Emplyoeee Comensation Kavita Project

7/29/2019 Emplyoeee Comensation Kavita Project

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A PROJECT

ON

Employee Compensation and Benefits atFast Track Software Pvt.Ltd

BY

Upasna Pandey

UNDER THE GUDIANCE OF

Submitted to

University of Pune

In partial fulfillment of award of recognition of

Masters of Personnel Management (MPM)

Through

Asian School of Management Pune


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ACKNOWLEDGEMENT

I take an immense pleasure in submitting this report on Employee compensation and

Benefits successfully. It helped me to check the feasibility of the theories learnt in

me academic course.

It is indeed a moment of great pleasure and immense satisfaction for me to express a

sense of profound gratitude to all those people who have in making this project an

enriching experience.

I am very thankful to the respected HOD.. and the project

guide and all the staff members who inspired me and provided

continuous help and attention during the project.

I express my sincere acknowledge to them.


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Certificate from institute


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Certificate from company


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INDEX

Chapter No. Title Page No.

Executive Summary

Company Profile

The fast track story

Strengths

Core Values

Services

Objective and scope of the study


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EXECUTIVESUMMARY

Organizations offer a wide range of traditional and nontraditional benefits. In the past,

the dilemma for organizations was how to offer the right mix of these benefits to

attract and retain top performers while also balancing increasing costs of benefits.

Today, organizations are managing these ever-increasing costs amidst the uncertainty

of the economy. Given that the benefits allocation in HR budgets is typically fixed, or

marginally flexible, it is not surprising that according to this research, employers

continue to remodel their benefits plans to give employees greater responsibility to

manage their health care costs, retirement and financial security, and leave.

This project is about the Employee Compensation and Benefits done at the Fast Track

Software Pvt. Ltd. The report includes a brief overview, objective of the study and

then the importance of the study has been elaborated. This report further contains the

research methods, data collection process and the analysis and interpretation of the

data. The report has been concluded with findings, conclusions and recommendations.


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On a personal note this project was a great learning experience as far as compensation

and benefits of the employees is concerned.

COMPANY PROFILE

The Fast Track Story

Fast Track was started in 1999 by its President, Brian Conte, a quintessential

entrepreneur and world-class software engineer who came out of the Windows OS

group. Brian has a demonstrated ability to start small, work smart, and make real

money in a tough landscape.

A graduate of Princeton University, Conte was among the early employees of

Microsoft. He managed the development of Microsoft's first browser and was the

architect and developer of the early Microsoft Multimedia Browser and lead

developer for Windows and OS/2 hardware adaptations.

Conte also served as a senior software engineer for Microsoft for four years. Fast

Track's founder, Brian Conte, was one of the original developers of Windows at

Microsoft, and has since managed the development of over 50 product releases. His

products have been used by millions of people and have won numerous awards,

including Product of the Year twice.

As Founder & CEO of HDC/Express Systems from 1987 to 1996, Conte invented a

number of award-winning products, including Power Launcher, the inspiration for

Windows' Start Menu. In the face of a contracting and consolidating marketplace for

such utilities, Conte grew the renamed business (Express Systems) again into a leader

in its field and successfully negotiated its purchase by WRQ.


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When the company changed hands, Conte remained with WRQ as CTO from 1996 to

1999. Brian spearheaded the development of one of WRQ's most successful

products, Express 2000, which generated more than $10 million in its first year.

Conte supervised a team of 35 developers and was the chief inventor of two U.S.

patents.

In 2002, Fast Track opened a development office in India called Fast Track Software

Services Pvt. Ltd. The India office has grown from 3 to 60 people.

In 2003, Fast Track began working with Microsoft on a number of projects, including

Imagine Cup and Dream Spark, two of Microsofts largest and best known student

programs. At this time, the Fast Track team became a preferred Microsoft vendor.

In 2006, Conte designed and developed Fast Track's Home Automation product line,

which won Electronic House's 2006 "Best Home of the Year" award in its debut year

and was featured on the Discovery Channel and the Oprah Winfrey show.

Most recently, Fast Track opened a sales and support office in Cebu, Philippines in

January, 2012. The office currently employs seven people. In November 2012, Fast

Track shipped its first product, Power Site, a web site builder for small businesses and

designers. Also in 2012, Fast Track became a Microsoft Gold Partner, the highest

partnership level that can be achieved with Microsoft. The company currently

employs 75 people across four offices.

Fast Track: Fast, Innovative, Smart, Proven, Professional

Fast Track creates cutting edge websites and web applications for businesses of all

sizes faster and better than anyone else in the business. We are a recognized,

innovative expert in the development of Microsoft technology applications and one of

leading developers of mobile, tablet and web applications utilizing .NET technology.


