Wage and salary administration is a collection of practices and procedures used for planning and distributing company-wide compensation programs for employees. … Wage and salary administration is defined as the process by which wage and salary levels and structures are determined in organisational settings.
Also, how are wages and salaries determined?
In general, wages are determined by supply and demand, but they can be influenced by a wide variety of factors, including the cost of living in a particular area, the presence of a union and the current minimum wage. Pay rates also vary by gender, race, education level and skill level of the workforce.
Moreover, what are the basic objectives and principles of wage and salary administration?
The main purpose or primary objectives of wage and salary administration is to establish and maintain a fair and equitable wage structure. The second objective is to establish and maintain an equitable labour-cost structure.
What are the components of salary administration?
What is Wage and Salary Administration – Major Components of an Employee’s Wage: Basic Pay, Dearness Allowance, Incentive, Fringe Benefits and Annual Statutory Bonus
- Basic Pay.
- Dearness Allowance (D.A.)
- Incentive.
- Fringe benefits.
- Annual statutory bonus.
What are the factors influencing wage and salary administration in HRM?
Factors Influenced Wage and Salary Administration – Top 7 Factors: Ability to Pay, State Regulation, Labour Unions, Demand and Supply of Labour, and a Few Others. Wages and Salaries represent a significant portion of the total costs in most of the organisations.
What helps in wage and salary administration?
Wage and Salary Administration – 6 Important Factors Considered to Form a Sound Wage Policy
- Demand and Supply: …
- “Giving Wages”: …
- Cost of Living: …
- Union-Management Negotiations: …
- State of Competition: …
- State Regulation:
What is an example of a wage?
Money paid to an employee for work done, and usually figured on an hourly, daily, or piecework basis. … Wage is money paid to a worker for work performed, or the price you pay for doing something wrong or unwise. If you make $10 per hour at work, this is an example of your wage.
What is difference between salary and wage?
Employers compensate employees either by paying them an hourly wage or an annual salary. While salaried employees earn regular paychecks, even if they work long days during busy periods, certain hourly wage-earning employees are eligible for overtime pay for hours worked beyond the standard 40-hour workweek.
What is meant by wage and salary?
Wages and salaries are the remuneration paid or payable to employees for work performed on behalf of an employer or services provided. … Alternatively, all or a part may be paid in various other ways, such as payment in kind in the form of goods or services provided to the employee, such as food and board.
What is the purpose of wages and salaries?
Wages and salaries are the payment for work agreed between an employee and his or her employer under the contract of employment in the private sector and for contractual agents in the public service, or employment for civil servants.
What is wage in HRM?
Wage refers to the amount of money that an employee or a worker is getting in lieu of the work that he/she is doing. Talking more specially in HR terms wage refers to a defined amount of money given to an individual for work or services which is given on a daily or weekly basis.
Why do we need to study wage and salary administration?
WHY DO WE NEED TO STUDY WAGE AND SALARY ADMINISTRATION? To have a scientific, rational, and balanced wage and salary structure. In a salary administration, the employer should not feel that the employees are paid more than they deserve and the employees should not feel that they are underpaid.