' Wa!$erLs resid-a! &!aimant teory may be to-gt o" as an Ameri&an %ersion o" te#ages>"-nd teory' Bere. te #or$ersL demand "or #ages represents te resid-a! &!aimant on


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o-tp-t a"ter rent. interest. and pro"it a%e been independent!y determined and ded-&ted'Assigning #ages rater tan pro"its as te resid-a! seems &-rio-s. b-t it does s-ggest tatdistrib-tion o" in&ome is a matter o" de&ision' It a!so permitted Wa!$er to s-ggest tat i" !aborin&reased its prod-&ti%ity #ito-t te -se o" more &apita! or !and. its resid-a! #o-!d in&rease > tegerm o" a prod-&ti%ity teory'

4. ,A/E&0FUND T-EORTe sort>term %ersion o" &!assi&a! #age teory #as te #ages>"-nd teory' As des&ribed by 7onSt-art Mi!!. tis teory e;p!ained te sort>term %ariations in te genera! #age !e%e! in terms o"2)3 te n-mber o" a%ai!ab!e #or$ers and 2=3 te sie o" te #ages "-nd' Te #ages "-nd #asto-gt to &ome "rom reso-r&es a&&-m-!ated by emp!oyers "rom pre%io-s years and a!!o&ated bytem to b-y !abor &-rrent!y' Emp!oyers #ere to-gt to a%e a "i;ed sto&$ o" K&ir&-!ating &apita!K"or te payment o" #ages' 4i%iding te !abor "or&e 2ass-med to be te pop-!ation3 into te #ages"-nd determined te #age' Te teory erred in ass-ming tat a "i;ed "-nd "or te payment o"#ages e;ists and tat it a&&o-nts "or !abor demand' Most #or$ers are paid o-t o" &-rrentprod-&tion' Emp!oyers ba!an&e !abor &osts against oter &osts in determining !abor demand' 0otemp!oyers and #or$ers. o#e%er. o"ten ta!$ as i" s-& "-nds e;ist and as i" tey determine teamo-nt o" !abor ser%i&es needed' Tey may a!so a&&ept te imp!i&ation o" te teory tat any gain

to one gro-p is a !oss to oters'

5. MAR/INA0PRODUCTIIT T-EOR:

Some o" te modern e&onomi&s e;p!ain te determination o" #ages by means o" margina!prod-&ti%ity ana!ysis' A&&ording to tis teory:KWages in per"e&t &ompetition tend to be e


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KWages tend to be e

2i3 4emand "or !abor is a deri%ed demand' Te demand "or !abor is not a dire&t demand' It isderi%ed "rom te demand "or te &ommodities and ser%i&es it e!ps !o prod-&e' I" te demand "ora prod-&t is ig in te mar$et. te demand "or !abor prod-&ing tat parti&-!ar type o" prod-&t


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#i!! a!so be ig' In &ase. te demand "or a &ommodity is sma!!. te demand "or tat !abor #i!!a!so be !o#'

2ii3 E!asti&ity o" demand "or te prod-&t' I" te demand "or a parti&-!ar prod-&t is ine!asti&. tedemand "or te type o" !abor tat prod-&es tis prod-&t #i!! a!so be ine!asti&' Te demand "or!abor #i!! be e!asti&. i" &eaper s-bstit-tes o" te prod-&t are a%ai!ab!e in te mar$et or te

demand "or te &ommodity it prod-&es is e!asti&'

2iii3 Proportion o" !abor &ost to tota! &ost' I" te #ages o" #or$ers a&&o-nt "or on!y a sma!!proportion to tota! &ost o" a prod-&t. ten te demand "or !abor #i!! tend to be ine!asti&' In a&apita! intensi%e ind-stry. "or instan&e. a s!igt in&rease in te #or$ers #ages #it a%e !itt!ee""e&t on te -nit &ost o" prod-&t So. te rise in #ages #i!! not red-&e te demand "or !abor'

2i%3 A%ai!abi!ity o" s-bstit-tes "or !abor' I" te s-bstit-tes o" !abor prod-&ing a parti&-!ar prod-&tare easi!y a%ai!ab!e in te mar$et. te demand "or !abor #i!! ten be e!asti&'

A"ter &onsidering te %ario-s "a&tors #i& in"!-en&e 2e demand "or !abor. #e no# ta$e -p tedemand pri&e o" !abor'

4emand Pri&e o" 9abor:

Margina! (e%en-e Prod-&ti%ity 2M(P3' An emp!oyer ires !abor in order to ma$e pro"it' Be.#i!e emp!oying a #or$er. &ompares te &ost o" iring a #or$er to te &ontrib-tion e is e;pe&tedto ma$e to te tota! re%en-e o" te "irm' So !ong as te addition made by te !abor to te re%en-eis greater tan te &ost o" emp!oying im. te entreprene-r #i!! engage tat !abor' In oter #ords.#e &an say tat so !ong as te margina! re%en-e prod-&t o" !abor is iger tan te &ost o"emp!oying im. te emp!oyer emp!oys tat #or$er' Te entreprene-r #i!! &ontin-e iring te#or$er -p to te point at #i& te &ost o" emp!oying a #or$er is 1-st er-n' Te s-pp!y o" !aborere depends on te a%ai!abi!ity o" #or$ers in te !o&a!ity and "rom te nearby areas and te#i!!ingness o" te !abor to #or$ o%ertime' In te !ong>r-n. te s-pp!y o" !abor "or te ind-stry ismore e!asti&' Te !abor &an be attra&ted by o""ering iger #ages. pro%iding training "a&i!ities.ma$ing #or$ing &onditions p!easant et&. So te s-pp!y o" !abor "or te ind-stry is o" te norma!sape rising -p#ard "rom !e"t to te rigt'


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Wage 4etermination:

So "ar #e a%e dis&-ssed te "or&es operating beind te demand "or and s-pp!y o" !abor in temar$et' As regards te pri&e or te #age o" parti&-!ar grade o" !abor. it is determined by teintera&tion o" te "or&es o"' demand "or and s-pp!y o" !abor in te &ompetiti%e mar$et'

CONCEPT& OF IIN/ MINIMUM AND FAIR ,A/E&:

)' Minim-m Wage=' 9i%ing Wage@' Fair Wage

MINIMJM WAGETe &on&ept o" 5Minim-m Wage6 stands "or di""erent standard o" di""erent &o-ntries' Te "air#age &ommittee in India as obser%ed tat in India te !e%e! o" te nationa! in&ome is so !o# atpresent tat it is genera!!y a&&epted tat te &o-ntry &annot a""ord to pres&ribe by !a# a minim-m#age m-st pro%ide not mere!y "or te bare s-stenan&e o" !i"e b-t "or te preser%ation o" tee""i&ien&y o" te #or$er' T-s. a minim-m #age is one. #i& may be s-""i&ient to enab!e ae

not ta?0$e$*"ti#e. Compensation "+ages t+at epesent a"t*a# o*tgoings ="as+ o*t!#o9 o a"t*a#

#iai#it'> to t+e "ompan' ma' e $e$*"ti#e s*"+ as t+e *'ing a"( o! its o9n s+aes i.e. teas*'

s+aes to satis!' t+e o#igation to t+e emp#o'ees.

In a$$ition s*"+ s+ae0ase$ "ompensation "osts m*st e $ie"t#' e#ate$ to t+e emp#o'eeHs

emp#o'ment "ompensation ene!its in &ingapoe to e ta?0$e$*"ti#e. T+e "ompensation "osts to t+e


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35/67

*t !o 'o* entie !ami#' as 9e##.

&taggee$ 9o(ing +o*s

I! 'o* 9o*#$ pe!e to 9o( !om +ome o stat #ate in t+e $a' 'o* "an at IBM. ,e gi8e 'o* t+e

!#e?ii#it' to manage 'o* 9o( +o*s so 'o* "an meet t+e nee$s o! 'o* pesona# #i!e.

COMPEN&ATION BENEFIT PRACTICE& PRO/RAM& AND POICIE&.

Emp#o'ee Bene!its:

Bene!it P#an Costs

-ea#t+ Cae P#ans

=PPO PO& -MO -&A>

Denta# Cae P#ans

Retiement P#ans

F#e?i#e Bene!it P#ans

Disai#it' Bene!it P#ans

/o*p i!e ADD Ins*an"e P#ans

Bene!its !o Pat0Time Emp#o'ees

Domesti" Patne Bene!its Emp#o'ee Po#i"ies an$ Pogams:

Pai$0Time O!! =PTO>

A#tenati8e ,o( &"+e$*#es

=in"#*$ing Te#e"omm*ting>Re"*iting an$ -iing

-iing Bon*ses

Re!ea# Bon*ses

Retention Bon*ses

&e8ean"e Pa"ti"es

,o(p#a"e En8ionment

Caee P#anning Po!essiona# De8e#opment

Mi#ita' ea8e Po#i"'

Bene!it P#an Costs

Bene!it Costs as Pe"ent o! Pa'o##

o Me$i"a# Denta# ision Disai#it' i!e ADD P#ans

o Retiement P#ans

Bene!its Costs as a Mont+#' Amo*nt Pe Emp#o'eeo Me$i"a# Denta# ision Disai#it' i!e ADD P#ans

o Retiement P#ans

-ea#t+ Cae P#ans =PPO -MO PO&>

Mont+#' Pemi*ms

o Pemi*m Cost

o Pe"ent o! Pemi*ms Pai$ ' Compan'

