ch 4 wage salary admin.ppt

7/27/2019 ch 4 wage salary admin.ppt

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Wage and salaryAdministration


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5 REASONS WHY EMPLOYEES STAY:

1. Pride in the organization. People want to work for well-

managed companies.2. Compatible supervisor. People may stay just to work for a

particular individual who is supportive of them.

3. Compensation. People want to work for companies that offer

fair compensation, including competitive wages and benefits as

well as opportunities to learn and achieve.4. Affiliation. People want to continue working with colleagues

they respect and like.

5. Meaningful work. People want to work for companies that let

them do work that appeals to their deepest, most passionateinterests.


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Top-Five Reasons Why People Quit Their Jobs

1. Management demands that one person do the jobs of two or more

people, resulting in longer days and weekend work.

2. Management cuts back on administrative help, forcing

professional workers to use their time copying, stapling, collating,filing and other clerical duties.

3. Management puts a freeze on raises and promotions, when

an employee can easily find a job earning 20-30 percent more

somewhere else.

4. Management doesn't allow the rank and file to make decisions orallow them pride of ownership.

5. Management constantly reorganizes, shuffles people around, and

changes direction constantly.


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Nature and purpose

Establishment and implementation of sound

policies and practices of employee compensation

To establish and maintain an equitable wage and

salary structure

Balancing of conflicting personnel interests sothat satisfaction maximized and conflicts

minimized

Financial aspect of needs, motivation and rewards


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Objectives

For employees

Highly skilled jobs are paid more

compensation then low skilled jobs this

eliminated inequalityChances of favoritism are minimized

Job sequence and line of promotion are

established

Employees morale and motivation are

increased


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To employers

Systematically plan for labor cost

In dealing with trade union, they can

explain it based on systematic analysis

Reduces chances of friction andgrievances

Enhances motivation and morale

Attracts qualified employees


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Compensation, Reward, wage levels

and wage structureCompensation defined as money received

in the performance of work plus benefits

and servicesMoney is included under direct

compensation while benefits come under

indirect compensation consist of life,accident and health insurance, retirement

benefits, pay for vacation and social

security


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Wage:- is remuneration paid for the service of

labor in production periodically to worker

It refer to hourly rate or daily rate paid to bluecollar workers

Salary refers to weekly or monthly rates paid to

white collar workersWage level represent money an average worker

makes in organization

Wage structure describes wage/salary relationshipwith particular grouping

The grouping can be according to occupation such

as craftsmen


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Wage determination process

. Job analysis

Jobevaluation

Wage

surveys

Wage

structure

Differential

employeeappraisal

Wage surveys

& analysis of

relevant

organizational

problems

Performance

standards

Wage

payments

Rules ofadministrat

ion

Jobspecification

job

description


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Job analysis:- results injob

descriptions which lead tojob

specificationA job is rated in order to determine its

value compare to all other job in

organization and providing it with a

price

This involves converting job value intospecific Monterey value or rate ranges


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Wage surveys:- once the relative worth of job

is done , the actual amount is determined

This is done by making wage or salary surveys

Such surveys seek to answer questions like

what are the other firms paying? What they are

doing for benefits? Level of pay offered by

other firms for similar occupations?

Relevant organizational problems:- what will

be results of paying lower or higher

compensation? Relationship between wage

structure and fringe benefits?


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Preparation of wage structure:- for this

several decision has to be taken such as

Whether organization able to pay above,below, or equal to average in industry

Whether wages ranges on merit basis or single

rates

The number and width of pay grades

Actual money value to be signed to gradesDifference between pay plans


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Defining the Labor Market

L ist of Key Job Position

Detailed Descr iption of Jobs

Collection of Salary Data

Compilation of Salary Data

Results Survey


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Rules of administration:-

To determine what extent advancement

will be on length of service rather then

merit

With what frequency pay increases willbe made

How control over wage and salary cost

can be determinedRule for promotion from one pay grade

to another

i fl i d l


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Factors influencing wage and salary

structure and admin

The organizations ability to paySupply and demand of labor

The prevailing market rate

The cost of livingProductivity

Trade unions bargaining power

Job requirements

Managerial attitude

Psychological and social factors

Levels of skills available in market


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THANK YOU

Documents

ch 4 wage salary admin.ppt