The Extrinsic Compensation In A Business Commerce Essay

Normally the extrinsic compensation will include both monetary and non-monetary rewards specifically in monetary compensation program that to reward the employees according to their job performance level or related knowledge or skills. The monetary compensation represents core compensation. While non-monetary rewards include protection programs (for example, medical insurance), paid time-off (for example vacation), and services (for example, day care assistance), Most compensation refer to non-monetary rewards as employee benefits or fringe compensation.
Core Compensation
There are five types of monetary or core compensation. The elements of base pay adjusted over time are as follow:
Cost of Living Adjustments (COLAS)
The cost of living adjustments (COLAs) represent periodic base pay increases that are based on change in prices as indexed by the consumer price index (CPI). COLAs are most common among workers represented by unions. Union leaders fought hard for these improvements to maintain their members’ loyalty and support. Many employers use the CPI to adjust base pay levels for newly hired employees.

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Seniority Pay
Seniority Pay are systems reward employees with periodic additions to base pay according to employee’ length of service in performing their jobs. These pay plans assume that employees become more valuable to companies with time and that valued employees will leave if they do not have a clear idea that their wages will progress overtime. Employees can develop such knowledge and skills from formal education and training, including on-the-job experience. Seniority pay rewards employees for acquiring and refining their skills as indexed by length (years) of employment.
Merit Pay
Merit Pay programs assume that employees’ compensation over time should be determined, at least in part, by differences in job performance. Merit pay rewards excellent effort or results, motivates future performance, and helps employers retain valued employees.
Incentive Pay
Incentive pay or variable pay rewards employees for partially or completely attaining a predetermined work objective. Incentive pay is defined as compensation (other than base wages or salaries) that fluctuates according to employees’ attainment of some standard based on a preestablished formular, individual or group goals, or company earning.
Pay-for-Knowledge Plans and Skill-Based Pay
Pay-for-knowledge plans reward managerial, service, or professional workers for successfully learning specific curricula. Skill-based pay, used mostly for employees who perform physical work, increases these workers’ pay as they master new skills. Both skill- and knowledge-based pay program reward employee for the range, depth, and type of skill or knowledge
Type of welfare and benefit special
In organizations with more compensation. In various forms of welfare. To make it convenient for employees. It is important that the organization It costs one of the higher costs of production. But at the same time encouraging employees to work with satisfaction. Morale is working better.
Welfare of employees. Cost is another important part The operating costs of the organization, so it needs to be managed in terms of employee benefits. To optimize. Meet the objectives of the organization. Meet the needs of employees. This will motivate employees to work machine. Higher performance. Organization is beneficial in the long run.
Special benefits or benefits that are provided to employees (Fringe benefits) in addition to wages and salaries then. What used together with many species, both monetary and non-monetary. This is enough to collect the following categories.
Insured Benefits Return to assure economic stability.
Payment for Time not worked to pay compensation. During the employee does not work.
Premium Payments wage paid to the rates higher than normal rate.
Legally Required Payments compensation paid as required by law.
Estate-Building plans return to generate evidence for its employees.
Employee Service and organized. services to employees.
Employee compensation Perquisites provided to enhance the social
1. Insured benefits compensation to assure economic stability.
Insured benefits are to return to assure economic stability. And the risk that workers will be like
1.1) person plan such as
Money paid to workers on leave pay or other working age. Other.
pension paid to. Supplement after age
pay the extra money. A reward. When workers worked full time 10 years 15 years 20 years or according to set
amount of assistance to family members or heirs. If the deceased worker during an employee of the organization.
1.2) Hospitalization benefit include.
Money on medical care. When workers went to the hospital treatment room such as x-rays, medicine, etc., or service by organizing the medical unit within the organization. Treatment services for free
may include benefits to family members as children and wife (and pay the organization may pay all or partially Depending on each organization’s policy).
1.3) Life Insurance is insurance for workers. When the workers died due. From illness or accident (Accidental Death) workers will receive money Paid by insurance companies that guaranteed. This amount will be donated to the heirs of the workers listed in the card life insurance policy. The money to pay. Is the premiums. Employers will pay all Or partial pay depends on company policy. Or agreement between workers and companies.
1.4) Temporary Disability Insurance means sickness insurance (Health Insurance) and Accident (Accidental Insurance), which have resulted in loss of income. During the period that does not work. Workers would receive assistance under the insured limit the employer may pay a premium to the total or partial.
1.5) Long-Term Disability plans or return to help the workers. The premium paid to workers on behalf of the insured workers receive disability Arising from their duties. Or compensation in money to help Stay with disabilities. Or help people until age 60 years or so life.
