What Is Compensation

De BISAWiki

Employee compensations play a big role in getting the right people for the work. A good compensation package attracts the proper applicants to a vacant position and retains top quality employees. What Is Compensation? Compensation refers to wages, salary and/or incentives received by a worker for the performance of his/her job that also contains other types of services and benefits that may be given by the business. Compensation also refers to monetary and non-monetary advantages given by the organizations to the employees to motivate them in performing their job. Monetary compensation examples include: wage, salary, allowance, and bonus, commissions, while non-monetary compensation examples are: children education, transportation, medical benefits and many others. There are several types of Total Compensation, in most organizations, wages and salaries are very different in a few ways although both refer to regular monetary compensation. Incentives are even different altogether. Wages generally in most companies reference the compensation paid by employers to workers. Frequently paid in an hourly rate, that is paid to groups such as for instance those who work in production or maintenance; this could have family allowance, relief pay along with other financial support. Salary is paid to employees who work in a clerical, administrative, and professional capacity. Frequently salaries are based on a weekly or monthly rate. Incentives alternatively are schemes or programs of companies to motivate their employees. This is usually monetary but also can include a variety of non-monetary benefits and/or prizes. There are many factors that affect compensation. A number of them are: -The company's power to pay - The prevailing compensation and benefits in the industry -Availability of competent and qualified people for the position -Performance and productivity of the employee -Qualifications and relevant experience of the employee- Compensation DOE And many others. Compensation can mean different things to different people. A manager and an employer could have a different perception in regards to compensation and wages. To find out more please visit www.about-compensation.com