When talking about remuneration package, generally your wages or salary is the main part of such package although it may contain other rewards such as milk or meals, electricity or gas allowances, telephone, or a car. Depending on specific policy applied, most companies usually provide a good package of remuneration so that workers’ right can be met properly. However, it would be likely easy to us if we understand one thing: the package should suit the business situation. In other words, the number of package should reflect the duties and responsibilities of the skills and the position of the employee.
A remuneration package, therefore, should come with attractive offer and should be considered on current rates the market offered for the same positions. Basically there are few terms connected with remuneration, namely pay, bonuses and incentives, as well as gratuities. We shall explain each of them and will be started with ‘pay’.
It often called wages and refers to the amount of payment made to employees on specific basis of them (by the week, day, or hour). Furthermore, there is also another term which usually used to define pay, and it is salary. The latter is different compared to that of wages. Basic idea of salary is that an employee will get paid outside the basis of time.
If an employee received payment without qualifications or conditions attached to it, then s/he receives a gratuity. A retired employee may earn a certain sum in addition to other payments simply in appreciation of the work that she or he has shown for the industry. Gratuity must be documented so that it won’t lead to confusion when compared with other payments.
Bonuses and Incentives
It is common that a business may reward employees with bonuses, which will be giving to employees who meet set goals or targets. Let’s give an example when an employee have had higher productivity. In this situation, a company whom he has been working will give bonuses in a series of appearances, which is calculated based on certain criteria. Bonuses will be considered under a workplace agreement, so it is not placed under rates of pay.
It is true that a remuneration package has become an integral part of wages, and it appears in certain forms such as milk, meals electricity allowances, telephone, a car, accommodation and any other benefits. So the formula would be that of “wages + remuneration”. There is however minimum award rates of entitlements and pay and benefits cannot take the place of it.
Surely, “pay” is regulated under a specific law, and so is remuneration. A businessman should determine the minimum amounts of remuneration package regulated by the law. By which point, a businessman should think about how much s/he can provide so that the company can begin to work out an amount of remuneration.
In the end, remuneration is the way to attract the right people so that they are willing to join your company. A company must match market pay rates as well, in order to calculate amount of remuneration will be offered to employees.
Free Download - Amazing Powerpoint Slides on Fundamentals of HR Management and HR Scorecard
Thank you for subscribing.