Compensation & Benefits 11/15/2018 Compensation & Benefits

Compensation Components Base compensation or pay received on a regular basis Pay incentives for good performance Benefits or services arising out of membership status A major cost element (up to 80 percent)

Criteria for compensation distribution Performance Effort Seniority Skills held Job difficulty

Structure of compensation Rewards/Compensation 1. Intrinsic Extrinsic Participation a. Financial b. Non-Financial Job freedom Membership based Performance based Impressive titles Growth Profit sharing schemes Performance bonus Preferred working hours Responsibility COLA Commission Parking space

Characteristics of effective compensation Enables an organization to attract and retain qualified, competent workers Motivates employee performance, fosters a feeling of equity, and provides direction to their efforts Supports, communicates, & reinforces organization's culture, values, and competitive strategy Complies with government regulations Cost structure reflects the organization's ability to pay

Approach to designing compensation Job based approach Skills based approach

Eg of job based pay structure Grade Jobs Pay (Rs/hr) Grade 6 Chef 300 – 500 Grade 5 Manager Deputy Chef 220 - 350 Grade 4 Asst. Manager Lead Cook 100 – 200 Grade 3 General Cook Clerk 50 – 150 Grade 2 Server; Cashier 40 – 80 Grade 1 Kitchen helper Dishwasher 25 – 50 Traditional and more widely used Assumption Work gets done by people who are paid to perform well-defined jobs to achieve specific tasks Not all jobs equally important to the firm Different value of different jobs by the labor market Allocation of pay so that most important jobs pay the most.

Eg of skill based pay structure Block Skills Pay 5 Create new items for menu Finds different uses of leftovers Coordinates & control work of employees Rs 300/ hr 4 Cook existing menu items following recipe Supervises kitchen help Prepare payroll Rs 220/ hr 3 Schedule servers and assign workstations Conduct inventory Rs 160/ hr 2 Greet customers and take orders Assist in kitchen with food preparation Rs 120/ hr 1 Clean and set up table Use dishwashing equipment Rs 60/ hr Modern but far less common Assumptions Workers should be paid by how flexible or capable they are at performing multiple tasks Greater the variety of job-related skills workers possess, the more they are paid

11/15/2018 Employee Relations

Employee Relations (ER) A set of policies, programmes and mechanisms Focused on safeguarding and promoting the basic interests of people at work Within the framework of mutual cooperation between management and employees and human dignity and growth To seek greater organizational effectiveness

ER Programmes Participation: To what extent decision making and control be shared? Protection: Are there aspects of the workplace that threaten the well-being of employees? Rights: How shall we ensure they are in place? Assistance: How shall we respond to the special needs of specific employees? Communication: How best can we convey our organizational philosophy to employee? Recognition: How can we award for the good work done? Social & Informal: How can we understand one another better?

Recognition tips for managers Offer employee reward options Identify what's meaningful to your employees Keep employee recognition fresh Recognize all levels of employees Make sure recognition is given consistently Keep it simple Keep it adaptable Make it timely