REWARD AND COMPANSATION

report

Submitted by:

Munim Namdar ( 26 )

Aimen intazar

Khadija ikram

Asma nazir

Ayesha Akmal

Submitted to:

Dr. Pro Asim frooq

Date:

30/3/2019

Saction:

SHAHEEN AIR LINE

What Is Extrinsic Motivation?

Extrinsic motivation occurs when we are motivated to perform a behavior or engage in an

activity to earn a reward or avoid punishment. In this case, you engage in a behavior not because you
enjoy it or because you find it satisfying, but in order to get something in return or avoid something
unpleasant.

What Is Intrinsic Motivation?

Intrinsic motivation involves engaging in a behavior because it is personally rewarding;

essentially, performing an activity for its own sake rather than the desire for some external reward.
Essentially, the behavior itself is its own reward.

Extrinsic vs. Intrinsic Motivation: Which Is Best?

The primary difference between the two types of motivation is that extrinsic motivation arises
from outside of the individual while intrinsic motivation arises from within. Researchers have also
found that the two type of motivation can differ in how effective they are at driving behavior. In one
study, for example, children who were rewarded for playing with a toy they had already expressed
interest in playing with became less interested in the item after being externally rewarded.

elements of core compensation:

Wages

One key element of a compensation plan is employee classification and wages. Hourly wages
are listed for non-exempt employees and salaries are listed for exempt employees. Under the Fair Labor
Standards Act, employees classified as non-exempt are entitled to overtime at one and a half times their
hourly rates, if they work over 40 hours in one work week.
Health Insurance

Compensation plans also contain detailed information about medical, dental and vision benefits.
There are usually several different plans offered for each benefit, varying in price and coverage.
Differences lie in deductible amounts, percent coverage and network providers. Higher-priced plans
usually have lower deductibles, higher coverage and a wider variety of providers. The compensation
plan also includes rates for insuring spouses and dependents. The cost of health insurance is deducted
on a pre-tax basis from the employee's paycheck.

Paid Time Off:

Both non-exempt and exempt employees qualify for paid time off. Paid time off
includes vacation and sick days, holidays and personal days. The compensation plan lists
how many vacation and sick days the employee is entitled to and at what point the
employee earns more. Most firms base the amount of vacation and sick time on years of
service. For example, an employee with 5 years of service receives 3 weeks of vacation,
whereas an employee with 1 year of service receives 2 weeks of vacation. The plan will
state which days are designated holidays and how many personal days the employee has.
What is a Base Pay:
Base pay is the initial rate of compensation an employee receives in exchange for
services. It excludes extra lump sum compensation such as bonuses or overtime pay, as
well as benefits and raises. An employee's base pay can be expressed as an hourly rate or
as a weekly, monthly or annual salary.

Base vs. Annual Pay:

While base pay excludes supplemental compensation received in the course
of employment, annual pay takes into account actual earnings over the course of the
year. Annual pay may be significantly higher than the base pay since it may include
bonuses, overtime, benefits or awards.

Annual pay also factors in any amounts paid by an employer for a worker's medical,
dental and life insurance policies. The sum of these premiums is added to the base
rate, along with other forms of compensation such as overtime or bonuses, to
calculate the amount of pay that was actually received in a calendar year.

what are legally required benefits:

Legally Required Benefits. 3 definitions. Legally required benefits include the

employer's costs for Social Security, Medicare, Federal and State unemployment
insurance, and workers' compensation.

4 Legally Required Benefits Every Employer Should Know

1. Unemployment Insurance

Workers who lost their jobs through no fault of their own—for example, the company was
downsized, restructured or shut down—are eligible to apply for unemployment.

Unemployment replaces a portion of laid-off employees’ lost wages while they look for work.
Employees typically receive half pay for up to 26 weeks. If your business is required to pay these
taxes, you must register with your state's workforce agency.