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Our unique background in allows us to deliver high quality results in a cost effective

way to increase your competitive advantage.

Our solutions range from a very simple website to large, complex applications that

operate high traffic environments. And, we offer a complete range of development

services - from business analysis, software design and prototyping to software

development, QA services, post-project maintenance and support.

Our goal is to accelerate your internet business success by providing you with the

fastest, most technically advanced web tools in the business. We offer you a

professional, knowledgeable team expertly skilled in the latest internet technologies.

When you work with us, youll access a full package of internet services, including

design, development, marketing, technical support and hosting. We deliver

exceptional customer value through high quality services, constant innovation and

creative solutions.

At Fast Track, we produce user-friendly websites and applications tailored to your

business needs. Our solutions focus on increasing your online presence and revenue.

With over 100 years of combined IT experience, weve worked with all types of

clients---from startups to large corporations, nonprofit organizations to small

companies and everything in between. We take the time to understand your

particular needs and deliver real solutions that are intelligent and seamless.


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Our Strengths

From the start, weve specialized in Microsoft technology. Weve created major

websites and applications for Microsoft. We excel in being faster, more streamlined

and more economical than our competition.

Core Values

Innovative

Knowledgeable

Expert

Efficient

Helpful

Useful

Passionate

Genuine


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Fast Track provides a full range of web and application services:

Web Design and Development

Custom Websites

Web Application Development

Content Management Systems

Ecommerce Websites

Enterprise Portal Development

Third-party integration

Custom Software Development

Open source application

Customization

Software QA Consulting

Full Lifecycle Process Improvement

QA Process Consulting

Test Strategy Elaboration and Management

Search Engine Optimization

Website Review and Analysis


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Website Optimization

SEO Plan Deliverables

Enterprise Mobility Solutions

Application Maintenance

Mobile Web Development

By platform for IOS, Android,

Windows and Blackberry

Offshore Software Development

Software Outsourcing

Custom Software Development

Software Migration

Software Testing

Dedicated Software Development Teams

Quality Assurance

Accessibility Testing

Compatibility Testing

Performance Testing

Installation/Configuration Testing

System/Integration Testing

Security Testing

Internationalization/Localization Testing

Project Assessments


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Code Evaluations

Solutions

Microsoft .NET

Windows Azure

Custom CMS

HTML 5

Windows Phone

Entity Framework

Linq

CSS 3

CSP/MSCOM

Microsoft SQL Server

Microsoft Silverlight

Microsoft Project Sharepoint

Microsoft Project

Verticals We Serve

Banking

Communications

Consumer Goods

Energy

Utilities

Healthcare

IT

Media

Entertainment

Insurance

Manufacturing

Retail

Technology

Travel


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OBJECTIVES OF STUDY

To analyze the various forms of compensation and benefits provided to the

employees.

To examine the compensation and benefits forms that boost the interest of the

employees to work.

To examine the perception of employees on current pattern of compensation and

benefits.

To know if the equity parameters are met by the organizations in the industry

To understand employee compensation and benefits of various organizations in

the Semiconductor sector.

To know the expectations of the employees on Compensation and Benefits in the

times to come

SCOPE OF STUDY

The study aims to gain an insight of compensation and benefits offered to the

employees. An effort is made to analyse the satisfactory level of respondent

employees towards various factors of compensation and benefits.


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RESEARCH METHODOLOGY

Statement of Problem

Employee compensation is an important determinant of employee satisfaction.

Knowing what the employees actually want in terms of the benefits and perks offered

by the employers, in addition to fair and adequate pay is crucial to satisfy and retain

the key talent in any organization. Compensation has to be fair and equitable among

all employees in the company (internal equity) as well as in comparison to the

external market (external equity).

The study is taken up to analyze the perception of employees towards the current

pattern of Compensation, the satisfactory level of employees on various forms of

compensation and their expectations on the pattern of compensation in times to come ,

for the betterment of the employees. Methodology is the section of a research

proposal in which the methods to be used in the present study are described. The type

of study is behavioral in nature. The methodology of study used in the study is

descriptive where it includes surveys and fact finding formats.

Sources of data

The present study is mainly based on primary data. Secondary data is also taken into

consideration where ever necessary.

Primary Data

The primary data is collected through structured questionnaires. Responses were

obtained from 50employees from the organization.


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Secondary Data

The secondary data collected includes review of the existing literature of employee

compensation and benefits from various text books, internet sources and journals to

get an understanding of the concepts related to the study.

