Explain Various Wages and Compensation Concepts Explain why job evaluation is necessary. Give examples

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Explain Various Wages and Compensation Concepts
Explain why job evaluation is
necessary. Give examples

• 23 August 2010

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Advance Personnel Management 4
Presentation Lecturer Mr. S Mgudlwa

• Group Members
• Amanda Socenywa
• Archibald Mkubukeli
• Khaya Valashiya
• Boniswa Gae
• Lettie Mabena
• Grace Malapi

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Objectives of the presentation

• Learners will be able to
• Understand the nature of the compensation and Job
  evaluation strategies
• Understand the components of a compensation
  management and job evaluation
• Understand the use of variable reward programs
• Discuss the use of salary packaging and benefits
• Be aware of current compensation issues and
  trends in compensation management

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Compensation
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What Is Compensation?

• Compensation is the total reward received by
• an employee in exchange for services
• performed for an organization.
• Dunn JD, Rachel FM, wage and salary
  administration Total compensation systems

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Strategic objectives of compensation

• The strategic objectives of compensation are to
• Reward past performance
• Remain competitive in the labour market
• Maintain salary equity among employees
• Motivate employees future performance
• Attract and retain good staff
• Reduce unnecessary staff turnover
• Alan N, Robert C. Marian B, Strategic human
  Resource management 2002 4th edition

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Compensation continued

• Purpose of compensation
• WATSON, S. (2005) is job evaluation making
  a comeback - or did it never go away? Benefits
  and Compensation International. Vol 34, No 10,
  June. Pp8-12, 14.

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Compensation systems

• Fixed Compensation
• Variable or Temporary Compensation
• Richard I. Henderson, compensation management
  rewarding performance 6th edition

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Compensation cont

• Incentives and recognition rewards
• Incentives Rewards
• Grobler p, Warnich S, Carrell M R, Elbert N .F,
  Hartfield R.D , Human Resources Management in
  south Africa 3rd edition 2006

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Compensation Policy

• Matching the competition
• Lead policy
• Lag approach
• Fisher Schoenfeldt Shaw, Human Resource
  Management 1999 4th edition

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Advantages of compensation

• Employer
• Job satisfaction
• Motivation
• Low Absenteeism
• Low Turnover
• Fisher Schoenfeldt Shaw, Human Resource
  Management 1999 4th edition

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Advantages cont.

• Advantage to Employees
• Peace of Mind
• Increases self-confidence
• Fisher Schoenfeldt Shaw, Human Resource
  Management 1999 4th edition

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Wages . definition

• Wages is remuneration received by an
• employee (group of employees) for service
• rendered during specific period of time
• hour, week, or month.
• Milkovich, GTNewman, JM.2002. Compensation.8th
  edition.Boston Irwin Mc Graw-Hill

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Wages continued

• The main types of wages are
• Subsistence wage
• Minimum wage
• Fair Wage and
• Living Wage
• Milkovich, GTNewman, JM.2002. Compensation.8th
  edition.Boston Irwin Mc Graw-Hill

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Job evaluation

• Is the process of systematically determining
• a relative internal value of a job in an
• organization.
• EGAN, J. (2004) Putting job evaluation to work.
  IRS Employment Review. No 792, 23 January.
  Pp8-15.

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Job evaluation continued

• Principles of Job Evaluation
• When to use job evaluation
• Types of job evaluation
• CAS. (2008) Job evaluation considerations and
  risks. Advisory booklet. London Acas. Available
  at http//www.acas.org.uk/index.aspx?articleid68
  2

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Job evaluation continued

• Implementing a scheme

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advantages and disadvantages of job evaluation
methods

• Job ranking methods
• Job classification method
• Point method
• Grobler p, Warnich S, Carrell M R, Elbert N .F,
  Hartfield R.D , Human Resources Management in
  south Africa 3rd edition 2006

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Advantages and Disadvantages continued

• Factor comparison method
• Grobler p, Warnich S, Carrell M R, Elbert N .F,
  Hartfield R.D , Human Resources Management in
  south Africa 3rd edition 2006

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Conclusion

• Recommendations