De$*"ti#es

o Pe"ent o! P#ans 9it+ De$*"ti#es

o Ann*a# De$*"ti#e Amo*nts

Coins*an"e

o Pe"ent o! E?pense Co8ee$ ' P#an

O*t0o!0Po"(et Ma?im*ms =OOP>

o Pe"ent o! P#ans 9it+ OOP Ma?im*mso Ann*a# OOP Amo*nts

i!etime Reim*sement imits

o Pe"ent o! P#ans 9it+ i!etime imits

O!!i"e isit an$ Pes"iption Co0Pa'ments

Domesti" Patne Me$i"a# Bene!its

-&A *a#i!ie$ -ea#t+ P#ans

Impa"t on Ot+e -ea#t+"ae Options

Mont+#' Pemi*m Costs

Pe"ent o! Pemi*ms Pai$ ' Compan'


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Ann*a# De$*"ti#es

O*t0o!0Po"(et Ma?im*ms =OOP>

i!etime Reim*sement imits

Pes"iption E?pense Co8eage

Compan' Conti*tions

Denta# Cae P#ans

T'pes o! Denta# P#ans O!!ee$

Timing o! Emp#o'ee E#igii#it' to Eno##

E?penses Co8ee$

Costs o! Mont+#' Pemi*ms

Pe"ent o! Mont+#' Pemi*m Pai$ ' Compan'

De$*"ti#es an$ Co0Ins*an"e

O*t0o!0Po"(et =OOP> Ma?im*ms

Ot+o$onti" E?pense Co8eage

Ot+o$onti" Reim*sement imits

Retiement P#ans

T'pes o! Retiement P#ans A8ai#a#e to Emp#o'ees

o De!ine$ Bene!it P#an

o 4L1=(>

o &imp#e0IRA

o Po!it &+aing P#ano E&OP

o &EP0IRA

o &a#a' Re$*"tion &EP

E#igii#it' Re)*iements

,+en $o Emp#o'ee Conti*tions F*##' est

Retiement P#an Costs

o as a Pe"entage o! Pa'o##

o pe Emp#o'ee

4L1=(> Mat"+ing Po#i"'

F#e?i#e Bene!it P#ans

Pemi*m Con8esionPemi*m On#' P#an =POP>

Uneim*se$ Me$i"a# E?penses =UME>

Depen$ent C+i#$ Cae E?penses =DCC> Depen$ent A$*#t Cae E?penses =DAC>

A$option Assistan"e E?penses =AAE>

Ca!eteia P#an

Tanspotation Bene!it P#an

Disai#it' Bene!it P#ans =&+ot0 an$ ong0Tem>

,+o Pa's t+e Pemi*m

E#igii#it' !o Disai#it' Bene!its

,aiting Peio$s

D*ation o! P#ans

&etting Amo*nt o! Disai#it' Bene!its

Disai#it' Pa'o*ts

/o*p i!e ADD Ins*an"e P#ans

/o*p i!e P#anso Bene!it Amo*nts

o Cost Co8eage

o &*pp#ementa# i!e Ins*an"e

A""i$enta# Deat+ Dismemement =ADD> Ins*an"e

o Bene!it Amo*nts

Bene!its !o Pat0Time Emp#o'ees

Bene!its A8ai#a#e

,o( Re)*iements !o E#igii#it'

Co8eing t+e Costs


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Domesti" Patne Bene!its

Domesti" Patne -ea#t+"ae Bene!its: Co8eage

E#igii#it' Re)*iements

Emp#o'ee Po#i"ies an$ Pogams "o8ee$:

Pai$0Time O!! Po#i"ies

N*me o! Da's Pai$ Time O!! Po8i$e$ ' T'pe o! Da':

o -o#i$a's

o F#oating -o#i$a's

o &i"( Da's

o a"ation Da's

o Pesona# Da's

o Ann*a# ea8e Poo#

o Ot+e Pai$ Time O!!

N*me o! Da's Pai$ Time O!! Po8i$e$ ' T'pe o! Mo$e#:

o Ta$itiona# Mo$e# 9it+ &pe"i!ie$ &i"( ea8e

o Ta$itiona# Mo$e# 9it+o*t &pe"i!ie$ &i"( ea8e

o Ann*a# ea8e Mo$e#

Teatment o! Un*se$ Pai$0Time O!!:

o Un*se$ a"ation Da's

o Un*se$ &i"( Da's

o Un*se$ Ann*a# ea8e Da'so Time imits on t+e Use o! Caie$0O8e Pai$ Time O!!

o A""*a# o! Pai$ Time O!!

o Upon Temination

A#tenati8e ,o( &"+e$*#es

T'pes o! A#tenati8e ,o( &"+e$*#es O!!ee$:

o Te#e"omm*ting

o F#e?i#e ,o( -o*s

o Compesse$ ,o( ,ee(s

o


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Retention Bon*ses

Retention Bon*s E#igii#it' ' Emp#o'ee T'pe an$ e8e#

Ca#"*#ating Retention Bon*ses

Retention Bon*s Amo*nts ' Emp#o'ee T'pe an$ e8e#

Pa'ment o! Retention Bon*ses

&e8ean"e Pa"ti"es

&e8ean"e Pa"ti"es ' Compan' &i%e

Ca#"*#ation o! &e8ean"e

&e8ean"e Pa' Amo*nts

P#a"ement &e8i"es O!!ee$

Re#ease Ageements

Ten$s in &e8ean"e Amo*nts

,o(p#a"e En8ionment

Dess Co$es

,o( &pa"e A##o"ation

Compan' &ponsoe$ E8ents an$ A"ti8ities

Caee P#anning an$ Po!essiona# De8e#opment Pogams

Caee P#anning Pogams

o Con!een"e Atten$an"e

o Po!essiona# Memes+ipso T*ition Reim*sement

o Ta$e


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Bon*ses. Emp#o'ee on*ses 9+i"+ ae *s*a##' pai$ in a sing#e #*mp at t+e en$ o! t+e 'ea ae one

9a' o! po8i$ing pe!oman"e in"enti8es. Po!it0s+aing p#ans ae a moe !oma# 9a' o! $oing t+is

*t t+e';e not as e!!e"ti8e !o e9a$ing in$i8i$*a# pe!oman"e an$ "ompensating emp#o'ees !o

meeting t+ei goa#s.

ong0tem in"enti8es. &to"( options o sto"( gants not on#' po8i$e #ong0tem in"enti8es to

emp#o'ees *t t+e' "an a#so +e#p etain 8a#*a#e team memes t+o*g+ 'o* ogani%ation;s "*"ia#

stat0*p p+ase.

-ea#t+ ins*an"e. Emp#o'e0sponsoe$ +ea#t+ ins*an"e is !ai#' stan$a$ among me$i*m0si%e

"ompanies. An$ it;s a ene!it t+at +as geat 8a#*e to emp#o'ees. An emp#o'e0sponsoe$ p#an sa8es

emp#o'ees mone' an$ gi8es t+em pea"e o! min$ in (no9ing t+at t+e' 9on;t e $enie$ "o8eage e8en

i! t+e' +a8e e?isting +ea#t+ po#ems.

I! 'o* t+in( 'o* "an;t a!!o$ it t+in( again. Po8i$ing ins*an"e to 'o* emp#o'ees sen$s t+e

message t+at 'o* "ae ao*t t+ei +ea#t+ an$ t+e +ea#t+ o! t+ei !ami#ies. To minimi%e "osts "onsi$e

+a8ing emp#o'ees pi"( *p pat o! t+e ta. Emp#o'ees 9+o +a8e "o8eage t+o*g+ a spo*se ma' 9ant

to opt o*t o! a p#an pati"*#a#' i! t+ee;s a "ost asso"iate$ 9it+ it.

i!e an$o $isai#it' ins*an"e. T+is is a#so a ene!it t+at *s*a##' "osts #ess 9+en it;s p*"+ase$ '

an emp#o'e at+e t+an an in$i8i$*a#.

Retiement p#ans. 4L1=(> p#ans +a8e e"ome pop*#a e"a*se t+e' ae e#ati8e#' eas' to a$ministe

an$ ae #ess e?pensi8e t+an ta$itiona# pension p#ans. Man' emp#o'ees #i(e t+ese p#ans e"a*se t+e'

maintain some "onto# o8e t+e amo*nt o! t+ei "onti*tion an$ +o9 t+e mone' is in8este$. Most

sma## "ompanies t' to p*t some (in$ o! sa8ings o 4L1=(> p#an in p#a"e e8en i! t+e' $on;t "onti*temone' to t+em.

Time o!! an$ !#e?i#e s"+e$*#es. T+is in"#*$es +o#i$a's 8a"ations si"( $a's an$ pesona# $a's. An

emp#o'e *na#e to o!!e "ompetiti8e sa#aies ma' "#ose pat o! t+e gap ' o!!eing moe time o!! o

!#e?i#e 9o( +o*s. &ome emp#o'es ma(e no $istin"tion et9een si"( 8a"ation an$ pesona# $a's

an$ a##o9 emp#o'ees a set n*me o! $a's o!! ea"+ 'ea to e *se$ at t+ei $is"etion. T+is pe8ents

emp#o'ees !om a*sing si"( $a's an$ (eeps emp#o'ees !om !ee#ing t+at t+e' nee$ to #ie 9+en a

"+i#$ is i## o a pesona# emegen"' aises.

Mis"e##aneo*s "ompensation. Ot+e !oms o! "ompensation to "onsi$e in"#*$e emp#o'ee assistan"e

pogams 9+i"+ "an po8i$e e8e't+ing !om ps'"+o#ogi"a# "o*nse#ing to #ega# assistan"eG $is"o*nts

on "ompan' po$*"tsG *se o! a "ompan' "asG an$ an' ot+e in"enti8es t+at moti8ate emp#o'ees an$

gi8e 'o* "ompan' a "ompetiti8e a$8antage.

