...International Human Resource Management: Chapter – 6: COMPENSATION MANAGEMENT Introduction: One of the key components of IHRM is the compensation administration in MNCs. Today, compensation and employee benefits contribute to 40-50% of the total costs. Compensation is strategically reported and monitored at the broad – levels and with the investors to assess the health of the organization. What is compensation management? Effective and efficient process of managing the earnings – financial and non financial rewards of the employees in an organization based on their performance towards organizational goal is called compensation management. International Compensation is an internal rate of return (monetary or non monetary rewards / package) including base salary, benefits, perquisites and long term & short term incentives that valued by employee’s in accordance with their relative contributions to performance towards achieving the desired goal of an organization. It influences: • • • Organizational culture Recruitment and selection of competent employees Motivation and performance Objectives of compensation: Compensation decisions are strategic decisions and play a key role in achieving performance and sustainable competitive advantages for national as well as international firms. Therefore the key objectives are: • • • • • Attract employees who are qualified , experienced and interested in international assignments. Facilitate the movement of expatriate’s from one...
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...7SALARY IN POLAND.............................................................................................................................8 8CONCLUSION.........................................................................................................................................8 BIBLIOGRAPHY.......................................................................................................................................8 Analysis 2 Introduction Compensation of employee is important and at the same time really difficult task. Important because it can contribute to growth efficiency and competitiveness in company. Difficult, because it arouses the most controversy and discontent of workers. An effective system of remuneration of employees enables to achieve the following tasks: - recruit and retain...
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...To what extent does executive pay influence company performance Executive pay has a lot to do with company performance. Chief executives, as the leader of a company, can exert some impact on the company’s future. Normally, they get a large amount of payment as well as the severance pay. Except the base salaries, they often get a compensation which is several times of their remuneration. According to CNBC, the average S&P 500 company CEO made 373 times the salary of the average production and non-supervisory worker in 2014, up from 331 times in 2013, according to the AFL-CIO. I would argue that executive pay will effect company performance a lot economically and socially. That kind of high payment could become a motivation for both executives and employees. Just as mentioned by Kubo (2005), in order to get as much pay as executives, employees are more willing to work hard and this is beneficial to the performance of the whole firm. He also showed the evidence from Jensen and Murphy that a high pay-performance sensitivity is better for the company. This means, driven by this kind of system, executives need to pay more attention and put more effort on their daily management, since the payment and the performance are related. Moreover, affected by the sense of equity, executives will see to improve the firm profitability (Fong, 2010). Talented individuals will be attracted to companies which are willing to pay more. And this would make the company more competitive than others...
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...The fast food restaurant is not providing salary and benefits as per the legislation. The minimum pay rate as per minimum hourly rate for the employee classification should be $10.37 but Wesley is getting only $10 without any allowances. Under the Pastoral Award 2010, ordinary hours are 152 hours worked over a four-week period, regardless of whether they fall on a weekend. Ordinary hours for casuals are the same as for full-time employees. Whilst an employer must comply with the minimum rates of pay that are set by awards, federal laws and state laws, the actual rate of pay will depend on the responsibilities and duties which are outlined in the position description , the skill level and experience that the employee demonstrates in the job, and the current market rates being paid on other farms and in other industries for similar skills and abilities. There are minimum hours of work for all part-time and casual employees. For part-time employees the award specifies that the employer must roster the employee for a minimum of 3 hours on any shift. Employer is not an employer of choice. Wesley is getting under pay which is not in the favour of employer. Wesley won’t be satisfied with salary, benefits and other allowances. It will lead to a lack of interest and lack in productivity. Yes this occupational group has an industrial agreement. This fast food restaurant is able to meet their strategic goals and objectives by maintaining a happy working environment and high quality staff...
