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Question
"if the employees believe that subjectivity and favouritism shape the pay system in an organization then it does not matter that the system was properly designed and implemented" discuss

Answer
   It is  true  that  in  india, a significant  amount of  managers  show subjectivity and favouritism in  running   the  business operation.
  But  the  pay system should be properly
designed and implemented .
What is  a  good  wage  administration system
1.   WAGES AND SALARY ADMINISTRATION

Development of A Pay System
Review of JoDescription
Conduct Job Evaluation
Gather Wage Survey Information Pay Structure Administer Individual Pay Adjustments Monitor & Upgrade Pay System
Factors Affecting
Wage / Salary Levels• Remuneration in comparable industries• Firm’s ability to pay• Relating to price index• Productivity• Cost of Living• Union Pressures & Strategies• Government Legislations
DEFINITION WAGES & SALARY• Base wages and salaries are defined as the hourly, weekly and monthly pay that employees receive for their work in an Organization.• Can term it as compensation management.• Thus, Wage & Salary Administration is the group of activities involved in the development, implementation& maintenance of a pay system.
Difference in Wages, Salary & Compensation Terms WAGES SALARY COMPENSATION Paid to BLUE Collared Paid to WHITE collared Employees Comparative FormOn Daily, weekly, Monthly Paid at specified Intervals All Basic , gross amount ,Can be measured in terms allowances + Benefits of money Paid to Employees whose contribution cannot be measured
Principles Governing Compensation AdministrationMaintaining EquityMaintaining CompetitivenessMatching Employee ExpectationsReinforcing positive employee behaviorEliminating any discrepancyOptimization of management and employee interestsMaintaining good IR and harmony
Purpose of Wage & SalaryAttracting talented resourcesRetaining and motivating employeesFinancial ManagementLegal Requirements
Medical Reimbursem ent Special AllowancesBasic Salary DIRECT Bonus COMPENSATIONHouse RentAllowance Leave Travel Allowance Conveyance
Overtime Allowance Hospitalizati on Leave Policy Insurance
INDIRECT COMPENSATION
FlexibleTimings Leave Travel Holiday Homes Retirement Benefits
Types of Incentive Plans
• SHORT TERM PLANS: Halsey Plan, Rowan, Barth, Point Rating System, Progressive Bonus• LONG TERM PLANS: Annual Bonus, Profit SharingDirect Compensation Indirect TOTAL(Base Pay, Incentives) (Benefits) COMPENSATION
Concepts of Different Wages
MINIMUM WAGES: Minimum amount of remuneration paid to workes. Under Minimum Wages Act 1948.
FAIR WAGES: Workers performing work of equal skills, difficulty or unpleasantness should receive equal or fair wages Match the prevailing wage rates
LIVING WAGES: Living wages should enable the male earner to provide for himself and his family, not only the bare essentials of food, clothing and shelter, but also a measure of frugal comfort including: Education for the children , Protection against ill-health ,Requirements of essential social needs , A Measure of insurance against the more important misfortunes including old age

Wage Boards / Pay CommissionsWage Policies are formulated by following Institutions in India1. Collective Bargaining & Adjudication2. Wage Boards3. Pay Commissions

Reports & Documentation • Payroll Journal Voucher• Salary and Payroll Payslips (print / PDF / email Processing / online) Statutory Payroll Reports Salary Statements Leave Management Dynamic report writer tool Employee Self Service PF & ESI reports (monthly, Payroll Reconciliation Tools annual) Reimbursements & Loans Monthly Profession Tax Payroll Processors & reports Outsourcers Income tax statement Arrears & final settlement Form 16 PDFs Head count summary Quarterly eTDS filing ()
Payroll SoftwareManual System PAYROLL PROCESSING Accountant Payroll Outsourcing
Evolution of Strategic Compensation Traditional Modern Change in Compensation Compensation Compensation System System Systems
Trainings• This program focuses on building a broad understanding of compensation, and covers:• HR’s role in compensation• Components of total compensation• Laws and regulations affecting compensation programs• Independent contractors• Indirect compensation (benefits) programs• Legally required programs• Who Should Attend? This fundamental program is designed for HR practitioners just entering the field, established HR employees with little or no formal training, other employees who have responsibilities that fall under the HR umbrella, and business owners and managers without HR departments.
Conclusion
• Compensation is a hot potato for the Human Resource Department. The motivation level of the employees to great extent lies in monetary rewards. In the current state of affairs it is indispensable to restructure the pay models. Similar to changes bought about in the other departments the HR should also emphasize on restructuring the costs so as to bring the variable cost close to zilch.• The major challenges what manager’s face today is retention of the man power and the major cause of it is that they are paid better in the other organizations.
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