Methods of Sampling

Convenience sampling is used in getting an approximation of the truth. This non

probability method is used during research efforts to get an estimate of the results, in

order to overcome the cost or time constraints required to select a random sample.

Judgment sampling This is an extension of convenience sampling. The entire sample

is from one "representative" city (Bangalore), even though the population includes

other cities.

The Sample

For the present study, data was collected with the help of structured questionnaires

from 80 technical employees from four organizations. The respondent employees,

twenty each, are taken from the following four companies in the Semiconductor

industry.

Data Collection

The tools used for data collection are structured questionnaires distributed to the

respondents through emails, as preferred by the respondents who are technically

equipped.


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PROJECT WORK UNDERTAKEN IN THE ORGANISATION

Human Resource is the most vital resource for any organization. It is responsible for

each and every decision taken, each and every work done and each and every result in

the Organization. The successful management of an organization's human resources is

an exciting, dynamic and challenging task, especially at a time when the world has

become a global village and economies are in a state of flux. The scarcity of talented

resources and the growing expectations of the modern day employees have further

increased the complexity of the human resource function. Even though specific

human resource functions/activities are the responsibility of the human resource

department, the actual management of human resources is the responsibility of all the

managers in an organization It is therefore necessary for all managers to understand

and give due importance to the different human resource policies and activities in the

organization. Human Resource Management outlines the importance of HRM and its

different functions in an organization. It examines the various HR processes that are

concerned with attracting, compensating, managing, motivating and developing

employees for the benefit of the organization. Employees should be managed properly

and motivated by providing best remuneration and compensation as per the industry

standards. The lucrative compensation will also serve the need for attracting and

retaining the best employees.

Compensation

Compensation is the remuneration received by an employee in return for his/her

contribution to the organization. It is an organized practice that involves balancing the


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work-employee relation by providing monetary and non-monetary benefits to

employees. Compensation is an integral part of human resource management which

helps in motivating the employees and improving organizational effectiveness.

Nature of Compensation

Employee compensation offered by an organization involves various forms of pay and

rewards going to employees and arising from their employment. A Compensation

package includes Direct Financial Payments through base pay and variable pay and

indirect payments through benefits and incentives. This ensures equal pay for equal

work i.e. each individuals pay is fair in comparison to others doing the same or

similar jobs.

Base Pay

It is the basic compensation an employee gets usually as a wage or salary. Base pay is

based of the role in the organization and the market for the expertise required

conducts that role.

Variable pay

It is the compensation that is linked directly to performance accomplishments.

Variable pay is based on the performance of the person in that role, for example, for

how well that person achieved his or her goals for the year.

Benefits

These are indirect rewards given to an employee or group of employees as a part of

org benefits are employer provided rewards and services other than wages and

salaries. These benefits are provided for various reasons:

1. Keep salaries low and hence obtain tax benefits.

2. Make the salary package competitive to recruit and retain talent.

3. Act as motivators


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4. Ensure long term employment as some benefits are linked to time spent in an

organization. Organizational membership (health insurance, vacation pay, retirement

pension etc).

Need for Compensation Management

Fair Compensation

Compensation Management is needed to design pay structure that will attract,

motivate and retain competent employees, that is also viewed as fair by the

employees.

Inclusion of Benefits

Salary is just a part of the compensation system, the employees have other

psychological and self-actualization needs to fulfill. Thus, benefits are included to

serve the purpose.

Reward desired behavior

Compensation should reinforce desired behavior through increments and rewards and

act as an incentive for the behavior to occur again. Similarly withholding increments

for poor performance will ensure that the employee puts in more efforts. For example:

Many organizations appreciate the employee effort though Thank you cards for the

effort they have put in for the month. This invokes a sense of healthy competition

among employees and a positive work spirit. Also the methods of Star of the month

which rate the productivity and efficiency enable measuring the employee efficiency.

Employee

Retention

NeedSatisfactio

n

Motivation

Compensation

Package


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DRIVERS OF COMPENSATION

The following factors influence the shaping of compensation package:

Market research about the worth of similar jobs in the marketplace,

Employee contributions and accomplishments,

The availability of employees with like skills in the marketplace

The desire of the employer to attract and retain a particular employee for the

value they are perceived to add to the employment relationship, and the

profitability of the company or the funds available in a non-profit or public sector

setting, and thus, the ability of an employer to pay market-rate compensation.