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...Contents Introduction 3 a) Critically discuss the claim in the above mentioned passage that the most significant trend is the move away from guaranteed compensation to performance related compensation. What are the implications to the organization’s human resource management effectiveness? 3 Performance-Based Remuneration: 3 Guaranteed Variable Salary 4 From guaranteed compensation to performance related compensation. Why? 4 b) Provide a concise overview of how an organization can ensure that its compensation strategies are able to support it strategic objectives 5 • Increased skill and flexibility in the workforce 5 • Reduction in traditional demarcations 5 • Increased efficiency 5 • Tangible benefits for workers in return for changes in working practice. 5 c) Provide a set of arguments to support the view that executive pay should be linked to company performance 6 d) What are the advantages of linking employee pay to performance? 6 Provide a 'felt fair' system of rewarding people according to their contribution 6 Higher performance within the organization may result 7 Provides a tangible means of recognizing achievements 7 People understand the performance imperatives of the organization 7 Link between extra pay and extra performance is clear 7 Conclusion 8 References: 8 Introduction In this assignment I will discuss about compensation and benefit management and many aspects of it and how they can affect an organization and about...
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...| | Compensation is the remuneration received by an employee in return for his/her contribution to the organization. It is an organized practice that involves balancing the work-employee relation by providing monetary and non-monetary benefits to employees.Compensation is an integral part of human resource management which helps in motivating the employees and improving organizational effectiveness. Components of Compensation System Compensation systems are designed keeping in minds the strategic goals and business objectives. Compensation system is designed on the basis of certain factors after analyzing the job work and responsibilities. Components of a compensation system are as follows: Types of Compensation Compensation provided to employees can direct in the form of monetary benefits and/or indirect in the form of non-monetary benefits known as perks, time off, etc. Compensation does not include only salary but it is the sum total of all rewards and allowances provided to the employees in return for their services. If the compensation offered is effectively managed, it contributes to high organizational productivity. Direct Compensation Direct compensation refers to monetary benefits offered and provided to employees in return of the services they provide to the organization. The monetary benefits include basic salary, house rent allowance, conveyance, leave travel allowance, medical reimbursements, special allowances, bonus...
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...Compensation: Compensation Package is an organized practice that involves balancing the work-employee relation by providing monetary and non-monetary benefits to employees. Compensation includes payments such as bonuses, profit sharing, overtime pay, recognition rewards and sales commission. Compensation can also include non-monetary perks such as a company-paid car, company-paid housing and stock options. Compensation is an integral part of human resource management which helps in motivating the employees and improving organizational effectiveness. Importance of Compensation Package: The current competitive conditions in the business world make it difficult to acquire and retain the top talents. Once the organization is able to identify, it can be unable to offer the right pay and to manage the pay increases to retain top talents. The compensation strategy is the extremely important piece of the overall HR Strategy to keep the company competitive and successful. On the other hand, the compensation strategy is important to keep the personnel budget under the control and to manage the jobs in the right salary (pay) brackets. The compensation strategy differentiates the organization on the job market and builds the attractiveness of the company for the top talents. They love to be hired by the attractive organization, they do not like to be hired by the average company offering the same conditions as any other average organization in the...
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...| Lower SecondarySunday to ThursdayFriday and Saturday | 2.30 pm to 6.30 pm8.00 pm to 10.00 pm | Upper SecondarySunday to ThursdayFriday and Saturday | 2.30 pm to 6.30 pm9.30 am to 12.30 pm2.00 pm to 5.00 pm | Material Requirement: Number | Items | Price (RM) per unit/box | Quantity needed unit/box | Total (RM) | 1 | Whiteboard pen | 25 | 4 | 100 | 2 | Whiteboard eraser | 5 | 6 | 30 | 3 | A4 Paper | 15 | 6 | 90 | 4 | Ball pen | 25 | 2 | 50 | 5 | Pencil | 5 | 2 | 10 | 6 | Eraser | 5 | 2 | 10 | 7 | Staples | 5 | 2 | 10 | 8 | Liquid Paper | 20 | 1 | 20 | 9 | Glue | 5 | 2 | 10 | 10 | Ruler | 10 | 2 | 20 | | | | Total | 350 | Employee workforce Position | Total | Teacher | 10 | Salary and Response Remuneration Position | Number | Monthly Salary | KWSP 11% | PERKESO 1% | Total | Teachers | 10 | 8000 | 880 | 80 | 8960 | Machine and Equipment (Class) Types | Price (RM) | Number | Total Price | White Board | 200 | 6 | 1200 | Folding Chairs | 60...