2. Workers’ Compensation Insurance

Workers’ compensation offer financial protection to employees that suffer an injury or illness
at work or while performing the duties of the job, resulting in their needing medical care and/or
missing work. Workers’ compensation reimburses employees for medical expenses and loss of pay.

3. Family and Medical Leave

 The Family and Medical Leave Act ensures that employees can balance work and family
responsibilities. FMLA allows employees to take unpaid, job-protected leave (up to 12 weeks) for
significant family or medical reasons, and group health benefits are maintained.

4. Disability Insurance

Similar to workers’ compensation, disability insurance supports employees that are injured or
ill to an extent that they are unable to perform their job functions, providing partial wage
replacement. Employers with employees located in any of the following states are required to
purchase disability insurance.

Discretionary benefits:

Discretionary benefits are employment benefits that are not mandated by law. They
can include a range of employee benefits, such as health insurance, sick leave,
maternity leave, vacation leave, pension plans, life insurance, and prescription drug
insurance.

Seniority-based pay:

Seniority-based pay systems are those in which the primary basis for pay increases
is the employee's tenure. It should be noted that seniority-based pay systems can take
into account performance, but the main factor is tenure.

Seniority Versus Performance Pay Systems:

Seniority-based pay systems are those in which the primary basis for pay increases is the
employee’s tenure. It should be noted that seniority-based pay systems can take into account
performance, but the main factor is tenure. Some benefits of seniority-based pay include loyalty,
retention, and stability of all staff members, regardless of performance levels. Performance-based
pay systems consider performance as the primary basis for pay increases. As with seniority-based
pay systems, other factors, like tenure, can be accounted for in a performance-based system, but
employee performance, however conceptualized by the organization, is the impetus in determining
pay raises.

Merit pay:

Merit pay, also known as pay-for-performance, is defined as a raise in pay based on

a set of criteria set by the employer. This usually involves the employer conducting a review
meeting with the employee to discuss the employee's work performance during a certain
time period.
Incentive pay:

Compensation awarded for results rather than for time worked. Incentive pay, also
known as pay-for-performance, is so-called because the prospect of financial compensation
is supposed to be an incentive for an employee to remain motivated, work hard and strive for
the best possible results. Commission, where sales staff get paid a proportion of each sale
they make, is a common form of incentive pay.

ACT,S:

Fair Labor Standards Act of 1938:

The Fair Labor Standards Act (FLSA) provides workers with minimum wage, overtime pay, and
child labor protections. The FLSA covers most, but not all, private and public sector employees. In
addition, certain employers and employees are exempt from coverage. Provisions of the FLSA that
are of current interest to Congress include the basic minimum wage, subminimum wage rates,
exemptions from overtime and the minimum wage for persons who provide companionship services,
the exemption for employees in computer-related occupations, compensatory time of overtime pay,
and break time for nursing mothers.

Minimum Wage Rates:

Minimum Wage Rates Under Section 6 of the FLSA, employers must pay covered, nonexempt
employees at least $7.25 an hour.16 However, the FLSA includes several subminimum wage rates.
Employers may pay lower minimum wage rates to tipped employees; workers with disabilities; new
hires under the age of 20; full-time students who work in retail or service establishments, agriculture,
or institutions of higher education; and high school students who are at least 16 years of age and
enrolled in a vocational education program.

Overtime:
Under Section 7, employers must pay covered workers at least one-and-a-half times their regular
hourly wage for hours worked over 40 hours a week at a given job. Employers may choose to pay
more than time-and-a-half for overtime or to pay overtime to employees who are exempt from
overtime under the FLSA. Under the FLSA, overtime pay applies to hours worked in excess of 40 in
a workweek. Thus, the law allows some flexibility in work hours. For example, an employer could
schedule four 10-hour workdays in a workweek without asking employees to work overtime.
Similarly, an employee who works a five-day workweek could work four hours one day and nine
hours the other four days and not work overtime.