Components of Compensation System

Compensation systems are designed keeping in mind, the strategic goals and business

objectives. Compensation system is designed on the basis of certain factors after

analyzing the job work and responsibilities. Components of a compensation system

are as follows:

Fig: Components of Compensation

Salary

Surveys

Pay

Structures

Job

Analysis


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Job Analysis

Job Analysis helps in finding out the abilities or skills required to do the job

efficiently. A detailed study of the jobs is usually mad e to identify the qualifications

and experience required for them. Job Analysis can be used in compensation to

identify or determine:

Skill levels

Compensable job factors

Work environment (e.g., hazards; attention; physical effort)

Responsibilities (e.g., fiscal; supervisory)

Required level of education (indirectly related to salary level)

Pay Structures

A companys pay structure is the method of administering its pay philosophy. The

two leading types of pay structures are the internal equity method, which uses a

tightly constructed grid to ensure that each job is compensated according to the jobs

above and below it in a hierarchy, and market pricing, where each job in an

organization is tied to the prevailing market rate. A pay structure helps answer

questions about whos who, what each persons role is, and why people are

compensated differently. It also helps human resources personnel to fairly administer

any given pay philosophy. For example, a company might want to pay everyone at

market; or pay some people at market and some above it. Opportunities for incentives

are also dealt with in the pay structure. For example, people with strategic roles will

likely have opportunities for higher incentives.

Salary Survey

The Salary survey is the research done to analyze the industry standards to set up the

compensation strategy for the organization. Organizations can either conduct the


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survey themselves or they can purchase the survey reports from a reputed research

organization. These reports constitute the last 2-5 years or more compensation figures

for the various positions held by the organizations.

Objectives of Salary Survey

To gather information regarding the industry standards.

To design a fair compensation system.

To design and implement most competitive reward strategies.

To benchmark the compensation strategies

To know more about the market rate i.e. compensation offered by the

competitors.

Types of Compensation Surveys

There are two types of compensation surveys undertaken by the organizations.

Fig: Types of Compensation Survey

Standard Surveys

Standard surveys are undertaken by organizations on a regular basis. These surveys

are conducted annually based on the organizational objectives. These surveys attempt

to cover the same companies every year and provide the same time of analysis. The

reports are published annually by the research organizations. The organizations


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willing to formulate their compensations strategies based on the surveys purchase the

reports from the research organization.

Custom Surveys

At times, a few organizations need to know some specific information. The surveys

which cater this need are known as custom surveys. The organizations either resort to

higher research organizations to conduct theses surveys for them or they themselves

conduct the survey by sampling few of the competitors on their own. These surveys do

not have any time interval. They are undertaken as the need arises. They focus on

importantissues usually one or two.

Survey Reports

The survey reports consist of the analysis and conclusion drawn from the evaluative

data based on the objectives of the study. The reports also include the data, facts and

figures to support the analysis and conclusion. The supportive data and annexure

provided in the report form the basis for the un-biased conclusion and validation of

the analysis.

COMPENSATION SYSTEMS

Strategic Compensation

Compensation strategy is derived from the business strategy. The business goals and

objectives are aligned with the HR strategies. Then the compensation committee or

the concerned authority formulates the compensation strategy.

It depends on both internal and external factors as well as the life cycle of an

organization.


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Fig: Evolution of Strategic Compensation

Traditional Compensation Systems

In the traditional organizational structures, employees were expected to work hard and

obey the bosses orders. In return they were provided with job security, salary

increments and promotions annually. The salary was determined on the basis of the

job work and the years of experience the employee is holding. Some of the

organizations provided for retirement benefits such as, pension plans, for the

employees. It was assumed that humans work for money, there was no space for other

psychological and social needs of workers.

Change in Compensation Systems

With the behavioral science theories and evolution of labour and trade unions,

employees started asking for their rights. Maslow brought in the need hierarchy for t

he rights of the employees. He stated that employees do not work only for money but

there are other needs too which they want to satisfy from their job, i.e. social needs,

psychological needs, safety needs, self-actualization, etc. Now the employees were

being treated as human resource. Their performance was being measured and

appraised based on the organizational and individual performance. Competition

among employees existed. Employees were expected to work hard to have the job

security. The compensation system was designed on the basis of job work and related

proficiency of the employee.

Todays Modern Compensation Systems


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Today the compensation systems are designed aligned to the business goals and

strategies. The employees are expected to work and take their own decisions.

Authority is being delegated. Employees feel secured and valued in the organization.

Organizations offer monetary and non-monetary benefits to attract and retain the best

talents in the competitive environment. Some of the benefits are special allowances

like mobile, companys vehicle; House rent allowances; statutory leaves, etc.

Equity Theory

Employees want to be treated fairly. Equity is the balance between the inputs the

individual brings to a job and the outcomes he or she receives from it. Employee

inputs include skills, experience, education, special skills, effort and time worked.

