Concept and determinants of compensation.
Methods of establishing employee’s compensation; current trends in compensation; Incentives plans; Different forms of incentives; Union influence in compensation programs. Compensation practices in NepaleseOrganization.
Compensation is the financial reward that is received by the employees from the organization for their services. It provides an important incentive in motivating employees to higher levels of job performance to higher paying jobs in the organization. Compensation uses reward to motivate personnel to achieve an organization's goal of productivity, innovation and profitability. Thus, compensation is an important function of human resource management.
Incentive is direct compensation for performance. It is necessary for motivating the employees, for achieving an organizational goal, for achieving cost effectiveness and for retaining efficient employees from quitting the organization etc. It provides both financial and non-financial reward to enhance the productivity in the organization.