Child Labor:

The FLSA sets minimum age requirements for youth employed outside of school hours in
agricultural and nonagricultural occupations. In nonagricultural occupations, the act sets a general
minimum age for employment of 16. In agricultural occupations, the general minimum age to work
is 14.The FLSA includes a number of exceptions to the general minimum age requirements of the
act. Under a parental exemption, a child of any age may be employed by his or her parent (or person
standing in the place of a parent) in any occupation in a business, including a farm, owned or
operated by the parent. But, youth under 18 cannot be employed in mining or manufacturing,
including in a business owned or operated by a parent.

performance appraisal:

A performance appraisal is a systematic, general and periodic process that assesses an

individual employee's job performance and productivity in relation to certain pre-
established criteria and organizational objectives.

General Appraisal:
It is an ongoing communication between the manager and the employee throughout the
year. End of the year, they will determine if the pre-set goals and objectives were met,
provide feedback and set new goals.
360-Degree Appraisal:
It allows other employees to provide feedback about their experience with a specific
employee. This feedback of peers can be reviewed by manager and considered for
appraisal process.
Technological Performance Appraisal:
It assesses technical expertise/capabilities of an employee. It figures out employee
throughput and identifies how sound he/she is technically.
Employee Self-Assessment:
The employee assesses himself/herself and it is finally compared with the manager’s
completed assessment results. It is followed by discussions and if there are differences,
manager speaks to the employee about it.
Manager Performance Appraisal:
In this type, managers go through the appraisal process. It is the role of the manager that is
very crucial handling both the team and the client. Manager has to satisfy the clientele
without disrupting the (team’s) employee morale. Most often manager appraisal process
involves feedback from the respective team members and sometimes from the client as
well.
Project Evaluation Review:
This is one of the best ways to identify how good an employee is at work. Rather than to
wait to review an employee end of the year, it helps evaluating employees end of each
project.
Sales Performance Appraisal:
A sales person is judged by the goals he/she has set versus his/her results. Salesmen are
closely held to the financial goals of any organization. The manager and salesperson must
find out ways to achieve goals prior to which they must set realistic goals.
Goal setting:
Every organization forecasts future and has standard goals to be achieved for every
financial year. Goal (with respect to organizations) is nothing but how an organization
should be end of the year. All the employees of the organization are educated on the goals
to work towards it. The end result is evaluated based on the goals achieved.
Technical Skills:
It is really important for an employee to be proficient regarding his/her technical expertise
before getting handle on work. Technical skills do not just pertain to IT services alone
where an employee should be sound enough in his/her particular work domain (either
programming language or operating system). It spreads across every organization (w.r.t
financial/banking services, one should be technically proficient handling accounts; a
business analyst must be technically sound in analytics and reports, etc.)
Soft Skills:
It is very essential as every employee will have to speak to clients/handle client calls,
narrate the product description, walk clients through the work flow, etc.

Compensation:
Compensation is a systematic approach to providing monetary value to employees in exchange
for work performed. Compensation may achieve several purposes assisting in recruitment, job
performance, and job satisfaction.

Forced distribution:
Forced distribution is a method of employee performance appraisal that many companies use. We
also call it the forced distribution method, stacked ranking, or bell-curve rating. It is a rating system
that employers use to evaluate their workers. The forced distribution method has some advantages
and disadvantages. Although forced distribution is extremely popular among companies, it is
somewhat controversial among HR experts.

Behavioral system:
In this kind of system if employees behave well in airlines with the consumers they
get different kind of bounces and perks based on there qualities.

Goal orientation:

Goal orientation is the degree to which a person or organization focuses on tasks

and the end results of those tasks. Strong goal orientation advocates a focus on the ends
that the tasks are made for instead of the tasks themselves and how those ends will affect
either the person or the entire company.

Person focused pay:

Person focused pay programs are not for all organizations or all positions. The
model implies that employees need to move away from viewing pay as an
entitlement. Person focused pay programs treat compensation as a reward earned for
acquiring and implementing job relevant knowledge and skills.