Compensation pa"(age o! a top e?e"*ti8e

T+e tota# "ompensation pa"(age o! a top e?e"*ti8e 9i## genea##' +a8e some Comination o! t+e!o##o9ing "omponents: ase sa#a' s+ot0tem on*s ase$ on Pe!oman"e o8e t+e past t9e#8e

mont+s #ong0tem on*s ase$ on pe!oman"e o8e t+e past 305 'eas sto"( options =)*a#i!ie$

an$o non0)*a#i!ie$> esti"te$ sto"( sto"(

p*"+ase an$ po!it s+aing. E8e't+ing in a$$ition to ase sa#a' is not t'pi"a# o! 9+at t+e a8eage

9o(e e"ei8es an$ ea"+ item s+o*#$ e e?amine$ in $i8i$a#e. On op o! t+e ao8e t+ee 9i## a#so e

a pension a## t+e *s*a# ins*an"e =+ea#t+ $enta# $isai#it' #i!e> an$ spe"ia# !inge ene!its anging

!om ta? pepaation to "o*nt' "#* memes+ip. An' pa"ti"ing e"onomist 9+o +as e8e $ea#t 9it+

t+e "ompensation pa"(age o! a +ig+#' pai$ e?e"*ti8e 9i## +a8e an *n$estan$ing o! t+e "omp#e?ities

in8o#8e$ in 8a#*ation "ompae$ to a noma# 9age eane.

Pa'o## Management

B-man (eso-r&e is te most %ita! reso-r&e "or any organiation' It is responsib!e "or ea& and e%ery

de&ision ta$en. ea& and e%ery #or$ done and ea& and e%ery res-!t' Emp!oyees so-!d be managedproper!y and moti%ated by pro%iding best rem-neration and &ompensation as per te ind-stry standards'Te !-&rati%e &ompensation #i!! a!so ser%e te need "or attra&ting and retaining te best emp!oyees'

Compensation is te rem-neration re&ei%ed by an emp!oyee in ret-rn "or is/er &ontrib-tion to teorganiation' It is an organied pra&ti&e tat in%o!%es ba!an&ing te #or$>emp!oyee re!ation by pro%idingmonetary and non>monetary bene"its to emp!oyees' Compensation is an integra! part o" -man reso-r&emanagement #i& e!ps in moti%ating te emp!oyees and impro%ing organiationa! e""e&ti%eness'

Components o! Compensation &'stem


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Compensation systems are designed $eeping in minds te strategi& goa!s and b-siness ob1e&ti%es'Compensation system is designed on te basis o" &ertain "a&tors a"ter ana!ying te 1ob #or$ andresponsibi!ities' Components o" a &ompensation system are as "o!!o#s:

T'pes o! Compensation

Compensation pro%ided to emp!oyees &an dire&t in te "orm o" monetary bene"its and/or indire&t in te"orm o" non>monetary bene"its $no#n as per$s. time o"". et&' Compensation does not in&!-de on!y sa!aryb-t it is te s-m tota! o" a!! re#ards and a!!o#an&es pro%ided to te emp!oyees in ret-rn "or teir ser%i&es' I"te &ompensation o""ered is e""e&ti%e!y managed. it &ontrib-tes to ig organiationa! prod-&ti%ity'

Die"t Compensation

4ire&t &ompensation re"ers to monetary bene"its o""ered and pro%ided to emp!oyees in ret-rn o" te ser%i&estey pro%ide to te organiation' Te monetary bene"its in&!-de basi& sa!ary. o-se rent a!!o#an&e.&on%eyan&e. !ea%e tra%e! a!!o#an&e. medi&a! reimb-rsements. spe&ia! a!!o#an&es. bon-s. P"/Grat-ity. et&'Tey are gi%en at a reg-!ar inter%a! at a de"inite time'

In$ie"t Compensation

Indire&t &ompensation re"ers to non>monetary bene"its o""ered and pro%ided to emp!oyees in !ie- o" teser%i&es pro%ided by tem to te organiation' Tey in&!-de 9ea%e Po!i&y. O%ertime Po!i&y. Car po!i&y.Bospita!iation. Ins-ran&e. 9ea%e tra%e! Assistan&e 9imits. (etirement 0ene"its. Bo!iday Bomes'


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more prone to errors'

A""o*ntant

A&&o-ntant is a pro"essiona! a%ing a degree/dip!oma &o-rse in "inan&e/a&&o-ntan&y' Be/se is responsib!e"or a!! te a&ti%ities re!ated to payro!! a&&o-nting' Be/se as te so-nd $no#!edge o" a&&o-nting prin&ip!esand g!oba!!y a&&epted standards'Te pro&ess adds &osts to te organiation' It in%o!%es paying someone #o is responsib!e "or &a!&-!atingte sa!aries o" oters' Te "inan&ia! &ontro! regarding sa!ary goes in te and o" a&&o-ntant'

Pa'o## &o!t9ae

In today?s &omp-teried en%ironment. payro!! system as a!so de%e!oped itse!" into a-tomated so"t#are tat

per"orms e%ery a&tion needed by te payro!! pro&ess' It e!ps in &a!&-!ating te payab!e amo-nts andded-&tions %ery easi!y' It a!so e!ps in generating te pay s!ips in !esser time' A-tomated &a!&-!ations res-!tin no errors' 4ata is %a!idated a-tomati&a!!y by te so"t#are'It needs pro"essiona!s to ma$e -se o" te so"t#are "or its e""i&ient #or$ing'

Pa'o## O*tso*"ing

Payro!! o-tso-r&ing in%o!%es a tird party 2an o-tso-r&ing &ompany3 in te &a!&-!ations o" sa!aries andded-&tions' Te o-tso-r&ing organiation is responsib!e "or a!! te a&ti%ities o" te payro!! a&&o-nting' Itsa%es time and &ost "or te organiation' I" tere is more n-mber o" emp!oyees 2say more tan **>)***3 inte organiation. payro!! o-tso-r&ing #o-!d be %ery m-& bene"i&ia!'

Te data is pro%ided to te &ons-!tants/o-tso-r&ing "irms' Te %ario-s payro!! "-n&tions -nderta$en by teo-tso-r&ing organiations are as "o!!o#s:

-!RAna!ysis o" Payro!! re&ords. payro!! ta;esMedi&a! &!aim pro&essingEmp!oyee Ins-ran&e Pro%ident "-nd pro&essing9EA8E T(A8E9 CONCESSION

WBAT A(E TBE 9IMITS OF EQEMPTION IN 9'T'C' is granted to an emp!oyee in &onne&tion #it te1o-rney on !ea%e by im or is "ami!y' It is e;empt "rom in&ome ta; #itin &ertain !imits as -nder : >

2a3 Were 1o-rney is per"ormed by rai! rai!#ay>"are in Se&ond AC &!ass by sortest ro-te to destination'


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2b3 Were p!a&es o" origin and destination are &onne&ted by rai! b-t te 1o-rney is per"ormed by any otermode ten Se&ond AC &!ass "are by sortest ro-te to te p!a&e o" destination'

2&3 Were p!a&e o" origin o" 1o-rney and destination. or part tereo". are not &onne&ted by rai! and 1o-rneyis per"ormed by any oter transport ten

2i3 I" a re&ognised p-b!i& transport system e;ists bet#een s-& p!a&es te "irst &!ass or de!-;e &!ass "are o"s-& transport by sortest ro-te. or.

2ii3 I" in oter &ase. Se&ond AC &!ass "are "or te distan&e o" te 1o-rney by te sortest ro-te. as i" te1o-rney as been per"ormed by rai!'

E;emption #i!!. in no &ase e;&eed a&t-a! e;pendit-re in&-rred in te per"orman&e o" 1o-rney'

9ea%e Tra%e! Con&ession (-!es a%e been amended on te re&ommendation o" te Fi"t Pay Commissionto e;tend te "a&i!ity o" tra%e! by air e&onomy Y> C!ass to &ertain &ategories o" emp!oyees o" te Centra!Go%ernment #it e""e&t "rom )st O&tober. )D'

Conse&onditioned Se&ond C!ass (ai! "are. it as been -pgradedto air>&onditioned First C!ass (ai! "are' !'T' 2First Amendment3 (-!es ). O'O'I' Gaette Noti"i&ationNo' S'O' @+2E3 dt'

)=t 7an' ) C04TF'No' )+=/,/D>TP9 No' )*,*=)'

WI99 TBIS CBANGE APP9Y ON9Y TO GO8E(NMENT EMP9OYEES O( 4OES IT APP9Y A9SOTO EMP9OYEES OF OTBE( SECTO(S U

Te &ange app!ies to a!! emp!oyees'

BOW MANY TIMES CAN EQEMPTION 0E C9AIME4 U

Te assessee &an &!aim e;emption in respe&t o" t#o s-& 1o-rney2s3 in a b!o&$ o" + years' For tis p-rpose.te "irst b!o&$ o" + years #as &a!endar year )>' For a b!o&$ o" + years. te 1o-rney per"ormed in te"irst year "o!!o#ing tat b!o&$ year is a!so e!igib!e "or e;emption' A!so. s-& 1o-rney #i!! not be ta$en intoa&&o-nt "or determining te ta; e;emption "or te s-&&eeding b!o&$'

TO HJA9IFY FO( EQEMPTION IS IT NECESSA(Y TO PE(FO(M ACTJA9 7OJ(NEY U

Yes. &ertainty' In &ase te 9'T'C' is en&ased #ito-t a&t-a!!y per"orming te 1o-rney te entire amo-ntre&ei%ed by te emp!oyee #o-!d be ta;ed in is ands'

WBAT IS TBE 4EFINITION OF FAMI9Y FO( TBIS PJ(POSEU

For tis p-rpose K"ami!yK means:>

2i3 Te spo-se and &i!dren o" te indi%id-a! and


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2ii3 Te parents. broters and sisters o" te indi%id-a! or any o" tem. #o!!y or main!y dependent on teindi%id-a!'

