Salary and wage management

SALARY AND WAGE MANAGEMENT

In this article we are discussing the ways and means of fixing the compensations levels taking into consideration various factors like experience, identical industry knowledge, qualifications and proven skills. This in short we have comprehended as ‘Salary and Wage Management’.

Acquire Qualified Personnel:

Compensation needs to be high enough to attract applicants. Pay levels must respond to supply and demand of workers in the labor market since employers complete for workers. Premium wages are sometimes needed to attract applicants who are already working for others.

Retain Present Employees:

Employees may quit when compensation levels are not competitive resulting in higher turnover of manpower.
Ensure Equity:

Compensation management strives for internal and external equity. Internal equity requires that pay be related to the relative worth of jobs, so that similar jobs get similar pay. External equity means paying workers what comparable workers at other firms in the labor market pay.

Reward Desired Behavior:

Pay should reinforce desired behaviors and act as an incentive for those behaviors to occur in the future. Effective compensation plans reward performance, loyalty experience, responsibilities, and other behaviors.

Control Costs:

A rational compensation system helps the organization obtain and retain workers at a reasonable cost. Without effective compensation management, workers could be over or under paid.

Comply with Legal Regulations:

A sound wage and salary system considers the legal challengers imposed by government and ensures the employer’s compliance.

Facilitate Understanding:

System should be easily understood by human resource specialists, operating managers, and employees.
Wage and salary programs should be designed to be managed efficiently, making optimal use of the human resources information system, although this objective should be a secondary consideration compared with other objectives

Systems to Achieve the Objectives

The above mentioned objectives are achieved by the use of the following systems.

1. Job Evaluation:
All jobs will be analyzed and graded to establish the pattern of internal relationships. It is the process of determining relative worth of jobs. It includes selecting suitable job evaluation techniques, classifying jobs into various categories and determining relative value of jobs in various categories.

2. Wage and Salary Ranges:
Overall salary range for all the jobs in an organization is arranged. Each job grade will be assigned a salary range. These individual salary ranges will be fitted into an overall range.

3. Wage and Salary Adjustments:
Overall salary grades of the organization may be adjusted based on the data and information collected about the salary levels of similar organizations. Individual salary level may also be adjusted based on the performance of the individual employees.

Principles of Wage and Salary Administration

There are several principles of wage and salary plans, policies and practices. The important among them are:

(a) Wage and salary plans and policies should be sufficiently flexible.

(b) Job evaluation must be done scientifically.

(c) Wage and salary administration plans must always be consistent with overall organizational plans and programs.

(d) Wage and salary administration plans and programs should be in conformity with the social and economic objectives of the country like attainment of equality in income distribution and controlling inflationary trends.

(e) Wage and salary administration plans and programs should be responsive to the changing local and national conditions.

(f) These plans should simplify and expedite other administrative processes.

The Elements of Wage and Salary System

Wage and salary system should have relationship with the performance, satisfaction and attainment of goals of an individual. The following elements of wage and salary system are identified by experts in HR,

a) Identifying the available salary opportunities, their costs, estimating the worth of its members of these salary opportunities and communicating them to employees.
b) Relating salary to needs and goals.
c) Developing quality, quantity and time standards relating to work and goals.
d) Determining the effort necessary to achieve standards.
e) Measuring the actual performance.
f) Comparing the performance with the salary received.
g) Measuring the job satisfaction gained by the employees.
h) Evaluating the unsatisfied wants and unreached goals of the employees.
i) Finding out the dissatisfaction arising from unfulfilled needs and unattained goals.
j) Adjusting the salary levels accordingly with a view to enabling the employees to reach goals not attained and fulfills the unfulfilled needs.

  • vivek seth

    please send your adivce on every aspect of hr on my e mail id.

    thanking you

  • anitha

    i want to know about payroll and i want to know how to prepare pay slip and leave letters and permission letter for employees please forward me answers for all these questions i will be waiting for your reply and send me all aspects of hr

    thanking you

  • anitha

    I want to become hr and i want to know all aspects of hr means how the hr should behave in the organisations how to manage employees

    thanks

    anitha

  • i want to know about payroll and i want to know how to prepare pay slip and leave letters and permission letter for employees please forward me answers for all these questions i will be waiting for your reply and send me all aspects of hr

    thanking you

    Gangadhar

  • NIRANJAN RAO

    Hi All,

    Can i get the Indian salary survey -2006 for software Industry.

    Regards,

    Niranjan

  • Mausumi

    Can i get all the rules related to leaves (working hours) that should be sanctioned by private company with only 10 employees and 50,00,000 Lacturnover

  • AMALA

    I want to know about payroll and i want to know how should i want to prepare.please send the details to my e-mail id.

