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Human Resources Management - Compensation And Productivity

Wage Fixation and Incentive Schemes - Compensation And Productivity

   Posted On :  13.06.2018 10:07 pm

Wage is fixed based on the value of the amount fixed by wage boards, cost of living in the locality, productivity shown and promised by workers, work to the organization, the scarcity of the skill in the labor market, the difficulties in the job that determine the number of people willing to undertake the job, the affordability of the employer, the extent of prosperity in the industry in a given period and based on the bargaining power of the workers and their unions.

Wage Fixation


Wage is fixed based on the value of the amount fixed by wage boards, cost of living in the locality, productivity shown and promised by workers, work to the organization, the scarcity of the skill in the labor market, the difficulties in the job that determine the number of people willing to undertake the job, the affordability of the employer, the extent of prosperity in the industry in a given period and based on the bargaining power of the workers and their unions. Wage-Productivity relationship is ordinarily taken as a rational basis for wage revision. An increase in output per unit of labor is always a ground for workers to press their claim for higher wages as their due share of the rise in profits.
 
Wages may be of two types such as time rate and piece rate. They are fixed with the help of industrial engineering and personnel departments and are administered by the payroll departments, according to the provisions of the payment of wages law at rates equal to or above the minimum wage law. Equal remuneration for equal work without any discrimination on grounds of gender has been guaranteed by the law. Wage laws insist that wage be paid in cash and not in kind. They also state that the maximum permissible wage period would be thirty days. They even specify the list of deductions permissible, subject to a ceiling. Some of the authorized deductions are recovery of loans, contributions towards social security measures like Provident Fund and Employees’ insurance, damages recoverable from the employees for loss incurred due to the person by the employer, etc.
 

Incentive Schemes


The term ‘Incentive’ means inducements offered in order to get better outputs from people. Incentive schemes are used to enhance the motivation level by tapping the ambitions of the employees to earn more. Incentives tend to influence individuals to stretch their capacities and personal objectives and carry out special tasks and take initiative. Incentives become necessary because people with less ability to perform a specific task but stronger will or motivation are able to perform better than people with superior ability and lack of will. Group incentives have the potential to harness individual efforts towards greater teamwork and synergy.
Tags : Human Resources Management - Compensation And Productivity
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