CompensationMuhammad Adeel & Fakhar Husnain

Agenda

❏What is Compensation

❏Different Types of compensation

❏Weight & Effect of Compensation Policy for an organization

What is Compensation ?❏Employee compensation

refers to the benefits (cash, vacation, etc.) that an employee receives in exchange for the service they provide to their employer.

Types of Compensation

❏Cash Compensation

❏ wages or Salaries

❏Retirement Plans

❏Paid Leaves

❏Life Insurance

❏Disability insurance

Cash Compensation

❏Cash Compensations are all cash payments earned by an employee in the form of wages , salaries, overtimes Etc.

❏TCC (Total Cash Compensation)❏ Cash Payments earned within a year of full-time

employment

Retirement plans❏A retirement plan is

a financial arrangement designed to replace employment income upon retirement. These plans may be set up by employers, insurance companies, trade unions, the government, or other institutions.

Paid Leaves

❏ Paid leaves are generally a pre-determined number of paid leaves an employer offers to employees, every year. This leave is treated

more like a benefit from the employee's point of view.

Life Insurance

❏sum of money either on the death of the insured person or after a set period.

Disability Insurance❏ periodic payments of

benefits when a disabled insured is unable to work

❏ The insurance product is designed to replace anywhere from 45 to 65% of your gross income on a tax-free basis

Effect on Organization

❏Employee Motivation

❏Effectiveness in attracting new Talent

❏Cost Effectiveness

Cost Effectiveness Ratio

Costnew strategy - Cost Current Practice

❏ Cost Effectiveness Ratio = -------------------------------------------------

Effectnew strategy - EffectCurrent

Practice

Questions ?

References

➔ Images◆ http://www.google.com.pk/

➔ Contents◆ http://study.com

◆ http://drive.google.com

◆ http://www.differencebetween.net

◆ http://slideshare.net