1.6) Travel Accident Insurance is insurance from travel to business. When workers from getting involved in an accident. Will receive grants under the company’s credit insurance with insurance companies. In this case, generally Company will pay all premiums for the workers instead.
2. Payment for time not worked is that workers compensation is not the time to do work such as holiday leave.
2.1) Sick leave the organization will pay normally. During sick leave. Some organizations may need to set the Limit Up to 10 days in excess of 10 days does not allow
2.2) Vacation pay generally will pay wages to cover the ต. Despite not working during vacation. (To stop the annual vacation), some organizations have to pay extra on vacation as transportation costs walk Way to relax with some of the program guide service to their employees free
2.3) Holidays in the various holidays, such as Holidays and others will not even work would normally be paid if employees work on holidays. Some companies tend to pay compensation to the special case In addition to the regular wages.
2.4) Military Services Some organizations allow employees to leave the military. They might pay to be at full strength Or partially Or no pay. But to keep the job. When stopping the military went back to work as before
2.5) and La monk in Thailand, most employers allow workers to leave over the ordination provided. And may be paid over time as to not exceed 15 days or 1 month if La ordination than this will not be paid in excess.
3. Premium payments is money paid to the wage rates higher than normal rate. Most pay in such cases.
3.1) Overtime if working outside normal time. Defined each day. Including work on holidays. Hours in addition to normal working hours. Will pay compensation for the overtime rate of one in another. Higher than normal rate. Legal force employers to pay 50% higher than normal rate.
3.2) Shift Differentials. If the shift work night shift or shift work part-time work as usual during 16.00-08.00 hrs to return often. Higher rates of return for the. Day shift work etc.
3.3) Hazard pay is paid into a special pay increase. If working in a dangerous time. Or high risk. Or working conditions and terms of higher than normal risk.
4. Legally Required payments as welfare payments or compensation are required by law.
4.1) Social Security money to pay a number of law enforcement. Employers must pay workers for work after retirement. In an age of retirement is how much it Depending on each organization policy. Some of the 60 year old some 55 years of law enforcement money to pay periodic medical expenses (Social Security) is a type of money that companies will be gradually paid every period. Or money to pay compensation law. If the deceased worker or degenerative disabilities the ability to occupation. Due to the work of the organization.
4.2) Workmen? S Compensation is the sum that the company must pay compensation according to law Because the case worker Lack of professional ability. Injured Or death caused by work.
4.3) Unemployment Compensation Amount employee will receive during the. Looking for work can not General government Or union. Will allow (Currently in Thailand do not have).
4.4) General Welfare of the general welfare, such as a legal obligation to provide drinking water and toilet services in health care. Management safety at work etc.
5. Estate-building plans to return employees to create documents.
5.1) profit-Sharing plans a dividend policy to the company’s earnings for each year. Workers compensation employees. Pay rates are set according to whether a small percentage of the profits. And the dividend rate may vary according to age at operation. Or the salary of each employee as bonus
5.2) Saving plans can deduct the salaries of some employees to part The organization will be positive. More in the proportion. Some will use or pay in cash. Savings accounts of employees every year when the withdrawal from work (Funds).
5.3) Stock purchase plans are policies that reward companies for employees. The opportunities to employees. Purchased at the price set (Usually cheaper than market price) over time. Or employee compensation. A certificate of the business.
6. Employee service to service employees as
6.1) Employee Activity in the welfare activities for employees. The organization is the cost for setting up such community events. May be sports, music, sports competition for employees. Sports equipment for organized tours of the year etc.
6.2) Cafeteria lunch on the welfare of charge. Or the rate of receiving a special discount. Some will be snacks, tea, coffee for its employees during working hours etc.
6.3) Discount purchase discount policy to the employee. In order to purchase the organization as a manufacturer company that produces soap. I will be selling soap to its employees. The price cheaper stores. Or automobile companies may give discounts to their employees. When buying car companies etc.
7. Employee perquisites organized a special return. To lift Social level. Or to see the company over competitors such as
7.1) Management perquisites organized a special return. For example, employees in the executive.
The vehicle position in the private
car can withdraw fuel fee. For bus location. Car or personal
assistance in the repayment term. For those who want to buy a house or car
Club Memberships provide for meeting the social, business or relaxation after work
and organized work area rich. The furniture. Various facilities and many
special food and room for executives (Executive Dining Rooms).
7.2) General Employee perquisites organized a special return. For example, employees in the normal level.
Residential accommodation provided by gratuitous Or about the rate of special
places for organized recreation. The TV to view or listen to the music, fiction
organized a place for recreation with TV, listening to music or see a fiction.
Employee Counseling Services counseling employees in various
The importance of areas. Employee Benefits.