Outcomes include pay, benefits, achievement, recognition and any other rewards. The

individual special skills and efforts are weighed against the pay and recognition paid

by the organization. However inputs and outcomes are in different units and are hard

to compare with each other directly. Thus equity theory suggests that individuals

determine whether they are being treated fairly by comparing their own outcomes.

Three elements of equity can be distinguished, internal, external and an individual.

Internal Equity

Internal equity refers to the relationship among jobs within a single organization. It

exists when the employee pay differentials between different jobs within in the

organization are perceived as fair neither too large not too small. This ensures that

more difficult jobs are paid more.


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Fig: Internal Equity

External Equity

External equity refers to comparison of similar jobs in different organizations of the

same Industry. This ensures that jobs are fairly compensated in comparison to similar

jobs in the market. Here the market pricing analysis is done. Organizations formulate

their compensation strategies by assessing the competitors or industry standards.

Organizations set the compensation packages of their employees aligned with the

prevailing compensation packages in the market. This entails for fair treatment to the

employees. At times organizations offer higher compensation packages to attract and

retain the best talent in their organizations.


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Fig: External Equity

Individual Equity

Final element individual equity refers to comparison among individuals among the

same job with the same organization.

Types of Compensation

A Compensation package includes Direct Financial Payments through base pay and

variable pay and indirect payments through benefits and incentives. This ensures

equal pay for equal work i.e. each individuals pay is fair in comparison to others

doing the same or similar jobs.

Direct Compensation

Direct compensation refers to monetary benefits offered and provided to employees in

return of the services they provide to the organization .


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Basic Salary

Salary is the amount received by the employee in lieu of the work done by him/her for

a certain period say a day, a week, a month, etc. It is the money an employee receives

from his/her employer by rendering his/her services.

House Rent Allowance

Organizations either provide accommodations to its employees who are from different

state or country or they provide house rent allowances to its employees. This is done

to provide them social security and motivate them to work.

LeaveTravel

Allowance

Bonus

SpecialAllowance Basic Salary

House RentAllowance

MedicalReimbursement

Conveyance

Direct

Compensation


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Conveyance

Organizations provide for cab facilities to their employees. Few organizations also

provide vehicles and petrol allowances to their employees to motivate them.

LeaveTravelAllowance

These allowances are provided to retain the best talent in the organization. The

employees are given allowances to visit any place they wish with their families. The

allowances are scaled as per the position of employee in the organization .

Medical Reimbursement

Organizations also look after the health conditions of their employees. The employees

are provided with medi-claims for them and their family members. These medi-claims

include health-insurances and also medical treatment bills reimbursements.

Bonus

Bonus is paid to the employees during festive seasons to motivate them and provide

them the social security. The bonus amount usually amounts to one months salary of

the employee.

Special Allowance

Special allowance such as overtime, mobile allowances, meals, commissions, travel

expenses, reduced interest loans, insurance are provided to employees to provide them

social security and motivate them which improve the organizational productivity.

Indirect Compensation

Indirect compensation refers to non-monetary benefits offered and provided to

employees in lieu of the services provided by them to the organization.


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Figure showing Forms of Indirect Compensation

Overtime Policy

Employees should be provided with the adequate allowances and facilities during

their overtime, if they happened to do so, such as transport facilities, overtime pay,

etc.

Hospitalization

HolidayHomes

FlexibleTimings

RetirementBenefits Leave Travel

Insurance

Hospitalization

OvertimePolicy

Indirect

Compensation


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The employees should be provided allowances to get their regular check-ups, say at

an interval of one year. Even their dependents should be eligible for the medi-claims

that provide them emotional security and social security as well.

Insurance

Organizations also provide for accidental insurance and life insurance for employees.

This gives them the emotional security and they feel themselves valued in the

organization.

Leave Travel

The employees are provided with leaves and travel allowances to go for holiday with

their families. Some organizations arrange for a tour for the employees of the

organization. This is usually done to make the employees stress free.

Retirement Benefits

Organizations provide for pension plans and other benefits for their employees which

benefits them after they retire from the organization at the prescribed age.

Holiday Homes

Organizations provide for holiday homes and guest house for their employees at

different locations. These holiday homes are usually located in hill station and other

most wanted holiday spots. The organizations make sure that the employees do not

face any kind of difficulties during their stay in the guest house

Flexible Benefit Plan

Flexible benefits plans, also called cafeteria plans, are arrangements in which

employees tailor their benefits package to their specific needs. It is a benefits plan that

allows employees to select from a pool of choices, some or all of which may be tax-

advantaged.


