Compensation and Benefits
|1.||How is compensation used?|
Compensation is a tool used by management for a variety of purposes to further the existence of the company. Compensation may be adjusted according the business needs, goals, and available resources. Compensation may be used to:
|2.||What are the different types of compensation?|
The different types of compensation include:
|3.||What are the main influencers that may affect employee compensation?|
There are two main influencers that may affect employee compensation:
a) Internal Influencer
b) External Influencer
|4.||What is Compensation Strategy?|
Compensation strategy is a plan that determines how employee been paid and rewarded for their work. Basically it's relying on the current market for the people with the same skill and total available funding of the corporation is capable to expand on payroll.
|5.||How frequent should employer formally reviewing compensation and benefit to employee?|
The best practise is to review every 2 years, however if the organisation has made a number of changes to jobs; or has fallen on benchmarking pay in the fast few years; is competing to find talent or focused on retaining average; then annually review is the best. The most important thing is organisation must make sure that the benefit offered is in line with the current market.
|6.||How bonus plan benefit employer?|
Bonus plan may benefit the employer in three situations:
a) Adjust Labour Cost to Financial Results
b) Drive Employee Performance
c) Employee Retention
|7.||What are the reasons for Employer in offering good benefit to employee?|
Reasons for employer to offer good benefit to employee are:
a) Increase Organisation Image
Offering best plan for benefit exhibit organisation capable enough to invest for their employee and prove the stability.
b) Minimise Organisation Turnover Rate
Investing in your employees show that organisation has best interest and value employee performance. It also can help organisation build a tight -knit team of professional that will stay for years.
c) Better Morale
Adequate benefit can keep employees happy because nothing can damper on productivity quicker other than bad attitude.
d) Healthier Employees
Offering solid health insurance to employee will encourage them to make regular check up and take preventive medical step therefore it should help ensuring they don't take many sick leave. In the meantime it will help provided healthy workforce.
e) Better Job Performance
By offering attractive benefits, employees will care about organisation and remain loyal. As a result they will work harder; therefore it leads to greater productivity and higher performance.
|8.||What Are Fringe Benefits for an Employee?|
|Fringe benefits are forms of compensation that employer offers to employee instead of stated wage or salary. Common examples of fringe benefits include medical and dental insurance, housing allowance, educational assistance, car allowance, sick pay, meals allowance etc.|
|9.||What are the main techniques for Job Evaluations?|
Job evaluations is regarding to the system that comparing jobs for the purpose of determining right compensation levels for individual jobs or job element. There are four main techniques involves in Job Evaluation:
Ranking refer to the method whereby jobs are compared to each other based on the overall worth of the job to the organisation. The 'worth' of a job is usually based on judgements of skill, effort, responsibility and working conditions.
In classification technique it will group similar position into job classes based on pre- defined class specification.
c) Factor Comparison
It refers to a set of compensable factors that are identified as determining the worth of jobs. Normally the number of compensable factors is small. Examples of compensable factors are skills, responsibilities, effort and working condition.
d) Point Method
The point method can be related with the factor comparison since it comprise set of compensable factors which identified as determining the worth of jobs. Typically, the compensable factors include the major categories of skills, responsibilities, effort and working condition.
|10.||What are the results of job evaluation process?|
There are five result of job evaluation process:
a) Fixing a salary range for the employees in the organisation.
b) Creating a position hierarchy in the organisation.
c) A foundation for salary increase and/or promotion of an employee in the position.
d) Reclassifying the position to higher or lower rank with or without a change in salary of the position incumbent.
e) Confirmation that positions is properly classified.