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    COMPENSATION

    &BENEFITS

    PRESENTED BY

    BHANU KALYAN 04

    PREETI DHAWAN 09

    GHANSYAM

    ABHIJEET HELE 17

    PRATIK LANGI 28

    GOVIND MASRAM 31

    NIDHI CHHABRA 36

    AKHIL PALRECHA

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    Overview of Employee Compensation and Benefit in

    India

    Employee CompensationEmployee Compensation

    SalarySalary AllowancesAllowances& Bonus& Bonus

    EmployeeEmployeeBenefitsBenefits

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    Companies providing benefit

    Analysed items

    House Rent Allowance

    GratuityHousing Loan

    Medical reimbursement/ allowance

    Insurance

    Leave Travel allowance

    HospitalisationVariable Bonus

    Conveyance allowance

    Superannuation

    Car Loan

    Social/ Sports club membership

    Incentive/ Sales Commission

    Hard Furnishing

    Medical check-up

    Fixed Bonus

    Other allowances

    Flexible benefit plan

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    HOW TO MOTIVATE?

    One that i based on the understanding of

    how human nature wor s. All humans aremoti ated by 2 things -- leasure orpain.

    Ability and moti ation are the core part of

    any good employee moti ation program Ability can be improved with training and

    education.

    Motivation is the willingness of a person to

    want to perform a task

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    KEY ELEMENTS OF MOTIVATION

    PROGRAM Positive reinforcement along with high

    expectations, provide training whennecessary.

    Treat people fairly, with respect, and honestly

    Understanding and addressing employeeneeds.

    Teach employees how to set work relatedgoals.

    Restructure orreorganize jobs and jobdescriptions when necessary.

    Have a rewards system based on jobperformance.

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    MOTIVATION TECHNIQUES

    One technique to motivate employees thatworks really wellis the employee of the month.

    Othereffective employee motivationtechniques include competitions between

    teams in orderto get projects completedfaster, awards forperfect attendance, andawards forjobs well done.

    Some companies willlet customers rate theircustomerservice representatives. At the end

    of a specific time frame an award is given tothe person who has provided the mostoutstanding customerservice.

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    OUTCOME OF THE PROGRAMS

    Helps in finding out exactly what theemployees like and dislike about theircurrentemployment situation

    How employee satisfaction is changing over

    any given time period Employee retention and turnoverrates can be

    greatly improved by using employeemotivation surveys as exit surveys, thecompany needs to know why employees are

    leaving. Is it a skillissue, a pay rate issue, etc. Improving employee retention is a great way to

    improve a company's bottom line

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    Employee Benefits Insurance Cos viewpoint

    Employee BenefitsEmployee Benefits

    InsuranceInsurance RetirementRetirement

    DefinedDefinedContributionContribution

    DefinedDefinedBenefitBenefit

    LifeLifeAccidentAccident MediclaimMediclaim LeaveLeaveEncashmentEncashment

    GratuityGratuity

    SuperannuationSuperannuation

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    Mediclaim Insurance

    Reimbursement of medical expenses following hospitalization

    Cash less hospitalization facility available under certain plans

    Tax deduction available for the business

    Accident InsuranceAccident InsuranceCan offer compensation for any/all of the following:

    Accidental death, disability

    Medical expenses for treatment post accident

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    Leave Encashment Defined benefit

    For whom?

    y If company offers encashment of leave, all employees

    What benefit?

    y Will be based on the company policy.

    y Normally xdays salary for each accumulated day of leave

    How Funded?

    y Institute of Chartered Accountants of India require that aprovision be made for the liability.

    y No special tax benefits for self-funding through a trust

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    Gratuity Defined Benefit

    For whom?

    y Engaged in Factories, Mines, Plantations, Railways, Shops

    and establishments notified by Government

    y In service for 5 successive years

    What benefit?

    y 15 days wages for each year of service

    y Maximum limit Rs 3,50,000/

    y7 days wages per season for seasonal occupation

    How Funded?

    y Special tax concessions if funded through a trust or insurance

    company

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    Superannuation Defined Contribution/ benefit

    Superannuation, is a special way of saving to provide yourself withan income when you retire.

    Retirement plans may be set up by employers, insurancecompanies, the government or other institutions such as employerassociations or trade unions

    For whom?

    y Non-mandatory, defined by company policy

    What benefit?

    y Can be defined benefit(certain formula of last drawn salary) /definedcontribution(certain %age of salary every month contributed to a fund)

    y Can be different for different grades How Funded?

    y Special tax concessions if funded through a trust or insurance company

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    Retirement Benefits - Trends

    Offers a cash-accumulation conventional scheme.

    Normal Retirement Age The normal retirement age is 65 years.

    Human Resource Department will write to each employee 6 monthsprior to their normal retirement age.