Con%eyan&e a!!o#an&e : It is e;empted "rom Ta; i" it doesnLt e;&eed (s ** per mont %i (s ** p'a'0asi&2V +* o" CTC3X =****B(A2V,* o" 0asi&3X)****Con%' A!!o#X**2ta; e;empt -pto **pa3Medi&a! A!!o#X)=,*2IT E;empt -pto ),*** pa3Spe&ia! A!!o#X,***Ci!dren Ed-&ation A!!o#X=**2Ma;im =+**pa 2= &i!dren3 ta; e;empt s-b1e&ted to S&oo!/&o!!edge going&i!dren3PFXD*D*X),*'Be!per A!!o#X=***-ni"orm a!!o#X @***9TAX)*2ta; e;empt t#i&e in a b!o&$ o" + yrs 3T+e Ne9 &tan$a$ in ;Emp#o'ee In"enti8e; &*8e's:

A Case &t*$' o! -& ' . -& +as "ommissione$

Ogani%ationa# C#imate &*8e's !o se8ea# 'eas as pat o! its )*a#it' an$ e?"e##en"e pogams. T+e

"ompan';s 2LL s*8e' meas*e$ 2 $i!!eent moneta' an$ non0moneta' in"enti8es on t+e $egee

to 9+i"+ t+e' 9o*#$ stim*#ate s+ot0tem 8es*s #ong0tem pesona# satis!a"tion in emp#o'ees. O8e

2LL emp#o'ees 0 spanning 1 o!!i"es 9o#$9i$e 0 pati"ipate$ in t+e st*$'. Emp#o'ee In"enti8e

&*8e's seem to 'ie#$ "onsistent#' impessi8e esponse ates $*e to t+e e#e8ant s*@e"t matte. Fo

instan"e t+e -& st*$' +a$ a 56K esponse ate "ompae$ to t+e 2LK ate t+at is stan$a$ !omost )*estionnaie esea"+. It is a#so note9ot+' t+at t+e -& espon$ents 9ee not o!!ee$ an'

e9a$ to en"o*age t+ei pati"ipation.

Unpe"e$ente$ Insig+ts

Ana#'ses e8ea#e$ t+at t+e -& emp#o'ees; appaisa# o! a## 2 potentia# in"enti8es "o*#$ e t+o*g+t

o! as !oming a sing#e mat+emati"a# +iea"+'. In ot+e 9o$s t+e 2 emp#o'ee in"enti8es "o*#$ e

o$ee$ s*"+ t+at in"enti8es to9a$s t+e top pat o! t+e #ist epesente$ +ig+#' ate$ in"enti8es

in"enti8es to9a$s t+e mi$$#e o! t+e #ist 9ee ate$ as me$io"e an$ t+ose nea t+e ottom o! t+e #ist
http://www.hvs.com/http://www.hvs.com/


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9ee gi8en e#ati8e#' #o9 atings. Moeo8e t+is +iea"+' +as t+e $esia#e popet' t+at en$osing

t+e +ig+e in"enti8es imp#ies t+at emp#o'ees a#ea$' a#so en$ose t+e #o9e ones. T+ee!oe in

pa"ti"e Managing Die"tos s+o*#$ !ist "onsi$e t+e emp#o'ee in"enti8e at t+e S1 position in t+e

+iea"+' ne?t at t+e S2 an$ so !ot+ =NOTE: t+e !*## +iea"+' is not pesente$ in t+is ati"#e>. T+is

same +iea"+' a#so imp#ies t+at t+e in"enti8e at t+e S6L position on t+e +iea"+' =e.g. ;O8enig+t

tip 9it+ o!!i"emates;> is genea##' not as e!!e"ti8e as t+e in"enti8e at t+e S2L spot =e.g. ;-o#i$a' pat'

9+ee signi!i"ant ot+es !ami#' ae in8ite$;>. &o e8en t+o*g+ in"enti8e S6L mig+t "ost moe mone'

it is not pe"ei8e$ ' emp#o'ees as meaning!*# as a #ess "ost#' a#tenati8e.

T+is aises t+e iss*e o! moneta' 8es*s non0moneta' in"enti8es. T+e -& st*$' e8ea#e$ t+at non0

moneta' in"enti8es 9ee o!ten ate$ as +ig+ as o +ig+e t+an moneta' in"enti8es. T+is is entie#'

"onsistent 9it+ t+e i$ea t+at 0 esi$es !ai "ompensation 0 emp#o'ees emain 9it+ ogani%ations t+at

"onsistent#' po8i$e !ee#ings o! e#onging appe"iation an$ 9ot+ !o emp#o'ees. T+e !in$ing o! a

sing#e mat+emati"a# +iea"+' !o emp#o'ee in"enti8es a##o9s -& Managing Die"tos to ma(e

in!ome$ e8i$en"e0ase$ "+oi"es 9+en it "omes to imp#ementing emp#o'ee in"enti8e pogams.

F*t+emoe ana#'ses e8ea#e$ t+at t+e atings o! some in"enti8es 9ee iase$ to9a$s eing #ong0

tem moti8atos. T+*s Managing Die"tos "an ma(e e8en moe tagete$ "+oi"es !o in"enti8es

ase$ on a pati"*#a agen$a 0 ;Does t+is o!!i"e 9ant to moti8ate emp#o'ees moe !o t+e s+ot0tem

o moe !o t+e #ong0tem; &+ot0tem moti8atos mig+t app#' to asso"iate$ 9+o ae not e?pe"te$ to

emain 9it+ t+e o!!i"e moe t+an 103 'eas 9+eeas #ong0tem moti8atos mig+t app#' to s*ppot

sta!! an$ ot+e emp#o'ees 9it+ 9+om 'o* 9ant to esta#is+ an$ n*t*e a #asting emp#o'mente#ations+ip.

Be#o9 ae s+o9n epesentati8e items !om t+e mat+emati"a# +iea"+ies !o s+ot0tem moti8atos

8es*s #ong0tem moti8atos at -&. /enea##' spea(ing moneta'0ase$ in"enti8es seeme$ moe

+ig+#' 8a#*e$ as s+ot0tem moti8atos 9+eeas emp#o'ees pe"ei8e$ in"enti8es "on"ening

e"ognition an$ appe"iation as moe #ong0tem moti8atos. Again in"enti8es to9a$s t+e top pat o!

t+ese #ists ae in"enti8es !o 9+i"+ emp#o'ees ga8e e#ati8e#' +ig+ atings in"enti8es to9a$s t+e

mi$$#e o! t+e #ist 9ee ate$ as me$io"e an$ in"enti8es to9a$s t+e ottom pat o! t+e #ist 9ee

gi8en e#ati8e#' #o9 atings. T+ee!oe t+e *#e0o!0t+*m !o -& is to "onsi$e *sing t+ese

in"enti8es in o$e !om top to ottom 0 ta(ing into a""o*nt t+e o!!i"e;s eso*"es an$ in"ome. T+at

is Managing Die"tos s+o*#$ !ist "onsi$e t+e emp#o'ee in"enti8e at t+e S1 position ne?t at t+e S2

an$ so !ot+.

Mat+emati"a# -iea"+' o! &+ot0Tem Moti8ation In"enti8es

1. Reim*sement !o "ontin*ing e$*"ation "o*se9o(.

2. En"o*age team0*i#$ing 9it+ !ee "ompan' s+its o @a"(ets.

3. ,o( +ig+0po!i#e @os $esia#e #o"ations.

4. O8enig+t tip 9it+ o!!i"e mates an$ signi!i"ant ot+es.

5. Peio$i" s*pises !o a @o 9e## $one.

6. Time o!! to pati"ipate in "omm*nit'0se8i"e.

. /i!t o e8ent to e"ogni%e emp#o'ment anni8esa'.

J. ea# o 9itten e"ognition o! emp#o'ment anni8esa'.

. Re"ogni%ing 'o* $epatment o $i8ision !o a @o 9e## $one.

1L. Comment "a$ sent to "#ients a!te "omp#eting an assignment.

Mat+emati"a# -iea"+' o! ong0Tem Moti8ation In"enti8es

1. Pee e8a#*ations.

2. P+oto 9it+in o!!i"e to e"ogni%e emp#o'ee o! t+e mont+.

3. *ate#' so"ia# o*tings at a #o"a# esta*ant a.

4. /i!t !o eing a9a$e$ emp#o'ee o! t+e mont+.

5. ea# !ee$a"( !om s*pe8iso !o a @o 9e## $one.

6. Cas*a# $ess "o$e on Fi$a'.

. O!!i"e message sent to e"ogni%e emp#o'ment anni8esa'.


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J. Aea to $isp#a' pesona# p+otos an$ in!omation.

. Compan'0s*si$i%e$ "+i#$0"ae.

1L. O*t o! o!!i"e e8ents e.g. atten$ing a spoting e8ent.

A Uni)*e Competiti8e A$8antage

T+e impotan"e o! some emp#o'ee in"enti8es e#ati8e to ot+e in"enti8es in t+ese Ta#es mig+t seem

"o*nteint*iti8e o ;9ong.; -o9e8e (eep in min$ t+ese +iea"+ies ae $ata0$i8en 0 t+e' e!#e"t

t+e atings =an$ +en"e 8a#*e s'stems an$ min$sets> o! -& emp#o'ees at+e t+an -&

management. T+*s 9+at management $eems moti8ating ma' not a#9a's e 9+at sta!! memes !in$

moti8ating. An$ sin"e t+e in"enti8e +iea"+ies $i!!e some9+at a"oss $epatments it s+o*#$ not e

s*pising to !in$ 8aiations et9een "ompanies as 9e##. T+is is 9+' Emp#o'ee In"enti8e &*8e's

o!!e 8a#*a#e insig+ts an$ 9+' o@e"ti8e ana#'sis o! )*antitati8e $ata is pe!ee$ o8e opinions an$

s*ppositions !om management an$ "ons*#tants.