    Thanking you,

  • abdalla ahmed

    i need assigment about wages& salaries can you help me.

  • upenderrao

    Please send me details of all related hr topics

  • neeha

    hi, i am an mba student doin a live project om wage and salary adm in a hospital. i am asked to revise their existing wage and salry str inorder to make it more attractive. pleae suggest me how to begin and wht needs to be done.

  • Hardik

    i m HR Executive. i need software for payroll and muster roll.

  • datta shedage

    after date of payment which days payment will do late as a rule

  • Sowmya

    I am HR & Admin Assist. I want to know about the payroll and all the activities of HR and also to know about the benckmarking in the organisation and also the behaviour of HR in the organisation.

  • Rajesh kumar

    Hi

    How are you?

    my name is rajesh kumar presently im working as a IT recruiter in HYD. i dont know how caluculate the CTC basic pay and TA,Da and ESI and PF percentages.if you know please send to me and what are the forms we want to caluculate for this CTC please let me know .

    i waiting for your reply

    Have a Good Day

    thanks

    Rajesh

  • sk raj

    This article is useful to know the basics of wages & salary mngmnt, but i feel it would be better if we would include the basic components of salary package(basic + DA +HRA etc)and how they derived, and also explanation can be given about how it differs from corporate sector (industry or IT concern) or service sector (Hospitals).

    If you have this details plz mail it to my id.

  • priya

    please send on my mail id regarding HR activities including forms,calculation of PF etc.

    Regards.

    Priya

  • vaishu

    can you please send me some information regarding payroll wages and salary on my given email id

    regards

    vaishu

  • Dinesh

    We are planning to change the Salary Structure of our company, before that we would like to see different salary structure of other companies, where we need to refer the samples.In what ways the salary structure can be changed which a employee benefits from getting exempted from Tax. If any one let me know the different components of salary which are exempt from tax can for part of a salary structure?

  • nandha

    i would like to know about the NON Taxable Salary Heads.!

    Help Me

  • Dear Sir,

    I want to know the Payroll struture, and what are deductions procedure like income tax procedure.

    thanks

    meenakshi nathan .s

  • Atul

    Hi!

    Is there anybody who tell me the excat definations of Salary & Wages. Please suggest what is the difference between Salary and Wages?

    Please advice me to my mail. Please

  • laws

  • Chetan Rathore

    In may Company, employees are given Basic+HRA+TA+MA- (PF+ESI+TDS). Now Iwant to make a software for this with the help of my IT department. So please tell me the Algorithm and flowchart for such programme.

  • md. irfan

    i want employees compensation plans and polities in indian organisations. if it possible suggest certin aspect to me. thanking you

  • niraj

    Dear Friend,

    You are correct to have an impression that Admin & HR are the least paid among all employees.

    But I am keen to know what is the percentage difference in salaries between admin,HR staff and software or technical staff.

    Specifically speaking who gets more (seniority being same) a VP HR or VP Admin or VP Tech or Vp Prod or VP Project or VP Mkt or VP Finance.

    Pl let me know as we are revising pay in our software company.

    thanx

    niraj

  • i am an HR consultant, and i would like to get all information regarding compensation, pay ranages, e.t.c, easpecially in the BPO industry, i would love to know the salary ranges in positions occupied by people in the BPO industry.

    thaks

  • What is details in salary structure

    I am HR & Admin Assist. I want to know about the payroll and all the activities of HR and also to know about the benckmarking in the organisation and also the behaviour of HR in the organisation.i dont know how caluculate the CTC basic pay and TA,Da and ESI and PF percentages.if you know please send to me and what are the forms we want to caluculate for this CTC please let me know .I want to know the Payroll struture, and what are deductions procedure like income tax procedure.

    I am waiting for your answer.

    kunal

  • SWETA

    1.Job Evaluation:

    All jobs will be analyzed and graded to establish the pattern of internal relationships. It is the process of determining relative worth of jobs. It includes selecting suitable job evaluation techniques, classifying jobs into various categories and determining relative value of jobs in various categories.

    2.Wage and Salary Ranges:

    Overall salary range for all the jobs in an organization is arranged. Each job grade will be assigned a salary range. These individual salary ranges will be fitted into an overall range.

    3.Wage and Salary Adjustments:

    Overall salary grades of the organization may be adjusted based on the data and information collected about the salary levels of similar organizations. Individual salary level may also be adjusted based on the performance of the individual employees.