    More and more companies now funding through Insurance

    Pensions benefits - In general, a pension is an arrangement to

    provide people with an income when they are no longer earning a

    regular income from employment.

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    DEARNESS ALLOWANCE

    The Only Purpose of Dearness Allowance is to enable aworkerin event of a rise in cost ofliving to purchase thesame amount of goods of basic necessity as before

    DA is calculated based on AICPIN (All India Consumer

    Price Index Number) Dearness Allowance is paid on the Basic Pay as defined

    in FR 9(21)(a)(i)+NPA, if any (PersonalPay, SpecialPay, etc., not included)

    There are 2 kinds of payment of DA as practiced in India

    :- linked to cost ofliving index

    - not linked to cost ofliving index

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    DA and CONSUMER PRICE INDEX

    As perthe Rupee-point system, Increase ordecrease in DA is decided based on theaverage Quarterly/Half Yearly increase ordecrease in ConsumerPrice Index Point. For

    example in the cement Industry DA increasesordecreases by Rs 2.15 perpoint .The SugarIndustry calculates DA at Rs 2/- perpoint.

    The expected All India ConsumerPrice Indexnumber(AICPIN) forIndustrial Workers Base

    2001=100 forthe month of May 2010 wasreleased by Statistical Department, Labour.The AICPIN forthe month of May 2010 is 172.

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    HOUSE RENT ALLOWANCE

    House Rent Allowance is wage in cases

    where it is being paid.

    In cases where an employee is being paid

    house rent allowance, the same will be

    included both forcoverage and contribution

    In cases where the staffquarters have beenallotted the amount of salary and wages paid

    will count forcoverage and contribution and

    no notional house rent allowance is to be

    presumed in such cases.

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    CONVEYANCE ALLOWANCE

    Conveyance allowance is paid to the employeeto compensate the expenses incurred by the

    employees on travelling etc The travelling allowance orvalue of any

    travelling concession is also being paid to theemployees in the nature of conveyanceallowance, which is neitherwages forthepurpose of coverage of employees underSec.2(9), norit is treated as wages forthepayment of contribution underSection 2(22) ofthe ESI Act.

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    MEDICAL ALLOWANCE

    The employees working infactories/establishments are being providedmedical services in kind by the employerbut incertain factories/establishments instead of

    providing medical services in kind, the amountspent by the employees on medical care isreimbursed while in some otherorganisations,employees are being paid monthly cashallowance in lieu of medical aid/reimbursement

    of medical expenses. Where such paymentsare made by the employerin lieu of themedical benefit, the same are to be treated aswages underSec.2(22) of the ESI Act

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    NEWSPAPER ALLOWANCE

    In certain factories/establishments the

    employees are reimbursed the cost ofNewspapers while in some otherfactories/establishments the employees arepaid monthly newspapers allowance instead ofreimbursement of the cost of the Newspapers.

    Where the amount is being paid regularly to theemployees by the employeras Newspapersallowance the same will be treated as wagesunderSec.2(22) of the ESI Act

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    EDUCATION ALLOWANCE

    Employees are being paid monthly Educationallowance forthe children studying in theSchools/Colleges. Where such educationallowance is being paid monthly, the same is

    to be considered as wages underSec.2(22) ofthe ESI Act and the contribution is chargeableon the said amount.

    However, in such cases where instead ofpaying the education allowance on monthly

    basis, the amount spent as fee is reimbursedto the employees and booked undereducationallowance, in such cases no contribution ispayable

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    DRIVERS ALLOWANCE

    In some of the factories/establishments the officersemployed as employees are being paid driversallowance permonth. This allowance is being paid toenable the officers to appoint a driverat theirownlevel and such drivers employed are not being paid

    salary directly by the factories/establishments.Where such allowance is being paid to theemployees and the drivers are not engaged by theemployees, in such event the allowance paid assuch will be considered as wage underSection 2(22)of the ESI Act and contribution will be chargeable

    provided the employee is coverable undertheScheme

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    EMPLOYEES' PROVIDENT FUND

    ORGANISATION EPFO statutory body of the Government of

    India underMinistry of LabourandEmployment. It administers a compulsorycontributory Provident fund, pension and

    an insurance scheme forIndian Workforce.

    The primary aim is to provide old-ageincome security so as to contributing to theeconomic and social well-being of Indians

    The Employees' Provident Funds andMiscellaneous Provisions Act, 1952 cameinto effect on 4th March 1952

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    EPFO (contd)

    There are a total of about 40 millioncontributing and non contributing membersin about 450,000 covered establishments.

    As perprovisions in force almost anyestablishment in India is required to have aregistration with the basic criterion beingemployment of 20 ormore persons

    Contribution is at present 12% ofbasic

    salary as employee's share and a matchingcontribution by the employer, with the totalto be 13.61% of the total wages of theemployees.