-&; emp#o'ee in"enti8e s*8e' "ost e#ati8e#' #itt#e to "on$*"t in tems o! time an$ mone' *t it

po$*"e$ !in$ings t+at se8e$ as a e#ia#e an$ soeing in$i"ato o! t+e 8a#*e s'stem o! its

9o#$9i$e emp#o'ees. T+is gi8es -& a signi!i"ant "ompetiti8e a$8antage in atta"ting an$ (eeping

its top ta#ent in an in$*st' #a$en 9it+ +ig+ emp#o'ee t*no8e. O! "o*se t+e spe"i!i" !in$ings ao*t

t+e e!!e"ti8eness o! "etain in"enti8es at -& st*$' ae not meant to genea#i%e to ot+e "ompanies.

T+e e?amp#e pesente$ +ee ae i##*stations o! t+e t'pe o! o*t"omes t+at ogani%ations "an e?pe"t!om s*"+ s*8e's. T+e IRT met+o$o#ogies *se$ in t+e -& Emp#o'ee In"enti8e &*8e' set a ne9

stan$a$ in t+e in$*st' an$ "an e e!!i"ient#' $*p#i"ate$ !o ot+e *sinesses an$ !o ot+e

in$*sties. To t+at en$ some +e#p!*# g*i$e#ines ae s*ggeste$:

a> Cae!*##' i$enti!' in"enti8es to e ate$ ' emp#o'ees 8ia a pane# e8ie9 i.e. in8ite -*man

Reso*"es po!essiona#s senio management an$ $epatment +ea$s to assist in "eating t+e #ist o!

in"enti8es to e e8a#*ate$.

> Con$*"t t+e s*8e' on#ine to ma?imi%e e!!i"ien"' an$ a""*a"' o! t+e $ata "o##e"tion.

"> Use a t+i$ pat' !o t+e st*$' to emp+asi%e t+e impatia#it' an$ anon'mit' o! t+e s*8e' to

emp#o'ees.

$> I! nee$e$ "eate $i!!eent se"tions o! t+e s*8e' to $i!!eentiate =1> in"enti8es 'o* "ompan' no9

*ses 8es*s =2> in"enti8es t+e "ompan' is "ontemp#ating !o t+e !*t*e.

e> Ma(e it "#ea to emp#o'ees at t+e stat t+at t+e in"enti8e s*8e' mee#' aims to "o##e"t in!omation

!o "onsi$eationG it is not ne"essai#' a pomise to imp#ement ne9 in"enti8es in t+e s+ot0 o #ong0

tems.

!> ,+ee8e possi#e segment $i8isions o $epatments in ana#'ses as oppose$ to aggegating es*#ts

a"oss t+e entie ogani%ation. T+ee mig+t e an o8ea"+ing "ompan' "*#t*e *t $i8isions o

$epatments "an +a8e sma## *t signi!i"ant $e8iations !om t+e *me##a "*#t*e t+at "an impa"t

in"enti8e atings.


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SA9A(Y AN4 WAGE MANAGEMENTIn tis arti&!e #e are dis&-ssing te #ays and means o" "i;ing te &ompensations !e%e!sta$ing into &onsideration %ario-s "a&tors !i$e e;perien&e. identi&a! ind-stry $no#!edge.


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@'Wage and Sa!ary Ad1-stments:O%era!! sa!ary grades o" te organiation may be ad1-sted based on te data andin"ormation &o!!e&ted abo-t te sa!ary !e%e!s o" simi!ar organiations' Indi%id-a! sa!ary!e%e! may a!so be ad1-sted based on te per"orman&e o" te indi%id-a! emp!oyees'Pin"ip#es o! ,age an$ &a#a' A$ministation

Tere are se%era! prin&ip!es o" #age and sa!ary p!ans. po!i&ies and pra&ti&es' Teimportant among tem are:2a3Wage and sa!ary p!ans and po!i&ies so-!d be s-""i&ient!y "!e;ib!e'2b37ob e%a!-ation m-st be done s&ienti"i&a!!y'2&3Wage and sa!ary administration p!ans m-st a!#ays be &onsistent #it o%era!!organiationa! p!ans and programs'2d3Wage and sa!ary administration p!ans and programs so-!d be in &on"ormity #it teso&ia! and e&onomi& ob1e&ti%es o" te &o-ntry !i$e attainment o" e


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9EGIS9ATIONS (EGA(4ING COMPENSATION

)))> WO(E(S COMPENSATION:)' to pro%ide s-re. prompt and reasonab!e in&ome and medi&a! bene"its to #or$>a&&ident %i&tims. or in&omebene"its to teir dependents. regard!ess o" "a-!t=' to pro%ide a sing!e remedy and red-&e &o-rt de!ays. &osts and #or$!oads arising o-t o" persona! in1-ry

!itigation@' to re!ie%e p-b!i& and pri%ate &arities o" "inan&ia! drains in&ident to -n&ompensated ind-stria! a&&idents

+' to e!iminate payment o" "ees to !a#yers and #itnesses as #e!! as time&ons-ming tria!s andappea!s,' to en&o-rage ma;im-m emp!oyer interest in sa"ety and reabi!itation tro-g appropriatee;perien&e>rating me&anisms' to promote "ran$ st-dy o" &a-ses o" a&&idents

SOCIA9 SECJ(ITY ACT )@,Tis a&t #as estab!ised to pro%ide Ameri&an Wor$ers #it prote&tion "rom tota! e&onomi&destit-tion in te e%ent o" termination o" emp!oyment beyond tis &ontro!' Emp!oyers andemp!oyees &ontrib-te eemp!oyed

persons m-st pay o-t o" teir o#n po&$ets ann estab!ised amo-nt to gain so&ia! se&-rityprote&tion' A!to-g so&ia! se&-rity is basi&a!!y a retirement program. it a!so estab!ised teFedera! o!d>age. s-r%i%ors. disabi!ity and ea!t ins-ran&e system' 0y )D so&ia! se&-rity&o%ered more tan * mi!!ion #or$ers and teir dependents' In addition. te origina! !a#estab!ised te "edera! and state emp!oyment &ompensation system'

WE9FA(E AN4 PENSION P9AN 4ISC9OSJ(E ACT ),We!"are p!ans are tose pro%iding medi&a!. s-rgery or ospita! bene"its or &are. and bene"its in tee%ent o" si&$ness. a&&ident. disabi!ity. deat or -nemp!oyment'

TBE BEA9TB MAINTENANCE O(GANIZATION ACT )D@BMOs are ea!t&are organiations tat pro%ide medi&a! &are at a "i;ed mont!y "ee'

)D T(A4E ACT:Te trade a&t #as passed to assist emp!oyers and emp!oyees #o a%e been -rt by "oreign&ompetition'

)D+ EMP9OYEE (ETI(EMENT INCOME SECJ(ITY ACT:To prote&t pension p!ans "rom "ai!-res and obso!ete ass-mptions. !eading po!iti&ian "ig-res andgo%ernment o""i&ia!s introd-&ed se%era! proposa!s "or re"orming pri%ate pension p!ans'

)* MJ9TIEMP9OYE( FJNCTION P9AN AMEN4MENT ACT:Genera!!y. m-!tiemp!oyer pension p!ans are estab!ised and maintained tro-g &o!!e&ti%ebargaining bet#een emp!oyee representati%es and more tan on emp!oyer'

)+ (ETI(EMENT EHJITY ACT:Tis a&t #as designed to e!iminate dis&rimination in pensions pro%ided to #omen'

) WO(E( A47JSTMENT AN4 (ETAINING NOTIFICATION ACT:Tis a&t re


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) Bea!t Ins-ran&e Portabi!ity And A&&o-ntabi!ity A&t:)' Wor$ers #o &ange 1obs #i!! be e!igib!e "or ins-ran&e &o%erage in te ne# 1ob'=' Wor$ers &an not be denied &o%erage by teir emp!oyer?s ins-rer "or more tan ) year

be&a-se o" a pree;isting ea!t &ondition'@' Indi%id-a!s #o a%e been &o%ered in a gro-p p!an "or at !east ) monts #i!! a%e

a&&ess to indi%id-a! ins-ran&e &o%erage'

CI8I9 (IGBTS ACT OF )+proibits pri%ate emp!oyers. state and !o&a! go%ernments. and ed-&ation instit-tions. and&ompanies #it ), or more emp!oyees "rom dis&riminating against teir emp!oyees and 1obapp!i&ants on te basis o" ra&e. re!igion. &o!or. se; and nationa! origin' Te Federa! go%ernment.pri%ate and p-b!i& emp!oyment agen&ies. and !abor organiations. a!so m-st abide by te !a#'Most dis&rimination !a#s-its a!!ege a %io!ation o" tis !a#' Tis !a# is en"or&ed by a "edera!agen&y. te Eemp!oyment rigts and remont period' Federa! &ontra&tors #it ,* or more emp!oyees and at !east one &o%ered&ontra&t "or ,*.*** or more are a!so re