    Principles of Wage and Salary Administration

    There are several principles of wage and salary plans, policies and practices. The important among them are:

    (a)Wage and salary plans and policies should be sufficiently flexible.

    (b)Job evaluation must be done scientifically.

    (c)Wage and salary administration plans must always be consistent with overall organizational plans and programs.

    (d)Wage and salary administration plans and programs should be in conformity with the social and economic objectives of the country like attainment of equality in income distribution and controlling inflationary trends.

    (e)Wage and salary administration plans and programs should be responsive to the changing local and national conditions.

    (f)These plans should simplify and expedite other administrative processes.

    The Elements of Wage and Salary System

    Wage and salary system should have relationship with the performance, satisfaction and attainment of goals of an individual. The following elements of wage and salary system are identified by experts in HR,

    a)Identifying the available salary opportunities, their costs, estimating the worth of its members of these salary opportunities and communicating them to employees.

    b)Relating salary to needs and goals.

    c)Developing quality, quantity and time standards relating to work and goals.

    d)Determining the effort necessary to achieve standards.

    e)Measuring the actual performance.

    f)Comparing the performance with the salary received.

    g)Measuring the job satisfaction gained by the employees.

    h)Evaluating the unsatisfied wants and unreached goals of the employees.

    i)Finding out the dissatisfaction arising from unfulfilled needs and unattained goals.

    j)Adjusting the salary levels accordingly with a view to enabling the employees to reach goals not attained and fulfills the unfulfilled needs. ( hi i am also prepering Same project so if you have some suggession plz send it to me)

  • sweta

    hi

    this is sweta & i am student of B.B.A vth semester student there is not proper environment to learn about HR. as i just completed my Industrial trainning from the Hotel ( ananda in the himalya). I learn a lot but now i have to prepare a project report on the topic of “wage & salary Administration” i have almost data about this topic but still i have to arange it properly so can you help me to complete this project because except my teacher, no body here, to whome i can ask about the HR & i want to make it best.

    so can you tell me what kind of more information i have to collect from the organisation.
    asap

  • surendra ghanekar

    hi

    i want know the information of human resouce management course, fees, duration of course & scope

  • Edward

    Can i get the Indian salary survey -2007 for

    Non-profit organisation?

  • kiran.a

    I want to know about payroll and also i want to know how to prepare.Can u please send the details to my e-mail id.Also I want to know abt how to calculate ESI & PF.

    Thanking you,

  • manish rai

    hello to all, actually i have just entered in HR world, so i am not aware about the salary structure. how we can create salary structure, which component should be claimed at particular time.

    please send me your suggestion on my email-ID.

  • please declare 6th pay commission as early as possible and please be effect from 01 Jan 2006

    With regards

    Balkar Singh

  • information abt wage & salary administration

  • mariam

    send your advice on evreryaspect of hr on my email id also how the hr should behave in the organizations how to manage employees

  • Ruchi

    hi,

    I want to get in HR, so that now i m pursing pg diploma in personnel management and labour law from himachal universiy.

    Just want to know that will it good path to get my destination.

    Thanks & Regards

    Ruchi Sharma

  • P.D.

    We are planning to change the Salary Structure of our company, before that we would like to see different salary structure of other companies for reference.In what ways the salary structure can be changed which a employee benefits from getting exempted from Tax. If any one let me know about the role of gratuity in tax relaxation ?

  • Give me Information of Payroll.

  • vipul

    i want a theory of pay roll system of any salt company for my mba project please help me out

  • Ashok patil

    We are a Govt department India Security Press ,Nashik ,Currency Note Press working under ministry of Finanace .As a part of LPG we have been corpotasied and as General Secretary Of Staff Union I want help for the salary and other benifits like pension etc restructuring.We are ready to hire a consultent for this prupose urgently.Please reply.

  • raj

    What is the diffrence between salary 7 WAGES

  • i need more details on this chapter can you help me

  • sampath.k

    can you please send me some information regarding payroll wages and some salary slip format on my given email id.

  • dinesh.c

    hi

    this is dinesh.i am a student doing my B.COM in joseph college ,i have been given project on “salary fixation for different levels ”. i have certain data but i want information to be clear, so can u help me sending the content to my mail

  • thambu

    hi ,

    i like to know about the companies providing high initial salary to freshers

  • vishal

    I know the preparation of PF Challan if the basic wages does not exceed Rs. 6500, but i dont know how to prepare the Challan & other records
    if basic wages exceeds Rs. 6500 per month.

  • EMMA ENEANYA

    Great piece of work, very helpful. What happens where Salary is indiscriminately paid without due recourse to experience, skill, competence etc?