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Employees can select the benefits they value most and may forgo benefits of lesser

importance to them. Potential choices include cash, retirement plan contributions,

vacation days, and insurance.

Under a flexible arrangement, an employer allocates a specified amount of money to

each employee to 'purchase' benefits. In this way, the employers control the amount

they spend on each employee for benefits, while the employee selects the benefits.

This method differs from a traditional benefits programme, in which an employer

offers a standard package with few, if any, choices to employees.

Incentive Plans

Organizations can opt for an effective incentive plans from the various alternatives

available. The organizations usually opt for that incentive plans which suits its

requirement the most. As incentives covers the financial matters, organizations need

to be very focused in choosing the best alternative that is in alignment to the business

goals and objectives. The various forms of incentive plans are:

Figure: Incentive Plans

LoyaltyPay

GainSharing

MaturityCurves

StandardHour Pay

MeritRaises

Bonus

Incentive

Plans


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Bonuses

Bonuses are given to employees on a pre established goal or criteria. The

organizations set policies regarding the bonuses. Usually bonuses are provided during

the festive season.

Merit Raises

Merit raises are given on the basis of predetermined policies. The employees are

given raise on the basis of their performance. The performance standards are set by

the organizations much in advance.

Standard Hour Pay

Standard hour plan provides incentives to employees based on the time saved by them

during the job course. Employees productivity and quality is evaluated with respect

to the set standards.

Maturity Curves

Maturity curve incentive plan considers the experience and performance of an

employee for giving out the incentives. It is practiced in all the industries. Experience

is always given a weight-age as experienced people can produce better quality results.

Gain Sharing

Gain sharing incentive plans undertake those employees who give outstanding

performances and provide for cost saving measures. Organizations believe in sharing

the profits with the employees who are responsible for producing those results.

Loyalty Pay


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Pay for loyalty is an incentive plan that helps to retain loyal employees of the

organization. Loyalty pay involves the payment of a sum of money, say, one months

additional salary, to the employees working for more than certain minimum years in

the organization.

Features of Effective Compensation Policy

An effective compensation plan takes care of legal stipulations, industry practices,

ever rising employee expectations and competitive pressures.

A compensation policy is effective if compensation and benefits are:

Adequate

In line with what is paid in similar companies in the same geographical area.

Balanced

A reasonable combination of direct and indirect benefits.

Equitable

Commensurate with the effort put in and the ability used.

Incentive

Sufficient incentives are needed to motivate the employees to work effectively.

Secure

Sufficient to satisfy the employees basic need and make him feel secure.

Cost effective

What the organization can afford to pay. A rational compensation plan helps attract

and retain employees at a reasonable cost. Without proper structure the organization

may overpay or underpay the employees.


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ANALYSIS AND INTERPRETATION OF THE DATA

Introduction

Keeping in view, the objectives of the study, the data collected through the

questionnaires is analyzed and interpreted with the help of the statistical tabulation

method. Statistical tools such as percentages, ANOVA (two way classification),

Likert scale, diagrams and graphs are used to test and interpret the findings.


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Satisfactory level of employees regarding compensation based on qualification

Levels Qualifications

Number of employeesPercentage ofemployees

Most Satisfactory 3 6

Satisfactory 30 60

Neutral 12 24

Dissatisfactory 5 10

Most Dissatisfactory 0 0

Total 50 100


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Inference

60% of the respondent population is satisfied with the current compensation package

based on their qualification. The response shows that 24% of the respondents gave

neutral rating, where as 10% are dissatisfied. It is inferred that majority of the

respondents are satisfied with the current compensation, taking their qualification into

account. However, a significant percentage of respondents.

Satisfactory level of employees regarding compensation based on experience

Levels Experience

Number of employeesPercentage ofemployees

Most Satisfactory 2 4Satisfactory 25 50

Neutral 14 28

Dissatisfactory 9 18

Most Dissatisfactory 0 0

Total 50 100


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Inference

50% of the respondent population is satisfied with the current compensation package

based on their experience. The response shows that 28% of the respondents gave

neutral rating, whereas 18% are dissatisfied. It is inferred that half of the respondent

population is satisfied with the current compensation, taking their experience into

consideration. However a more percentage of employees are dissatisfied with the pay

based on their experience, than that on qualification.

The Organizations pay policy is clear, related to the salaries, pay and bonus

OptionNumber ofemployees

Percentage ofemployees

Yes 46 92

No 4 8

Total 50 100


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Inference

92% of the respondents accept that the organizations pay policy, related to the

salaries, pay and bonus is clear to them whereas 8% respondents do not feel that the

organizations pay policy, related to the salaries, pay and bonus is clear.