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K%erba! or pysi&a! &ond-&t #i& res-!ts in a osti!e or intimidating #or$ en%ironment tatinter"eres #it #or$ per"orman&e or oter#ise ad%erse!y a""e&ts emp!oyment opport-nities'KE;amp!es o" arassment may in&!-de 1o$es. name &a!!ing. derogatory &omments. and o""ensi%epi&t-res' Te !a# states tat i" te &ompany $ne#. &o-!d a%e $no#n. or so-!d a%e $no#n o"te arassment. and i" te arassment -nreasonab!y inter"ered #it te indi%id-a!Ls #or$per"orman&e or &reated an intimidating. osti!e or o""ensi%e #or$ en%ironment. ten te &ompany

is !iab!e'STATE EHJA9 EMP9OYMENT 9AWS typi&a!!y pro%ide te same anti>dis&riminationprote&tions as "edera! !a#s. p!-s some additiona!' For e;amp!e in te state o" Ca!i"ornia. it isi!!ega! to dis&riminate in emp!oyment on te basis o" marita! stat-s and se;-a! orientation'

9AWS AFFECTING 0ENEFITS AN4 PAYTBE EMP9OYEE (ETI(EMENT AN4 INCOME SECJ(ITY ACT o" )D+ 2E(ISA3 go%erns


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TBE IMMIG(ATION (EFO(M AN4 CONT(O9 ACT 2I(CA3 is intended to e!iminate teemp!oyment o" Ki!!ega! a!iens'K A!! ne# emp!oyees are re


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teir management as a gro-p 2or one emp!oyee spea$ing on bea!" o" a gro-p o" emp!oyees3. todis&-ss pay. o-rs o" #or$. or #or$ing &onditions. is prote&ted' No ad%erse a&tion 2e'g' dis&arge.demotion. or p-niti%e meas-res3 &an be ta$en against te emp!oyee2s3 "or raising s-& an iss-e'WO(E(S COMPENSATION pro%ides bene"its to emp!oyees in1-red on te 1ob. in&!-dingmedi&a! bene"its. disabi!ity bene"its "or !ost #ages 2typi&a!!y t#o tirds o" #ages -p to a spe&i"i&!imit > D= per #ee$ in Ca!i"ornia3. deat bene"its "or dependents. and in some &ir&-mstan&es.

1ob retraining ne&essitated by te #or$ re!ated in1-ry' Wor$ers &ompensation premi-ms are paidby te emp!oyer' Te amo-nt o" te premi-m depends on te mi; o" positions e!d by teemp!oyees 2e'g' administrati%e. man-"a&t-ring. "ie!d ser%i&e. et&'3' 0ot te emp!oyee andemp!oyer m-st prompt!y report in1-ries by &omp!eting and s-bmitting a Wor$ers Compensation"orm' In"ormation on reporting #or$ re!ated in1-ries or i!!nesses m-st be posted on &ompanyb-!!etin boards'

AFFI(MATI8E ACTION:7ob &!assi"i&ations identi"ied "or a""irmati%e a&tion are:2)3 o""i&ia!s and administrators2=3 pro"essiona!s

2@3 te&ni&ians2+3 prote&ti%e ser%i&e #or$ers2,3 para>pro"essiona!s23 o""i&e and &!eri&a! #or$ers2D3 s$i!!ed &ra"t #or$ers. and23 ser%i&e and maintenan&e #or$ers'

)+= Wage stabi!iation A&t:Te go%ernment estab!ised 5going rates6 "or $ey o&&-pations and ten permitted pay in&reases-p to te minim-m o" te 5going rate6 bra&$et' 0ene"its &o-!d be instit-ted on!y i" emp!oyers&o-!d so# tat tey #ere &-stomary in area'

),* de"ense Prod-&tion A&t:Wage in&reases #ere restri&ted d-ring te orean &on"!i&t'

TBE PAYMENT OF WAGES ACT. )@Tis is one o" te ear!ier 9abo-r 9a#s passed d-ring 0ritis (-!e and &ame into "or&e on =tMar& )@D'

Ob1e&ti%e: To reg-!ate payment o" #ages to persons emp!oyed dire&t!y or indire&t!y in Ind-stry'Spe&i"i&a!!y. it app!ies to emp!oyees dra#ing a #age o" -pto (s' )**/> on an a%erage per montand emp!oyed in 2)3 Fa&tories. 2=3 Transport Ser%i&e o" a!! $inds. 2@3 Mines. 2+3 P!antations and2,3 Constr-&tion ind-stry' Te &entra! and state Go%ernments are empo#ered to bring any oter

ind-stry or estab!isment -nder &o%erage a"ter gi%ing @ monts noti&e o" teir intention to do so'

A-tority: Te State Go%ernment. e;&ept in te &ase o" &entra! Go%ernment' -nderta$ings spreadin more tan one State' Bo#e%er. (-!e ma$ing po#ers are %ested in te State Go%ernment' Ea&State Go%ernment #i!! a%e itso#n (-!es'

Wages: L #ages L &o%er a!! payments made to an emp!oyee in&!-ding a!! a!!o#an&es or tose in$ind &apab!e o" being e;pressed in terms o" money b-t does not in&!-de. 2a3 0on-s. 2b3 Bo-se


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(ent. 2&3 &ontrib-tion to Pro%ident F-nd or Pension F-nd o" te emp!oyee. 2d3 Tra%e!!inga!!o#an&e. 2e3 Grat-ity and 2"3 Spe&ia! e;penses' Wages &an be paid by &eoperati%e so&ieties. 2$3 9i"e Ins-ran&e Corpn' po!i&y premi-m. 2I3 p-r&ase o" Go%ernmentse&-rities. 2m3 "ide!ity g-arantee bonds ins-ran&e premi-m' 2n3 Contrib-tion to Prime MinisterLsNationa! (e!ie" F-nd or oter F-nds spe&i"ied. noti"ied by Centra! Go%ernment' 2*3 &ontrib-tionto -nion "-nd'

Tota! amo-nt O" ded-&tions not to e;&eed Se%enty Fi%e per &ent o" #ages #ere ded-&tions aremade "or payments to &o>operati%e so&ieties and not to e;&eed Fi"ty per &ent in oter &ases'

4ed-&tion "or !oss: Te ded-&tion sa!! not e;&eed a&t-a! amo-nt o" !oss or damage' Bo#e%er. it&an be made on!y a"ter te emp!oyed person as been gi%en an opport-nity o" so#ing &a-seagainst ded-&tion'

4ed-&tion "or ser%i&e rendered: In te &ase o" o-se a&&ommodation or oter amenities. tea&&ommodation or amenities m-st a%e been a&&epted by te emp!oyee'

Co>operati%e So&ieties and Ins-ran&e S&emes: 4ed-&tions #i!! be s-b1e&t to te (-!es made byte State Go%ernment'

Pro&ed-re: C!aims arising o-t o" #rong"-! ded-&tions or de!ay in payments are to be made to te

appropriate 9abo-r Co-rt or Trib-na! a-torised by te State Go%ernment' Norma!!y. tere is aspe&ia! &o-rt designated as te A-tority Jnder Payment o" Wages A&tL' Te &!aim m-st be madein appropriate "orm and a&&ording to te pro&ed-re !aid do#n in te (-!es "ramed by te StateGo%ernments'

Appea!: Appea! against te order o" te A-tority &an be "i!ed be"ore te Co-rt o" Sma!! Ca-sesor a 4istri&t Co-rt'


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4isp!ay: Abstra&ts o" te A&t and te r-!es m-st be disp!ayed by te emp!oyer in Eng!is or a!ang-age -nderstood by ma1ority o" te emp!oyees in te "a&tory or estab!isment premises'

MINIMJM WAGES ACT )+:

(IGBT OF WO(E(S. ETC' te ob!igation o" te emp!oyers. pra&ti&a!!y spea$ing te rigt o"emp!oyees

E%ery #or$er sa!! a%e te rigt to

2i3 obtain "rom te o&&-pier. in"ormation re!ating to #or$ersL ea!t and sa"ety at #or$

2ii3 get trained #itin te "a&tory #ere%er possib!e. or. to get imse!" sponsored by te o&&-pier"or getting trained at a training &entre or instit-te. d-!y appro%ed by te Cie" Inspe&tor. #eretraining is imparted "or #or$ersL ea!t and sa"ety at #or$

2iii3 (epresent to te Inspe&tor dire&t!y or tro-g is representati%e in te matter o" inade


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2=3 Wito-t pre1-di&e to te genera!ity o" s-b>se&tion 2)3. tere sa!! be in e%ery #or$room o" a"a&tory in e;isten&e on te date o" te &ommen&ement o" tis A&t at !east ' &-bi& metres and o"a "a&tory b-i!t a"ter te &ommen&ement o" tis A&t at !east )+'= &-bi& metres or spa&e "or e%ery#or$er emp!oyed terein. and "or te p-rposes o" tis s-b>se&tion no a&&o-nt sa!! be ta$en o"any spa&e #i& is more tan +'= metres abo%e te !e%e! o" te "!oor o" te room'

2@3 I" te Cie" Inspe&tor by order in #riting so re

2a3 Te 4ire&tor Genera!. Bea!t Ser%i&es. e; o""i&io. as Cairman

2b3 A 4ep-ty 4ire&tor>Genera!. Bea!t Ser%i&es. to be appointed by te Centra! Go%ernment

2&3 Te Medi&a! Commissioner o" te Corporation. e; o""i&io.