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    GRATUITY

    Gratuity is a payment made forthe past services ofthe employee by the employerwhen employee retireorresign from the organization

    It is payable for15 days peryearfora period theemployee has worked in the organization

    Gratuity is payable to any employee only afterthecompletion of 5 years of continuous service in theorganization

    Covered underthe Payment ofGratuity Act,1971: (Last drawn monthly basic salary + dearness

    allowance)/26 x 15 days x numberof years ofservice (date of joining date ofretirement/leavingjob)

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    EMPLOYEE STOCK OPTION PLAN

    An employee stock option is a call option on thecommon stock of a company, issued as a form ofnon-cash compensation

    Employee stock options are mostly offered tomanagement as part of theirexecutive compensationpackage

    Employee stock options (ESOs) are non-standardized calls that are issued as a privatecontract between the employerand employee. Overthe course of employment, a company generally

    issues ESOs to an employee which can be exercisedat a particularprice set on the grant day, generallythe company's current stock price.

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    PERFORMANCE LINKED

    INCENTIVES

    PLI is a form of payment from an employerto an employee, which is directly related tothe performance output of an employee

    and which may be specified in anemployment contract

    PLI vs. salary

    PLI vs. bonus

    PLI vs. appraisal PLI vs. retention bonus

    Method of calculating PLI

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    MARICO

    Marico is a leading Indian group providingconsumer products and services in the areas ofHealth and Beauty based in Mumbai

    During 2009-10, the company generated aTurnover of about Rs.26.6 billion (USD 600Million), in respect of its food, hair care andskin care related activities

    The organisation holds a number of brands viz.

    Parachute, Saffola, Sweekar, Hair&Care, Nihar,Shanti, Mediker, Revive,Kaya Skin Clinic,etc

    As of 2010, it employs 1000 people

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    ORIENTAL BANK OF COMMERCE

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    VISION

    To be a sound all India, customercentric, efficient retail bank with

    contemporary size, technology andhuman capital; endeavouring toenrich lives across all sections ofsociety; and committed to upholding

    the highest standards of corporategovernance.

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    MISSION

    To provide the finest banking services byupgrading human capital and infusing

    advanced technology, thereby achievingtotal customer satisfaction; and beingreckoned as the Best Bank in theIndustry on all efficiency parameters.

    To enhance shareholders wealth by

    ensuring sound growth of business andmake valuable contributions to nationaleconomic growth.

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    CSR ACTIVITIES

    GRAMEEN PROJECT

    'The Comprehensive Village Development

    Programmer

    14 point action plan

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    ALLOWANCES Dearness Allowance

    House Rent Allowance Travelling Allowance

    Entertainment Allowance

    Hilly Area Allowance Medical Allowance

    Children Education Allowance

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    OTHER

    BENEFITS

    NIGHT DUTY ALLOWANCEGRATUITY

    FESTIVAL ADVANCE

    LEAVE ENCASHMENTENTERTAINEMENT

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    Our mission is to improve the quality of humanlife by enabling people to do more, feel betterand live longer

    Ourbusiness employs 96,500 people in over 100countries

    Around 13,000 people work in our researchteams to discover new medicines

    Our vaccines are included in immunisationcampaigns in 182 countries worldwide

    We delivered 1.4 billion vaccine doses to 179

    countries in 2010 Ourlong term vision is for our entire value chain

    to be carbon neutral by 2050

    Many of our consumer brands are householdnames: alli, Ribena, Horlicks,Lucozade, Aquafres

    h, Sensodyne, Panadol, Tums

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    Ourproducts

    1. Prescription medicines

    2. Vaccines3. ConsumerHealthcare

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    Salary model:

    Basic Rs.170 /- p.m.

    Dearness AllowanceR

    s. 13179.50/- p.m.

    House Rent Allowance Rs.1260.58/- p.m.

    Medical Allowance Rs. 292/- p.m.

    Education Allowance Rs. 639.43/- p.m.

    C/Fpaise Rs.1.89/- p.m.

    Total Rs. 15543.4/- p.m.

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    Expences :

    Dealy Allowance Rs.215/-p.m. (metro city)

    Rs.195/-p.m.(otherthan metro city)

    Ex. Headquarter Rs.205/-p.day.

    Mob. Allowance Rs.500/-p.m.

    Local train pass -------

    Traveling Allowance Rs. 3.5/- p.km.(perday 140 k.m.)

    Stationary Allowance -------

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    Incentives: if target achieve

    Monthly Rs.2500/-

    Quarterly --- Rs.20,000/- Six month Rs.30,000/-

    Coverage and Reach----Rs. 2500/-p.m.

    Product wise Incentives.