1. All Rights Reserved AAM 2053 HUMAN RESOURCE MANAGEMENT Dr. Khairunneezam Mohd Noor FKP USIM DrNeezamNoorFKPUSIM2014 Chapter 4 – 1

2. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 2 All Rights Reserved PAYMENT SYSTEMS AND WORKING HOURS 5 CHAPTER DrNeezamNoorFKPUSIM2014

3. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 3 PREVIEW  The different types of payment structures, including basic pay, benefits and incentives.  Wage systems currently in use.  Factors which influence the quantum of wages paid by employers to employees.  The legal requirements which impact the payment of wages.  The provisions of the Employment Act 1955 on working hours.

4. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 4 PREVIEW (cont.)  Overtime working.  The shift system of working.  Alternative work schedules such as flexitime, job-sharing and part-time work.  The advantages of teleworking and working from home.

5. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 5 THE IMPORTANCE OF WAGE SYSTEMS  Wages are important to employees — standard of living and status  Wages are important to employers — cost of production  Wages are important to society — competitiveness of Malaysian businesses

6. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 6 REMUNERATION PACKAGE REMUNERATION WAGESBENEFITSINCENTIVES

7. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 7

8. All Rights Reserved  Remuneration DrNeezamNoorFKPUSIM2014 Chapter 5– 8 Remuneration is the compensation that one receives in exchange for the work or services performed. Typically, this consists of monetary rewards, also referred to as wage or salary. A number of complementary benefits, however, are increasingly popular remuneration mechanisms. Remuneration is one component of reward management.

9. All Rights Reserved Remuneration Package for An Academic Staff in USIM DrNeezamNoorFKPUSIM2014 Chapter 5– 9 TUTOR (GRADE DA41) – BASIC SALARY – RM 2000 ALLOWANCE - RM 550 BENEFITS – MEDICAL BENEFITS, LOANS, PAID LEAVE, ETC LECTURER (GRADE DS45) – BASIC SALARY – RM 3200 ALLOWANCE - RM 1750 BENEFITS – MEDICAL BENEFITS, HOUSING LOAN, PERSONAL LOAN, PAID LEAVE, ETC SENIOR LECTURER (GRADE DS51/52) – BASIC SALARY – RM 5300 ALLOWANCE - RM 2300 BENEFITS – MEDICAL BENEFITS, HOUSING LOAN, PERSONAL LOAN, PAID LEAVE, ETC

10. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 10 GOALS OF REMUNERATION SYSTEMS Employer’s Goals  To maximize profits  To have an attractive package  To retain the best employees  To have a system simple to administer

11. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 11 GOALS OF REMUNERATION SYSTEMS (cont.) Employee’s Goals  To maximize income  To have a stable income

12. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 12 WAGE SYSTEMS  Time-related system  Piece-work/payment by results  Combination

13. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 13 FACTORS AFFECTING LEVELS OF PAY EXTERNAL FACTORS The labour market Cost of living Collective bargaining Legal requirements EXTERNAL FACTORS The labour market Cost of living Collective bargaining Legal requirements Wage Mix INTERNAL FACTORS Compensation policy of organization Worth of the job Employee’s relative worth Employer’s ability to pay INTERNAL FACTORS Compensation policy of organization Worth of the job Employee’s relative worth Employer’s ability to pay

14. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 14 INDIVIDUAL EMPLOYEE’S WAGES  Seniority  Degree of skill and experience  Increase in the cost of living  Performance Equal pay for equal work? (based on gender, race, age, etc)

15. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 15 LEGISLATION RELEVANT TO REMUNERATION  The Employment Act  The Sabah Labour Ordinance  The Sarawak Labour Ordinance  The Wages Councils Act

16. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 16 LEGISLATION RELEVANT TO REMUNERATION (cont.)  Frequency of wage payment  Timing of wage payment  Mode of payment  Advances on wages  Deductions from wages  Situations when wages are not required to be paid  Failure to pay wages

17. All Rights Reserved LEGISLATION RELEVANT TO REMUNERATION (P166 cont.) http://minimumwages.mohr.gov.my/employees/ about-minimum-wages-policy/ DrNeezamNoorFKPUSIM2014 Chapter 5– 17

18. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 18 LEGISLATION RELEVANT TO REMUNERATION (P166 cont.) MINIMUM WAGES Wages Councils Act establishes minimum wages for:  Shop assistants  Hotel and catering industry workers  Cinema workers  Port of Penang stevedores and cargo handlers

19. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 19 MINIMUM WAGES (cont.)  How much should the minimum wage be?  Should the minimum wage be the same for all workers throughout the country?  How often should the minimum wage be changed? If Malaysia were to introduce a minimum wage for all workers: LEGISLATION RELEVANT TO REMUNERATION (cont.)

20. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 20  Would the introduction of a minimum wage mean that all wages would have to be raised, and if so, what would be the impact on employers?  Would employers be less likely to employ labour and prefer to automate rather than pay high wages? MINIMUM WAGES (cont.) LEGISLATION RELEVANT TO REMUNERATION (cont.)

21. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 21 WORKING HOURS Restrictions on working hours established by the Employment Act and SLOs: No employee shall be required under his contract to work:  more than 8 hours per day or  more than 48 hours per week or  more than 5 consecutive hours without a 30-minute break

22. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 22 WORKING HOURS (cont.) Employees within the scope of the Employment Act and SLOs are entitled to:  One rest day per week  Minimum public holidays: Employment Act = 10 Sabah Lab. Ord. = 14 S’wak Lab. Ord. = 16

23. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 23 WORKING HOURS (cont.) Overtime Work  Overtime work, i.e. work done outside the normal hours of work is permitted up to a maximum of 104 hours per month.  Overtime work cannot be made compulsory except in certain circumstances and in certain industries (the essential services).

24. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 24 WORKING HOURS (cont.)  Overtime work must be paid at premium rates.  Monthly rated workers are entitled to 1.5 x their hourly rate of pay when they work overtime hours.  An employee may not be permitted to work more than 12 hours per day inclusive of overtime.

25. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 25 OVERTIME WORK ADVANTAGES:  Production or service levels increase without hiring extra workers  Provides opportunity for workers to increase their income ADVANTAGES:  Production or service levels increase without hiring extra workers  Provides opportunity for workers to increase their income DISADVANTAGES:  Higher cost per hour of labour  May cause fatigue which leads to accidents  May cause dissatisfaction amongst workers DISADVANTAGES:  Higher cost per hour of labour  May cause fatigue which leads to accidents  May cause dissatisfaction amongst workers

26. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 26 SHIFT WORK Types of Shift Work  Double day  Triple shift  Continuous  Semi-continuous  Split shift  Rotating or fixed shift

27. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 27 SHIFT WORK (cont.)  Does shift work cause health problems?  Are shift workers as productive as non-shift workers?  What are the costs of shift work?

28. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 28 ALTERNATIVE WORK SCHEDULING Flexitime Job-sharing Part-time working Teleworking Homeworking

29. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 29 REVIEW  The different types of payment structures, including basic pay, benefits and incentives.  Wage systems currently in use.  Factors which influence the quantum of wages paid by employers to employees.  The legal requirements which impact the payment of wages.  The provisions of the Employment Act 1955 on working hours.

30. All Rights ReservedDrNeezamNoorFKPUSIM2014 Chapter 5– 30 REVIEW (cont.)  Overtime working.  The shift system of working.  Alternative work schedules such as flexitime, job-sharing and part-time work.  The advantages of teleworking and working from home.