A clear pay policy makes the employer-employee relation transparent and enhances

mutual understanding. It is inferred from the above graph that the pay policy is clear

to majority of the respondents.

Presence of belief in employees on performance based payment system

OptionNumber ofemployees


Yes 46 92

No 4 8

Total 50 100


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Inference

92% of the respondents show belief in the performance based payment system. 8% do

not believe in the performance based payment system. One of the reasons is that

performance based payment system involves the rating given to the employees by the

managers who may be partial to some extent. Also quantifying the performance is a

subjective process which may lead to differentiation among the employees

The Organization provides pay in accordance with the responsibilities handled

Level of agreementNumber ofemployees


Strongly Agree 2 4

Agree 25 50

Neutral 13 26

Disagree 8 16

Strongly disagree 2 4Total 50 100


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Inference

50% of the respondent population agrees that their pay is in accordance with the

responsibilities they handled. 4% of the respondents strongly agree to it, where as

16% and 4% of the respondent population disagree and strongly disagree

respectively.26% of the respondents show neutral remarks.

It can be inferred that the opinions in reaction to this query varies among half of the

respondents.

Willingness of the respondents to take additional responsibility, if the

compensation is increased

Option Number of employeesPercentage ofemployees

Yes 36 72

No 14 28

Total 50 100


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Inference

72% of the respondents are willing to take additional responsibilities, if the

compensation is increased. 28% of the respondents are not willing to take up

additional responsibilities, even if the compensation is increased.

It can be inferred that compensation alone is not sufficient to please the employees .

Existence of bias in the compensation package of similar jobs within the

Organization

Option Number of employeesPercentage of

employees

Yes 42 84

No 8 16

Total 50 100


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Inference

84% of the respondents express that bias exists in the compensation package of

similar jobs within the Organization. Only 16% of the respondents do not think that

bias exists.

From this chart, it can be inferred that majority of the employees do not feel that

internal equity is met in the organizations.

The Compensation package is at par with package of similar jobs in other

Organizations in the Industry


employees

Strongly agree 1 2

Agree 25 50

Neutral 13 26

Disagree 8 16

Strongly disagree 3 6

Total 50 100


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Inference

50% of the employees agree to the statement, where as the 26% of respondents are

neutral. Only 2% of the respondents strongly agree to it. On the contrary, 6% disagree

strongly.

It can be inferred that half of the respondents agree that their companys pay package

is at par with the industry standards, which means external equity is met.

Salary is provided in one of the following weeks, every month by the

organization

Weeks of the month Number of employeesPercentage of

employees

First week 41 82


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Second week 0 0

Third week 0 0

Fourth week 9 18

Total 50 100

Inference

82% of the respondents are paid in the first week of every month; where as

18% of the employees are paid in the fourth week of every month.

The salary paid regularly in the same time every month


employees

Yes 50 100

No 0 0

Total 50 100


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Inference

All the respondents receive monthly salary regularly in the same time every month.

This implies that the Organizations pay the employees regularly

The following factors would boost the employees interest in work


employees

Increments 42 84

Better amenities by theorganization 26 52

Scope of Advancement 31 62Better working conditions 27 54


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Better work life balancefacilities 37 74

Inference

Increments boost the interest of the majority of the respondents, followed by better

work-life conditions, then by scope of advancement. More than half of the

respondents look for better amenities by the organization and better working

conditions.

Specifically, the level of satisfaction with the following:

Factors Increments

SickLeavePolicy

MedicalBenefitScheme Incentives Insurance

MostSatisfactory 2 10 8 6 18

Satisfactory 9 30 31 8 22

Neutral 26 9 9 22 6

Dissatisfactory 10 1 2 9 4


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MostDissatisfactory 3 0 0 5 0

Inference

More than half of the respondent population is neutral towards increments. Majority

of the respondents show satisfaction towards the sick leave policy, medical benefit

scheme and the insurance. Satisfactory level of employees is high in case of Sick

Leave Policy and Medical Benefits. Response is evenly spread across the three

satisfactory levels in case of Incentives. Dissatisfactory level is high in case of

increments.

Would like to recommend any changes in the current Compensation and Benefits

package in the Organization


employees

Yes 23 46

No 27 54

Total 50 100


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Inference

46% of the respondents would like to recommend changes in the current compensation

and benefits package.54% of the respondents would not recommend changes to the

current compensation package.

Summary of Findings, Conclusion and Recommendations

Findings

Majority of the respondents are satisfied with the compensation based on

qualification.


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Majority of the respondents are satisfied with the compensation based on

experience.

Most of the respondents felt that the organizations pay policy is clear, related

to the salaries, pay and bonus.