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...Business Research Report Compensation Systems Assessment Code: RWT1 Student Name: Diane Smith Student ID: 337372 Date: October 7, 2013 Mentor Name: Christina Wright Table of Contents Executive Summary 3 Introduction 4 Research Findings 5 Finding Number 1 5 Finding Number 2 6 Finding Number 3 7 Recommendations 8 Conclusion 9 References 10 Executive Summary Compensation represents monetary pay for performance. It is a very important component to our manufacturing company’s Human Resource system. Our 120 employees are the heart of our business. We depend on their knowledge to help our company reach its goals. Therefore, we researched a variety of compensation strategies, which you will read below, that have helped us develop a compensation system that will motivate, encourage, retain and reward employees. There is no perfect system. Not all systems fit all businesses. The idea that pay policies have strategic impact has become a major theme within the compensation literature since the mid-1980’s…analysis reveals that inferior organizational performance is associated with the lack of fit between pay policy and business strategy.” (Montemayor, 1996, p889). But through careful investigation we have found two systems we believe will work well in our company. Through our research, three compensation systems really stood out. We will discuss Merit Based Pay, Salary Plus Commission and end with Salary Plus Bonus. This report outlines our...
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...MANAGING PEOPLE When Salaries Aren’t Secret by John Case FROM THE MAY 2001 ISSUE I t had all happened so fast. Hunched forward, elbows on the desk, Hank let his chin sink deeper into his hands as he gazed out into the night. Outside, the flowers in the officepark garden looked garish under the orange sodium-vapor lights. Hank didn’t notice. He was thinking hard about tomorrow’s staff meeting, which had so suddenly been transformed from a celebration into a—well, he wasn’t quite sure what. He just knew it wouldn’t be pleasant. Hank Adamson, 48, was chief executive officer of RightNow!, a retail chain specializing in offprice clothing for young, fashion-minded women. Frankly, he had been looking forward to a little celebration. Five years ago, his company had bought out a stodgy, 20-year-old retailer of women’s apparel, and Hank had come in to run the place. He renamed it and repositioned it, giving it a hip, edgy style. (Get Your Clothes Half Off was the latest slogan, with a racy ad campaign to match). He invested in rapid growth: RightNow! today had stores in 28 states, with more on the way. Last year, Hank had hired a dozen or so tech-savvy 20-somethings and charged them with creating a killer Web site. Launched just last month, the site was already winning awards and generating substantial business. He’d heard that even the folks in corporate were impressed. But oh, those 20-somethings. One in particular: Treece McDavitt. Hank had noticed her—you ...
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...STUDY OF COMPENSATION MANAGEMENT IN HDFC BANK | |TABLE OF CONTENTS |Page no. | | | Acknowledgement |4 | | | Certificate |5 | |1. |Introduction | | | |Objective |6 | | |Limitation | | | |Scope | | | |Research methodology |7 | | | | | |2. |Details of the Project | | | |2.1 Introduction to compensation...
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...CEO Compensation Thoughts on the current state of executive compensation practices in the US: Current state of Executive compensation within the US differs from different compensation practices within the forms it takes, laws and regulation it's subject to, its dramatic rise over the past 3 decades and wide go criticism leveled against it. Within the past 3 decades in America government compensation or pay has up dramatically on the far side what is often explained by changes in firm size, performance, and trade classification. It’s the very best within the world in each absolute term and relative to median earnings within the America. It has been criticized not solely as excessive, however conjointly for "rewarding failure" as well as large drops available value. Observers dissent on what proportion of the increase in and nature of this compensation may be a natural result of competition for scarce business talent benefiting investor price, and the way abundant is that the work of manipulation and self-dealing by management unrelated to produce, demand, or reward for performance. While our government compensation attorneys perceive the elaborate, technical aspects of government compensation legal problems and governing laws, they tend to conjointly perceive market practices and trends. They tend to facilitate our purchasers establish and perceive the key legal risks in a very industrial context so they will build familiar business selections. They tend to closely monitor key...