1. In the use of such special compensation. A catalyst for the workers. Organizations working with wholehearted And higher efficiency.
2. Compensation or benefits in the form of special compensation (Fringe benefit) will allow organizations the flexibility to pay compensation Rather than paid as a salary. It can be adjusted up or down easily.
3. Is to help create a good image for the organization. Because of the organization to focus attention and facilitate assistance to their employees that Society organizations will look good with a sense of the faith and lead to a good cooperation in organization.
4. The organization of the welfare and benefit a good special. Will be instrumental to attract outsiders to want to work with the organization. The District have An opportunity to recruitment easier. And the opportunity to recruit the best people to work.
5. Help build good relationship between employer and employee. Enhance the labor organization in a good way. Reduce the result of demand Negotiation
Organizations can use the Social Welfare and Special Reward (Fringe benefit) such as a distraction or trust worker To work with other organizations for reducing the out of employees. Also help create good morale for the workers as well.
System welfare staff.
The. administration fee. returns.
The. administration fee. returns. or the. administration, including wages and salaries. effect of other benefits support the management of cost control in the. performance incentives. To retain that quality for the organization.
So and. Administration fee. returns. the need to effectively conduct the. for compliance with government policy satisfaction. And the ability of people to be the impetus for the. homing operation quickly.
Objective in the. Administration Wage and salary
For recruitment into organizations.
To control costs. and. performance.
For for staff satisfaction.
For for selected personnel, create effect work for better.
The. organized structure of wages and salaries.
The. preparation fee structure. returns. in the form of wages and salaries to proceed to. based on the following principles.
1. The principle of equality. Both within and outside the organization.
2. The principle of fairness. Is consider effect returns. and. performance.
3. Principles to attract and motivate. People are considered to have knowledge. High responsibility have the opportunity to receive effect returns. increased by
4. Core capabilities in the. Quantity working time for. work.
The. pay. returns. the image effect useful aid
The. pay. returns. in the form of wages and salaries, including benefits and effect useful support that be effect useful supplement or effect beneficial financial detour for. pay. effect useful support caused by a number of reasons as follows.
The concern for the welfare of staff personnel died when the case can not work or leave without enough money living.
Improve the organization creates morale for the young people an opportunity to move higher.
Attract and retain talent.
Pressure from society and government.
Effect other than salary, including benefits support.
Effect of security interests in the. performance.
Effect in welfare benefits support various
Effect useful support in the. medical care.
Effect in the case of retirement benefits support.
Effect useful support for the. leave
Trends. and. pay. returns. modern.
System of. pay. returns. as effect of. performance.
System of. pay. returns. flexible.
The. for effect returns. vary by subgroup.
The. for effect returns. the visible and invisible
The. for effect returns. the fair.
ESOP (Employee Stock Options). The right to buy shares at the price set (similar to the warrant), but issued to executives or employees of particular
ESOP. the instruments used to increase motivation to work for employees who are not shareholders of the Company with the return part of their relationship with the company’s stock price that is, if the share price increase They can exercise stock at par Make them profitable, so employees who are ESOP would be boiling hot with a stock price of more than employees who receive salaries, but only. The behavior of shareholders, employees want to be
It is considered governance principles. Executives who know the (insider) before someone else should not be owned by It will take advantage of other shareholders. But because the administration did not hold any shares it may work for the Company is not full is it distributed ESOP instead shares to create a sense of ownership personally I think this idea is a concept that sounds พึ deeply weird not to make sense does it become that Executives who know more than shareholders already great advantage to large shareholders. Because if shares fall I do not get a loss (just leave the ESOP expired merely What’s not interested), but if it shares the profit with the same shareholders.
However, it is optimistic the ESOP with these hands together. I think in some businesses it is necessary to the management. (This is the only employee) has been divided into pieces of large companies when they make a profit increase significantly. Some businesses require top executives proved life Split share the management just does not exceed 1% of the total shares in the ESOP is to create incentives for executives are significant because when I think a lot of money, Kho is for people to eat salary.
Finally, I think that ESOP has both advantages and disadvantages.time so I hold shares in the ESOP are not opposed, I will come out soon. Knowledge within the company, which might be better than a good intention of the ESOP time I visit ESOP structure out before that there is a sense how Reflect the intentions are pure how although the ESOP would make the denominator of EPS growth and the resulting bad for shareholders, but the ESOP could be beneficial to shareholders by if the ESOP the output can be changed. administrators who are employed by mere Into working life has presented Imagine if we forgo equity executives tattoo 1-2% and the company executives are 10-20% higher value is considered worth more than a waste, so worth it ESOP. Not a bad thing for shareholders always Shareholders should consider the structure of the ESOP to come out before you support or oppose the issuance of the ESOP.