Almost all the respondent employees believed in performance based

compensation system.

Fifty percent of the respondents agreed that the Organization they work for

provides pay in accordance with the job responsibilities they handle.

More than half of the respondent population is willing to take additional

responsibility, in case the compensation is increased.

Three fourths of the respondents feel that there exists bias in the compensation

package of similar jobs within the organization.

The salary is paid to the employees in the first week to the majority of the

employees and to the rest of the respondents in the fourth week.

Of all the following factors,

Increments

Sick Leave Policy

Medical Benefit Scheme

Incentives and

Insurance Policy

Increments boost the interest of most of the employees.

Nearly half of the respondent population considers the need to make changes

in the existing compensation and benefits package in their respective

Organizations.


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Conclusion

Todays compensation systems have come from a long way. The results of the study

indicate that with the changing organizational working patterns and employee needs,

there is a need to bring in changes in the compensation systems.

The organization needs to provide competitive compensations to their employees,

taking into account, the higher education qualifications, experience and higher skills

required for the jobs.

Further the study reveals that perfect compensation system, with properly designed

features like loyalty pay and Flexible Benefit Plan along with timely increments, and

performance incentives, provides platform for happy and satisfied workforce.

The workforce not only looks for monetary benefits, but also looks forward to various

aspects like wok-life balance facilities, better amenities, and better scope of

advancement.

The business organization can think of expansion and growth if it has the support of

skilful, talented and happy workforce. Therefore a fair compensation system is a must

for every business organization.

The sound compensation system is hallmark of organizations success and prosperity.

Recommendations

Compensation packages should be based on quantity, quality and impact of

work.


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There needs to be focus on employee potential and current performance while

structuring the compensation and benefits package.

Provision of short term and medium term education course packages, helps the

competent employees to horne their skills and enhance their knowledge. This

in turn, helps the organization to grow.

Inclusion of overtime pay package, as work load is high during the project

completion period.

Adoption of innovative ways to reduce tax burden on employees is needed as

money saved is money earned.

Monthly/Quarterly rewards for star performers should be included, as this

keeps the employees on toes as well as for most of the employees

compensation play a crucial determinant.

The Compensation has to be balanced properly across the employees of

organization who have the same number of years of experience and also the

nature of work being same.

BIBLIOGRAPHY

www.fasttrackteam.com

www.google.co.in
http://www.fasttrackteam.com/http://www.google.co.in/http://www.fasttrackteam.com/http://www.google.co.in/


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Compensationin Organizations,by Sara L. Rynesand Barry Gerhart, eds. Jossey-BassInc.

ANNEXURE

QUESTIONNAIRE ON EMPLOYEE COMPENSATION AND BENEFITS

I. EMPLOYEE DETAILS:


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a .Name:

a. Designation :

b. Name of the Organization:

c. Years of Experience in the Organization :

d. Income Level (Annual): Below 6 Lacs 6-10Lacs Above10 Lacs

II. DETAILS OF COMPENSATION AND BENEFITS

1. Satisfactory level of employees regarding compensation based on

Factors a)Qualification b) Experience

Most Satisfactory

Satisfactory

Neutral

Dissatisfactory

Moist Dissatisfactory

2. The Organizations pay policy is clear, related to the salaries, pay and

bonus

Yes No

3. Do you believe in performance based payment system?

Yes No

If No, please state a good strategy that can be followed

4. The Organization provides pay in accordance with the responsibilities

handled


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5. Are you willing to take additional responsibility, if the compensation is

increased?

Yes No

6. According to you, is there any bias in the compensation package of

similar jobs within the Organization?

Yes No

7. The Compensation package is at par with package of similar jobs in other

Organizations in the Industry.

StronglyAgree

Agree Neutral Disagree StronglyDisagree

StronglyAgree

Agree Neutral Disagree StronglyDisagree


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8. Monthly salary provided by the organization

a) In which of the following weeks of the month is the salary provided?

First week Second week Third week Fourth Week

b) The salary paid regularly in the same time every month.

Yes No

9. Which among the following makes you feel would boost your interest in work?

a.) Increments

b.) Better amenities by Organization

c.) Scope of advancement

d.) Better working conditions

e.) Better work life balance facilities

10. Specifically, the level of satisfaction with the following

Factors Increments Sick LeavePolicy

MedicalBenefitScheme

Incentives Insurance

Most Satisfactory

Satisfactory

Neutral

Dissatisfactory

Moist Dissatisfactory

11. Would like to recommend any changes in the current Compensation and

Benefits package in the Organization

Emplyoeee Comensation Kavita Project

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