SALARY COMPENSATION MANAGEMENT


Hey Friends,
As a Human Resource Student at Makerere University Business school, I would love to share about how employees can actually be compensated or rewarded at theirs places of work.

For Starters, What is Compensation?
Compensation is the designing and implenting of a total compensation package to employees using a systematic approach to provide value to employees in exchange for their work performance at their places of work.
images.jpeg

Image Source 👇
https://news.cgtn.com/news/2020-06-23/Why-have-meat-factories-become-hotbeds-for-coronavirus-outbreaks--RyERNDEg1O/share_amp.html

ompensation can also be the making of fair payments, equitable and competitive in the current market and providing employees with incentives inorder to improve or boost their performance at their places of work.

Compensation had got it's scope and elements as summarized below:

  • Basic compensation for the job that's to say wages and salaries.
  • Incentive compensation for employee on job.
  • Supplementary compensation paid to the employees as fringe benefits and employee services.
  • Non monetary benefits.
  • Perquisites that's to say, special rights and privileges of the employees enjoyed as per position.

What are the Systems of Wage Payment?
Wage Payments are divided onto two ways; Time Rate system and the Piece Rate System.

√ TIME RATE SYSTEM.
This kind of System is the oldest but the simplest form of Wage payment, it's used extensively in industries and government departments. The wages are paid per time workers spend at the work place especially factories. Efficiency, sincerity and ability are not attended to but the time spent by each worker at the factory is paid for.

MERITS OF THIS KIND OF WAGE PAYMENT SYSTEM.

  • Minimizes misunderstandings among workers.
  • Receives support from Trade unions.
  • There's Guarantee on minimum wages.
  • Convenient in modern factory systems.
  • Easy and simple to maintain.

DEMERITS OF TIME RATE SYSTEM.

  • There's strict supervision.
  • It's not scientific
  • Not initiative to workers.
  • There's no effect on productivity.
  • Increase in Labor Costs.

    • √ PIECE RATE SYSTEM.
      This is an incentive wage system that encourages workers to produce more and earn more. Wages are paid per output of workers at the factory.
      This kind of Payment is fair to employees than the Time Rate system since it pays according to output not time.
      images (2).jpeg
    Image Source👇
    https://www.istockphoto.com/photos/factory-workers

    MERIT OF THIS KIND OF PAYMENT SYSTEM.

    • Wages are linked to efforts of employees.
    • There's less supervision.
    • Better Utilization of Resources like Machinery.
    • Brings Cordial Relations.
    • There's freedom of work to workers.
    • It's an incentive system of Payment.
    • Fair to employees unlike the Time Rate System.
    • Encourages workers to take initiative at work.

      • DEMERITS OF THE PIECE RATE SYSTEM.
      • Not fair to trainees.
      • Quality of production is affected.
      • There's no guarantee on minimum wage.
      • No Unity among workers.
      • Complicated system.
      There are key issues that have affected the reward and compensation system, and these are;

      Covid 19 pandemic.

      How to continue to provide motivation for those who reached the top of their pay range.

      How to reward people for their outputs and inputs at work.

      Management process and ensure that managers are committed and have skills required.

      How to reward individual performance and contribution and promote team work.

      Inconclusion, employees need to be rewarded for their work performance inorder to motivate them to produce quality output at their work places.

      Hope I have educated someone out there with such an amazing topic.
      Have a Great Tuesday ❤️


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19.09.2021 08:31
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