2d3 One member ea& representing ea& o" te States 2oter tan Jnion territories3 in #i& tisA&t is in "or&e to be appointed by te State Go%ernment &on&erned

2e3 Tree members representing emp!oyers to be appointed by te Centra! Go%ernment in&ons-!tation #it s-& organiations o" emp!oyers as may be re&ognied "or te p-rpose by teCentra! Go%ernment

2"3 tree members representing emp!oyees to be appointed by te Centra! Go%ernment in&ons-!tation #it s-& organiations o" emp!oyees as may be re&ognied "or te p-rpose by teCentra! Go%ernment and

2g3 Tree members. o" #om not !ess tan one sa!! be a #oman. representing te medi&a!pro"ession. to be appointed by te Centra! Go%ernment in &ons-!tation #it s-& organiations o"medi&a! pra&titioners as may be re&ognied "or te p-rpose by te Centra! Go%ernment'

2=3 Sa%e as oter#ise e;press!y pro%ided in tis A&t. te term o" o""i&e o" a member o" teMedi&a! 0ene"it Co-n&i!. oter tan a member re"erred to in any o" te &!a-se 2a3 to 2d3 o" s-b>se&tion 2)3. sa!! be "o-r years "rom te date on #i& is appointment is noti"ied: Pro%ided tata member o" te Medi&a! 0ene"it Co-n&i! sa!!. not#itstanding te e;piry o" te said period o"L"o-r years &ontin-e to o!d o""i&e -nti! te appointment o" is s-&&essor is noti"ied'

2@3 A member o" te Medi&a! 0ene"it Co-n&i! re"erred to in &!a-ses 2b3 and 2d3 o" s-b>se&tion 2)3sa!! o!d o""i&e d-ring te p!eas-re o" te Go%ernment appointing im'


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e3 Important "eat-res o" te minim-m #ages a&t )+

An A&t to pro%ide "or "i;ing minim-m rates o" #ages in &ertain emp!oyments'

WBE(EAS it is e;pedient to pro%ide "or "i;ing minim-m rates o" #ages in &ertain emp!oyments

An A&t to pro%ide "or &ertain bene"its to emp!oyees in &ase o" si&$ness. maternity andKemp!oyment in1-ryK and to ma$e pro%ision "or &ertain oter matters in re!ation tereto

WBE(EAS it is e;pedient to pro%ide "or &ertain bene"its to emp!oyees in &ase o" si&$ness.maternity and emp!oyment in1-ry and to ma$e pro%ision "or &ertain oter matters in re!ationtereto

Te a&t !ays do#n "or "i;ation o".

)3 A minim-m time rate o" #ages

=3 A minim-m pie&e rate

@3 A g-aranteed time rate and

+3 An o%ertime rate

For di""erent o&&-pation. !o&a!ities or &!asses o" #or$ and "or ad-!ts. ado!es&ents. &i!dren andapprenti&es'

=3 Te minim-m rate o" #ages may &onsist o":

)3 a basi& rate o" #ages and a &ost o" !i%ing a!!o#an&e or

=3 A basi& arte o" #ages #it or #ito-t te &ost o" !i%ing a!!o#an&e and te &as %a!-e o" te&on&essions in respe&t o" essentia! &ommodities s-pp!ied at &on&essiona! rates'

@3 Te a&t !ays do#n tat #ages sa!! be paid in &as a!to-g it empo#ers te appropriatego%ernment to a-torie te payment o" minim-m #ages eiter #o!!y or part!y in $ind inparti&-!ar &ases'

+3 It pro%ides tat te &ost o" !i%ing a!!o#an&e and &as %a!-e o" te &on&essions in respe&t o"s-pp!ies o" essentia! &ommodities at &on&essiona! rates sa!! be &omp-ted by &omponenta-tority at &ertain inter%a!'

,3 Te a&t empo#ers te appropriate go%ernment to "i; te n-mber o" o-rs o" #or$ per day. to

pro%ide "or a #ee$!y o!iday and te payment o" o%ertime #ages o" #i& minim-m rates o"#ages a%e been "i;ed -nder te a&t'

3 Te a&t !ays do#n "or appointment o" inspe&tors and oter a-torities to ear and de&ide&!aims arising o-t o" payment o" #ages at !ess tan te minim-m rates o" #ages or rem-neration"or days o" rest o" #or$ done on s-& days or o" o%ertime #ages

D3 A!! estab!isments &o%ered by te a&t are re


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3 Te a&t pro%ides te pro&ed-re "or dea!ing #it &omp!aints arising o-t o" te %io!ation o" tepro%isions o" te a&t and "or imposing pena!ties "or o""en&es -nder te a&t'

2g3 E!igibi!ity and determination o" bon-s

E%ery emp!oyee sa!! be entit!ed to be paid by is emp!oyer in an a&&o-nting year. bon-s. ina&&ordan&e #it te pro%isions o" tis A&t. pro%ided e as #or$ed in te estab!isment "or not!ess tan tirty #or$ing days in tat year' Were an emp!oyee as not #or$ed "or a!! te #or$ingdays in an a&&o-nting year. te minim-m bon-s o" one -ndred r-pees or. as te &ase may be. o"si;ty r-pees. i" s-& bon-s is iger tan '@@ per &ent o" is sa!ary or #age "or te days e as#or$ed in tat a&&o-nting year. sa!! be proportionate!y red-&ed' 0on-s -nder te payment o"bon-s a&t &annot be &!aimed by #or$ers as a matter o" rigt' Te bon-s "orm-!a -nder te a&t reston &a!&-!ation o" te a%ai!ab!e s-rp!-s and it en%isages te "o!!o#ing steps Comp-tation o"a%ai!ab!e s-rp!-s' Te a%ai!ab!e s-rp!-s in respe&t o" any a&&o-nting year sa!! be te grosspro"its "or tat year a"ter ded-&ting tere "rom te s-ms re"erred to in se&tion : Pro%ided tat te

a%ai!ab!e s-rp!-s in respe&t o" te a&&o-nting year &ommen&ing on any day in te year ) andin respe&t o" e%ery s-bse

2a3 any amo-nt by #ay o" depre&iation admissib!e in a&&ordan&e #it te pro%isions o" s-b>se&tion 2)3 o" se&tion @= o" te In&ome>ta; A&t. or in a&&ordan&e #it te pro%isions o" teAgri&-!t-ra! In&ome>ta; 9a#. as te &ase may be: Pro%ided tat #ere an emp!oyer as beenpaying bon-s to is emp!oyees -nder a sett!ement or an a#ard or agreement made be"ore te =tMay. ),. and s-bsisting on tat date a"ter ded-&ting "rom te gross pro"its notiona! norma!depre&iation. ten. te amo-nt o" depre&iation to be ded-&ted -nder tis &!a-se sa!!. at te optiono" s-& emp!oyer 2s-& option to be e;er&ised on&e and #itin one year "rom tat date3 &ontin-eto be s-& notiona! norma! depre&iation

2b3 Any amo-nt by #ay o" de%e!opment rebate or in%estment a!!o#an&e or de%e!opmenta!!o#an&e #i& te emp!oyer is entit!ed to ded-&t "rom is in&ome -nder te In&ome>ta; A&t

2&3 s-b1e&t to te pro%isions o" se&tion D. any dire&t ta; #i& te emp!oyer is !iab!e to pay "or tea&&o-nting year in respe&t o" is in&ome. pro"its and gains d-ring tat year

2d3 S-& "-rter s-ms as are spe&i"ied in respe&t o" te emp!oyer in te Tird S&ed-!e


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b3 Witdra#a! or &an&e!!ation o" trade -nion: A &erti"i&ate o" registration o" a Trade Jnion maybe #itdra#n o &an&e!!ed by te (egistrar

2)3 On te app!i&ation o" te Trade Jnion to be %eri"ied in s-& manner as may be pres&ribed. or2=3 I" te (egistrar is satis"ied tat te &erti"i&ate as been obtained by "ra-d or mista$e. or tatte Trade Jnion as &eased to e;ist or as #i!!"-!!y and a"ter noti&e "rom te (egistrar

&ontra%ened any pro%ision o" tis A&t or a!!o#ed any r-!e to &ontin-e in "or&e #i& isin&onsistent #it any s-& pro%ision. or as res&inded any r-!e pro%iding "or any matter.pro%ision "or #i& is re)+D

)3 Te appropriate Go%ernment may as o&&asion arises by noti"i&ation in te O""i&ia! Gaette&onstit-te a 0oard o" Con&i!iation "or promoting te sett!ement o" an ind-stria! disp-te'

2=3 A &on&i!iation o""i&er may be appointed "or a spe&i"ied area or "or spe&i"ied ind-stries in aspe&i"ied area or "or one or more spe&i"ied ind-stries and eiter permanent!y or "or a !imitedperiod'

2=3 A 0oard sa!! &onsist o" a Cairman and t#o or "o-r oter members. as te appropriateGo%ernment tin$s "it'

2@3 Te Cairman sa!! be an independent person and te oter members sa!! be persons

appointed in e


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Go%ernment or an o""i&er a-torised in tis bea!" by te appropriate Go%ernment togeter #it amemorand-m o" te sett!ement signed by te parties to te disp-te'

2+3 I" no s-& sett!ement is arri%ed at. te &on&i!iation o""i&er sa!!. as soon as pra&ti&ab!e a"ter te&!ose o" te in%estigation. send to te appropriate Go%ernment a "-!! report setting "ort te stepsta$en by im "or as&ertaining te "a&ts and &ir&-mstan&es re!ating to te disp-te and "or bringing

abo-t a sett!ement tereo". togeter #it a "-!! statement o" s-& "a&ts and &ir&-mstan&es. and tereasons on a&&o-nt o" #i&. in is opinion. a sett!ement &o-!d not be arri%ed at'

2,3 I". on a &onsideration o" te report re"erred to in s-b>se&tion 2+3. te appropriate Go%ernmentis satis"ied tat tere is a &ase "or re"eren&e to a 0oard. 9abo-r Co-rt. Trib-na! or Nationa!Trib-na!. it may ma$e s-& re"eren&e' Were te appropriate Go%ernment does not ma$e s-& are"eren&e it sa!! re&ord and &omm-ni&ate to te parties &on&erned its reasons tere"ore' 4JTIESOF 0OA(4' > 2)3 Were a disp-te as been re"erred to a 0oard -nder tis A&t. it sa!! be ted-ty o" te 0oard to endea%or to bring abo-t a sett!ement o" te same and "or tis p-rpose te0oard sa!!. in s-& manner as it tin$s "it and #ito-t de!ay. in%estigate te disp-te and a!!matters a""e&ting te merits and te rigt sett!ement tereo" and may do a!! s-& tings as it tin$s"it "or te p-rpose o" ind-&ing te parties to &ome to a "air and ami&ab!e sett!ement o" te disp-te'