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...Running head: PROBLEM SOLUTION: RIORDAN MANUFACTURING Problem Solution: Riordan Manufacturing Khwaja Shaik University of Phoenix Problem Solution: Riordan Manufacturing Riordan Manufacturing is a global plastics producer employing 550 people with projected annual earnings of $46 million. The company is wholly owned by Riordan Industries, a Fortune 1000 enterprise with revenues in excess of $1 billion. Production is divided among three plants: plastic beverage containers in Albany, Georgia; custom plastic parts in Pontiac, Michigan; and plastic fan parts in Hangzhou, China. Research and Development is conducted at corporate headquarters in San Jose, California. Riordan's major customers are automotive parts manufacturers, aircraft manufacturers, the Department of Defense, beverage makers and bottlers, and appliance manufacturers. This research paper will discuss the issues being faced by Riordan Manufacturing and provides solution based on various motivation, rewards and performance concepts Situation Analysis Issue and Opportunity Identification – Total reward system The current reward system is barely based on performance, instead recognizing cost-of-living increases, seniority and position. Faced with declining morale and work ethic, Riordan managers have been pressuring the CEO to "do something" about the rewards system. Riordan’s employees comprise three major demographic groups. Baby boomers make up the bulk of the managerial and about...
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...Journal of Business Ethics (2009) 85:147–156 DOI 10.1007/s10551-008-9934-6 Ó Springer 2008 What’s Wrong with Executive Compensation? Jared D. Harris ABSTRACT. I broadly explore the question by examining several common criticisms of CEO pay through both philosophical and empirical lenses. While some criticisms appear to be unfounded, the analysis shows not only that current compensation practices are problematic both from the standpoint of distributive justice and fairness, but also that incentive pay ultimately exacerbates the very agency problem it is purported to solve. KEY WORDS: executive compensation, distributive justice, pay disparity, incentive alignment Introduction Few academic theories have been adopted as widely as the application of agency theory (Jensen and Meckling, 1976) to the structure of executive pay in modern corporations. After prominent suggestions that the inherent conflict of interest that exists between stockholders and corporate managers – or ‘agency problem’ – could be mitigated through the structure of managerial incentives (e.g., Jensen and Murphy, 1990a), the prevalence and size of stock option grants to senior executives have expanded increasingly and substantially (Hall and Murphy, Jared D. Harris, Assistant Professor teaches both Ethics and Strategy courses in Darden’s MBA program, and a doctoral seminar on corporate governance and ethics. His research centers on the interplay between ethics and strategy, with a particular focus...
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...Please find enclosed Case Study One – Designing a Reward System for “The Fit Stop”, for your review. Using point form, write a brief description of the organization, its employees, and its challenges. What is the organization's domain? (10 points needed) Organization: * The Fit Stop is a new franchise opening in four months. * The Fit Stop will sell all types of training, fitness conditioning and exercise equipment to the general public * The Fit Stop plans to specialize beyond equipment to provide customers with personalized advice geared to customer’s specific training/conditioning needs * It will be starting out with stores in major cities in Ontario and in four western provinces – with plans of expanding to Quebec and the Atlantic provinces * Stores will be located in shopping malls, operating 7 days a week: 9am – 9pm weekdays, Saturdays: 9am – 6pm, and Sundays noon – 6pm. Employees: Employees will range from highly educated (degrees) to high school educated * total employees per store will be 11 to 15 fulltime employees * each store will employ physiotherapist and a person with a Bachelor’s Degree in Kinesiology. * each store will have a Manager with a Bachelor of Commerce Degree * each store will employ sales staff with a minimum high school diploma (8 to 12 per store) Challenges The Fit Stop knows that even though their competitors will sell their equipment at a lower price, none will have the range of equipment that they...
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