We already know a lot about compensation management and components of total compensation package. Today we will learn about the essential components to design a well formed compensation systems for any organization.
As Compensation strategy is a part of business strategy, with the change of organizational structures and business need, the compensation systems have also been changing with time. From the bureaucratic organizations to the participative organizations, employees have started asking for their rights and appropriate compensations. The higher education standards and higher skills required for the jobs have made the organizations provide competitive compensations to their employees. That’s why an ideal compensation system are designed keeping in minds the strategic goals and business objectives. To design a well formulated compensation system following components are used: Continue reading
In human resource management, total compensation package is referred to not only money but also other benefits received by an employee for providing services to his employer. Today we will learn about the components of whole compensation package. An ideal compensation package may identify its various components as follows:
1. Fixed Pay or Base Pay
Base Compensation is one type of Compensation that refers to the basic salaries and wages given to he employees. It is normally constant at a given amount irrespective of the difference in work performance. Continue reading
Dear friends we already learned a lot about compensation management . Now we will learn how to develop and set up a new Compensation plan in any organization. No matter which type of organization or establishment you are dealing with, every organization have to follow the following steps to establish a new compensation plan:
1. Develop program outline
- At first have to set an objective for the compensation program identifying the needs.
- Establish target dated for implementation and completion
- Determine a budget for the plan Continue reading