Surprise Test 2 Shivani Joshi 2k20/umba/38 Ans 1 - Job Based Compensation

Surprise test 2
Shivani Joshi
2k20/umba/38
Ans 1 .
Job based compensation
In a job based pay structure an employee is essentially paid for the value of work they perform
for the company. This gives the compensation a more tangible quality than a skill based
structure where a supervisor must assess the value of the skills and qualities you bring to the
table.
Under job based compensation and employer typically have a grades or schedules indicating
the salary or wages for each particular job and this enables the employee to see the relative pay
of the duties assigned
Advantages of of job based compensation

● Easy comparison is possible between companies
● Simpler than a competency-based system as more work is required to define knowledge
skills and competencies
Competency based pay

Under this pay structure an employee is compensated based on this skill set knowledge and
experience rather than their job title or position . Competency based pay encourages employee
to reach the period that the wanted by taking charge of improving their skill and work
Advantages of competency based pay

● Competency based pay in courage is a culture of self motivation and improvement within
the company
● Employee lysis their potential to earn with competency based pay and what skills they
need to acquire to reach the pay they desire
Ans 2 . Seniority and longevity pay

Salary of which is based on seniority or length of service with an organisation the greater the
length of service the greater the longevity pay
This system reward employee with periodic additions to the base pay according to employee
length of service in performing their jobs
Seniority pay
It rewards job 10:00 your employees time as member of a company explicitly through
permanent increase to base pay
Advantages of seniority pay

To employees
● Received that they are treated fairly because they even pay increases according to
seniority
To employer's
● It facilitates the administration of pay programs employees are less likely to off and
employees by showing favoritism to others
Longevity pay
Is used to reward employees who have reached pay grade maximum and who are not likely to
move into higher grades
Advantages
● Keep the employee engaged in the organisations
● Act as a motivator to the employee
Linking of merit pay with competitive strategy

Merit pay is the increase in pay based on goals or achievements by an employer rather than a
pay rate based on a union contract. It is also known as pay for performance
Merit pay typically involves a supervisor meeting with the employee to discuss employees work
and to reward and increase or a bonus based on the performance
● Merit pay helps in employee to differentiate between performance of high and low
performing employees and reward them accordingly
● Encourages employees to stretch their own limit to achieve the best
● Helps the employee to differentiate between the performance of the company as a whole
and the performance of individual
● Merit pay give the employees the recognition and reward they deserve and also help
companies to retain their best employees
Ans 3. Aligning of compensation strategy with HR strategy and business strategy

The compensation strategy is extremely important as a right compensation strategy helps to
develop an effective and competitive organisation .
Compensation strategy defines the position of organisation on the job market the level of total
cash the main bonus principles in the organisation and the rule for the base pay
Aligning compensation strategy with HR strategy

1. Develop human resources
Total reward approach that emphasizes the importance of enhancing the work
environment
2. Retain effective performers
competitive pay structure that helps retain high quality employee
3. Establish positive corporate reputation
performance management process that promotes continuous improvement
Aligning compensation strategy with business strategy

1. Achieving competitive advantage through innovation
- provide financial incentive and recognition for innovation
2. Achieving competitive advantage through low cost
-review all reward practices to ensure that they provide value for money
3. Achieving competitive advantage through quality
-link reward to quality performance
Ans 4 .
Traditional pay system sets pay levels in a narrow band with regular annual increases. There
may be three to four percent pay increase and only increases are meant for promotion, merit
,cost of living etc . There is less distinguish between merit increases and cost of living increases
Basis for traditional pay
● Individual performance
● Base wage or salary
● Cost of living and labour market
● Evenly distribution between employees
Modern pay system page greater emphasis on variable pay rather than automatically increase
each year . In other words the basic wage is seen as what the job is worth on the open market
Basis for modern pay
● Based on team and organisational performance
● Mean of communicating values
● Variable pay
● Based on competitive strategy of the organisation
Designing of a compensation plan

The organisation may be able to decide as competition plant in computing days compensation
will provision of wage salary increase over the period of time, various incentive plans, benefits
and prerequisite
Sometimes these are determined by external party for example pay for Government employees
as well as for public sector enterprises
After designing the compensation plan it is implemented

Implementation of compensation plan required it communication to employees and putting it into
practice
Evaluation and review

Competition plan is not rigid and fixed one but is a dynamic since it is affected by the various
factor therefore compensation management should have a provision for evaluating and leaving
the compensation plan after implementation of the plant it will generate result is there in terms of
intervening variable like employee satisfaction and moral or in terms of end result variable like
increasing productivity however this later variable is more important evaluation of compensation
plan must be done in this light if it does not work as extended there should be a review of plan
necessitating a fresh look
Ans 5 . Salary survey is a standard method of gathering information about employees
compensation including benefits and payments
Objective of a salary survey

The purpose of salary service to determine the extent to which the organisation pay scales are
like of those enterprise in the region.
So they must be taken into consideration while fixing the wage for different jobs in the
organisations .
Importance of salary survey

1. Sari so gai helps to ensure that the organisation is on the right side of the labour and
industrial law it helps us avoid price fixing which mein put the organisation at the risk of
violating the labour laws
2. Services we provide the fair knowledge of the development in the industry and helps us
gather important information about the right compensation package for talents at
different level of positions in an organisation
3. Feedback gathered from a salary survey gives an organisation or clear idea of what is
obtainable in an industry. Also helps in in preparing a competitive reward for the
employees

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Surprise test 2

Advantages of of job based compensation

Competency based pay

Advantages of competency based pay

Ans 2 . Seniority and longevity pay

Advantages of seniority pay

Linking of merit pay with competitive strategy

Ans 3. Aligning of compensation strategy with HR strategy and business strategy

Aligning compensation strategy with HR strategy

Aligning compensation strategy with business strategy

Designing of a compensation plan

After designing the compensation plan it is implemented

Evaluation and review

Objective of a salary survey

Importance of salary survey

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