Professional Documents
Culture Documents
Success or failure of an organization depends upon the human For any organization to function effectively , it must have resources of human HRM is to secure the best from people by winning their wholehearted cooperation
CHARACTERISTICS OF HRM
Pervasive force Action oriented Individually oriented People oriented Development oriented Integrating mechanism Comprehensive function Auxiliary service Inter-disciplinary function Continuous function
SIGNIFICANCE OF HRM Significance for an enterprise Attracting and retaining Developing Securing willful cooperation Utilizing Ensuring the competent and dedicated team Professional significance Personal development Healthy relationships Allocation of work
SIGNIFICANCE OF HRM
Social significance Suitable employment Balance between jobs available and jobseekers Eliminate waste human resource National significance: Assignment???
FUNCTIONS HRP Job Analysis Staffing Indoctrination T&D PMS Career Planning Compensation Benefits Labor Relations Record Keeping
WHY HRM
Globalization Profitability through growth Technology Intellectual Capital Change, Change and more change
FUNCTIONS Grievance procedures Disciplinary procedures Conflict resolutions Quality circles Participative Management Organizational Change and OD Absenteeism
INTRODUCTION Money received in performance of work and many kinds of services and benefits that an organization provides to the employee Systematic approach to providing monetary value to the employees in exchange for the work performed A tool used by the management to further the existence of the organization Adjustable to the goals, available resources and needs of the business
INTRODUCTION All forms of tangible benefits and financial returns that an employee receives as part of employment relationship Integral part of HRM that helps in motivating the employee and increasing the effectiveness of an organization by paying salary or wage
WAGE/SALARY
Remuneration for labor is wage Contractual income Piece or time, it is agreed upon before the product is sold
Salary is calculated annually or monthly Earnings relates to the remuneration receives in cash and kind at regular intervals for the time worked with remuneration for time not worked Excludes social security and pension schemes
COMPENSATION Traditional system: follow the instructions Physical needs Job security, increments etc
But now everything is changed Psychological needs are important Participative management Align to the business goals and strategies Monetary and non monetary benefits Competitive compensation
OBJECTIVES Recruit and retain qualified people To have enthusiastic and delighted employees Motivation Retain skilled and talent staff Internal and external equity Reduce turnover Loyalty Equality and fairness in terms to pay to work Reward exceptional performances Control cost Compliance with legal regulation
WHY
Most important element in the employment relationship Equal interest to all
Employer: cost, performance is important Employee: decent standard of living Government: employment, inflation, purchasing power
COMPONENTS
Job description: in writing responsibilities, duties, location, functions, can be individual or group Job analysis: JD is developed from JA Job evaluation: worth of job Pay structure: grades, standardizing the compensation Salary survey: may purchase or conduct your own Policies and regulations: fair compensation, internal and external equity Total compensation package
Basic pay: first component. determined according to the level of skill, effort and responsibility required to perform the job Bonus: for an exceptional performance, gift, reward, for special occasions, short term a gift over and above what is normally due as remuneration to the receiver 4 types of bonus
Production bonus Bonus as an implied term of contract between the parties Customary bonus Profit bonus:
statutory recognition in payment of bonus Act , depends on profits in a relevant year, executives deserve more than non managerial staff
DIRECT COMPENSATION
Long term incentives or stock options: right to buy a piece of business Perks : in addition to normally allowed perks like PF, Gratuity it includes vacations, membership cards, well furnished houses, telephone bills, car fuel, driver, servants etc
INDIRECT COMPENSATION
Flexi hrs Elder care Retirement schemes laundry Tickets Child care Clothing Paid leaves etc
FACTORS
Cost of living
Comparable pay---accurate labor market data Cost of living: COL allowance As per labor representation
FACTORS, EXTERNAL
Legislation
The Payment of Wages Act, no irregularities and no unauthorized deductions The Minimum Wages act, 1948, State and Central Govt. to fix in sweated industries The Equal Remuneration Act, 1976 The Equal Pay Act, 1963 The Companys Act, 1956 Wage Boards, Tribunals and fair wages committees
FACTORS, EXTERNAL
The economy
Depressed Booming COL is used as pay standard, COL grows as economy expands
Compensation survey
Outsource or self Market rate is most important
JOB ANALYSIS
Determine the task Classify, exempted and non exempted Model JD Finalize and document all JDs Evaluate General task analysis by departments Verify ranking by comparing, change if required Prepare matrix Determine grades Establish levels Salary range, monetary range is determined
DETERMINANTS
Education Experience Performance Product market Labor market All play a crucial role in pay determination
FRINGE BENEFITS
Remuneration received can not measure the contribution made, so other than salaries, certain supplementary services are available fringe benefits Additional to regular wages and not a substitute Primarily for the benefit of an employee Which can be expressed in terms of cash Different from welfare services If no relation to the employment, it is not a fringe benefit
CLASSIFICATIONS For employee security: retirement plans, social security, unemployment compensation Increase satisfaction causing reduction in turnover: vacations, sick leaves, holidays, discounts on companys goods and services Statutory: medical care, gratuity, PF etc Contractual: agreement, DA, HRA, city allowance, night shift allowance Voluntary : unilaterally by the company, incentive for family planning, washing allowance, suggestion rewards