2=3 I" a sett!ement o" te disp-te or o" any o" te matters in disp-te is arri%ed at in te &o-rse o"te &on&i!iation pro&eedings. te 0oard sa!! send a report tereo" to te appropriate Go%ernmenttogeter #it a memorand-m o" te sett!ement signed by te parties to te disp-te'

2@3 I" no s-& sett!ement is arri%ed at. te 0oard sa!!. as soon as pra&ti&ab!e a"ter te &!ose o" tein%estigation. send to te appropriate Go%ernment a "-!! report setting "ort te pro&eedings andsteps ta$en by te 0oard "or as&ertaining te "a&ts and &ir&-mstan&es re!ating to te disp-te and"or bringing abo-t a sett!ement tereo". togeter #it a "-!! statement o" s-& "a&ts and&ir&-mstan&es. its "indings tereon. te reasons on a&&o-nt o" #i&. in its opinion. a sett!ement&o-!d not be arri%ed at and its re&ommendations "or te determination o" te disp-te'

2+3 I". on te re&eipt o" a report -nder>s-b>se&tion 2@3 in respe&t o" a disp-te re!ating to a p-b!i&-ti!ity ser%i&e. te appropriate Go%ernment does not ma$e a re"eren&e to a 9abo-r Co-rt. Trib-na!or Nationa! Trib-na! -nder se&tion )*. it sa!! re&ord and &omm-ni&ate to te parties &on&ernedits reasons tere"ore'

2,3 Te 0oard sa!! s-bmit its report -nder tis se&tion #itin t#o monts o" te date on #i&te disp-te #as re"erred to it or #itin s-& sorter period as may be "i;ed by te appropriateGo%ernment : Pro%ided tat te appropriate Go%ernment may "rom time to time e;tend te time"or te s-bmission o" te report by s-& "-rter periods not e;&eeding t#o monts in teaggregate : Pro%ided "-rter tat te time "or te s-bmission o" te report may be e;tended bys-& period as may be agreed on in #riting by a!! te parties to te disp-te'

23 A report -nder tis se&tion sa!! be s-bmitted #itin "o-rteen days o" te &ommen&ement o"te &on&i!iation pro&eedings or #itin s-& sorter period as may be "i;ed by te appropriateGo%ernment : Pro%ided tat. S-b1e&t to te appro%a! o" te &on&i!iation o""i&er. te time "or tes-bmission o" te report may be e;tended by s-& period as may be agreed -pon in #riting by a!!te parties to te disp-te' Sett!ements:

2)3 A sett!ement sa!! &ome into operation on s-& date as is agreed -pon by te parties to tedisp-te. and i" no date is agreed -pon. on te date on #i& te memorand-m o" te sett!ement issigned by te parties to te disp-te'


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2=3 S-& sett!ement sa!! be binding "or s-& period as is agreed -pon by te parties. and i" nos-& period is agreed -pon. "or a period o" si; monts "rom te date on #i& te memorand-mo" sett!ement is signed by te parties to te disp-te. and sa!! &ontin-e to be binding on te partiesa"ter te e;piry o" te period a"oresaid. -nti! te e;piry o" t#o monts "rom te date on #i& anoti&e in #riting o" an intention to terminate te sett!ement is gi%en by one o" te parties to te

oter party or parties to te sett!ement'

2@3 An a#ard sa!!. s-b1e&t to te pro%isions o" tis se&tion. remain in operation "or a period o"one year "rom te date on #i& te a#ard be&omes en"or&eab!e -nder se&tion )DA: Pro%ided tatte appropriate Go%ernment may red-&e te said period and "i; s-& period as it tin$s "it :Pro%ided "-rter tat te appropriate Go%ernment may. be"ore te e;piry o" te said period.e;tend te period o" operation by any period not e;&eeding one year at a time as it tin$s "it. soo#e%er. tat te tota! period o" operation o" any a#ard does not e;&eed tree years "rom te dateon #i& it &ame into operation'

2+3 Were te appropriate Go%ernment. #eter o" its o#n motion or on te app!i&ation o" anyparty bo-nd by te a#ard. &onsiders tat sin&e te a#ard #as made. tere as been a materia!

&ange in te &ir&-mstan&es on #i& it #as based. te appropriate Go%ernment may re"er tea#ard or a part o" it to a 9abo-r Co-rt. i" te a#ard #as tat o" a 9abo-r Co-rt or to a Trib-na!. i"te a#ard #as tat o" a Trib-na! or o" a Nationa! Trib-na!. "or de&ision #eter te period o"operation so-!d not. by reason o" s-& &ange. be sortened and te de&ision o" 9abo-r Co-rt orte Trib-na!. as te &ase may be. on s-& re"eren&e sa!! be "ina!'

2,3 Noting &ontained in s-b>se&tion 2@3 sa!! app!y to any a#ard #i& by its nat-re. terms oroter &ir&-mstan&es does not impose. a"ter it as been gi%en e""e&t to. any &ontin-ing ob!igationon te parties bo-nd by te a#ard'

23 Not#itstanding te e;piry o" te period o" operation -nder s-b>se&tion 2@3. te a#ard sa!!&ontin-e to be binding on te parties -nti! a period o" t#o monts as e!apsed "rom te date on

#i& noti&e is gi%en by any party bo-nd by te a#ard to te oter party or parties intimating itsintention to terminate te a#ard'

2D3 No noti&e gi%en -nder s-b>se&tion 2=3 or s-b>se&tion 23 sa!! a%e e""e&t. -n!ess it is gi%en bya party representing te ma1ority o" persons bo-nd by te sett!ement or a#ard. as te &ase may be'

TBE PAYMENT OF 0ONJS ACT. ),An A&t to pro%ide "or te payment o" bon-s to persons emp!oyed in &ertain estab!isments on tebasis o" pro"its or on te basis o" prod-&tion or prod-&ti%ity and "or matters &onne&ted tere#it'

)' a&&o-nting year

=' a!!o&ab!e s-rp!-s@' a%ai!ab!e s-rp!-s+' sa!ary or #age6 means

5a&&o-nting year6 means >2i3 in re!ation to a &orporation. te year ending on te day on #i& te boo$s and a&&o-ntso" te &orporation are to be &!osed and ba!an&ed'


63/67

2ii3 in re!ation to a &ompany. te period in respe&t o" #i& any pro"it and !oss a&&o-nt o" te&ompany !aid be"ore it in ann-a! genera! meeting is made -p. #eter tat period is a year or not

2iii3 in any oter &ase >

2a3 te year &ommen&ing on te )st day o" Apri! or

2b3 i" te a&&o-nts o" an estab!isment maintained by te emp!oyer tereo" are &!osed andba!an&ed on any day oter tan te @)st day o" Mar&. ten. at te option o" te emp!oyer. teyear ending on te day on #i& its a&&o-nts are so &!osed and ba!an&ed:

Pro%ided tat an option on&e e;er&ised by te emp!oyer -nder paragrap 2b3 o" tis s-b>&!a-sesa!! not again be e;er&ised e;&ept #it te pre%io-s permission in #riting o" te pres&ribeda-tority and -pon s-& &onditions as tat a-tority may tin$ "it

a!!o&ab!e s-rp!-s6 means>2a3 in re!ation to an emp!oyer. being a &ompany @2oter tan a ban$ing &ompany3 #i&as not made te arrangements pres&ribed -nder te In&ome>ta; A&t "or te de&!aration and

payment #itin India o" te di%idends payab!e o-t o" its pro"its in a&&ordan&e #it te pro%isionso" se&tion )+ o" tat A&t. si;ty>se%en per &ent o" te a%ai!ab!e s-rp!-s in an a&&o-nting year2b3 in any oter &ase. si;ty per&ent o" s-& a%ai!ab!e s-rp!-s

a%ai!ab!e s-rp!-s6 means te a%ai!ab!e s-rp!-s &omp-ted -nder se&tion ,

sa!ary or #age6 means a!! rem-neration 2oter tan rem-neration in respe&t o" o%er>time #or$3&apab!e o" being e;pressed in terms o" money. #i& #o-!d. i" te terms o" emp!oyment. e;pressor imp!ied. #ere "-!"i!!ed. be payab!e to an emp!oyee in respe&t o" is emp!oyment or o" #or$done in s-& emp!oyment and in&!-des dearness a!!o#an&e 2tat is to say. a!! &as payments. by#ate%er name &a!!ed. paid to an emp!oyee on a&&o-nt o" a rise in te &ost o" !i%ing3. b-t does not

in&!-de>2i3 any oter a!!o#an&e #i& te emp!oyee is "or te time being entit!ed to2ii3 te %a!-e o" any o-se a&&ommodation or s-pp!y o" !igt. #ater. medi&a! attendan&e oroter amenity or o" any ser%i&e or o" any &on&essiona! s-pp!y o" "ood grains or oter arti&!es2iii3 any tra%e!ing &on&ession2i%3 any bon-s 2in&!-ding in&enti%e. prod-&tion and attendan&e bon-s32%3 any &ontrib-tion paid or payab!e by te emp!oyer to any pension "-nd or pro%ident "-ndor "or te bene"it o" te emp!oyee -nder any !a# "or te time being in "or&e2%i3 any retren&ment &ompensation or any grat-ity or oter retirement bene"it payab!e to teemp!oyee or any e; gratia payment made to im2%ii3 any &ommission pa

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77145425 Compensation Management MBA HR