Compensation Management1[2]

8/2/2019 Compensation Management1[2]

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CompensationManagement


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Job Evaluation flows from JOB ANALYSISProcess & uses JOB DESCRIPTION as itsbase. Job Description is examined by

comparing:

Relative importance of the job

Relative skills needed to perform thejob

Difficulty of one job compared toother jobs


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Internal job worth through JOBEVALUATION MARKET PRICING:

Pay set by other employers is anaccurate reflection of a jobs worth

Jobs are same in anotherorganization

Economic condition not

considered(impact) Employer size not considered


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Ranking Method

Places Jobs in order ranging, Lowestto highest value

Entire job considered More Thanindividual components.

More useful for small Organization

Large number of job increasesubjectivity


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Classification method

Gather information from J.D. &J.S.

Separate jobs intotypes(sales,operations,accounts,clerical).

List Out Common Feature to all. Place in appropriate Classification.


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Point Method

Most widely used.

Sophisticated.

Focus on component.

Weight age in logical.

More Objectivity.

Compensation is Fair.


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FACTOR COMPARISON

Bench mask Jobs are Categorizedaccording to levels of Responsibility,

Knowledge, Skills, WorkingConditions Etc.

Comparisons of Direct indirect jobs

in organization is made. Market rateof pay ins assigned to the particular

job


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HAY PLAN-used to exemptemployees

Focus factors, key issues

Problem solving

Accountability

Know how(practical application)


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ADVANTAGES

Tells real worth of the job

Factors values easily converted to

monetary values Most widely used


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DISADVANTAGES

Cant be used as tailor made

Need to consult specialist

Reference to comparison methodand manuals is essential

Time consuming

Requires regular review


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Wages and salary survey

Information available throughnational survey,bureau of labour

statistics,national chambers ofindustries

Fresh and specific surveys are also

undertaken Listing of compatible organization

and job responsibility is important


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ISSUES TO BE ADDRESSED

Is the survey a realistic sample ofemployers, or is it dominated by a fewlarge employers?

Is the data provided by other personnelspecialists, not individual operatingmanagers?

How old is the information?

How sound and experienced is theorganization that prepared the survey?


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SAMPLE FACTOR COMPARISON CHART,DANBO

MANUFACTURING CORPORATION


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POINT METHOD CHARTS


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PAY SCATTERGRAM


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EXAMPLE OF PRICED LABOUR GRADE

Documents

Compensation Management1[2]