Accounting technicians scheme west africa
A.15.1 Objectives of Wages and Salary Administration
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- A.15.2 Principles of Wages and Salary Administration
- Government Minimum Wages
- Terms of Collective Agreement
- Qualifications
| A.15.1 Objectives of Wages and Salary Administration The main objective of wage and salary administration is to establish and maintain an equitable wage and salary system. This is so because only a properly developed compensation system enables an employer to attract, obtain, retain and motivate people of required calibre and qualification in his/her organisation. Core objectives of wages and salary administration in any organisation are embedded in the following activities a) Reward employees according to the effect and merit. b) Attract and retain the services of desirable employees. c) Get improved employee morale and productivity. d) Keep labour cost within reasonable limits so as to safeguard the interests of shareholders, competitive worth of the org and its product and profitability. e) Pay employee according to the importance and difficulty of the job. f) Facilities payroll administration, budgeting and wage and salary control. g) Explain to the employees how and why they are paid. A.15.2 Principles of Wages and Salary Administration When establishing the general level and structure of wages and salaries in an organisation, the following factors are taken into consideration i) Ability to Pay: Since wages and salaries are paid out of the revenue of the organisation, the compensation given to employees must be determined by the level of its financial performance. An organisation which offers higher wages and salaries than it can afford risks losing its competitiveness in the industry. ii) Government Minimum Wages: The level of wages and salaries inmost private or public sector organisations is influenced by government minimum wage legislation. iii) Wages and Salaries paid by competitors. The level of wages and salaries paid by organisations in the private sector is sometimes influenced by the rates paid by competitors. iv) Terms of Collective Agreement: In unionized organisations, the level of wages paid by employers is governed by the collective bargaining agreement signed between employee 208 associations and management. vb Availability of that Type of Labour: The compensation paid to specific employees maybe influenced by the scarcity or otherwise of the skills possessed by these employees. Where the skills are scarce in the labour market, employers are often prepared to offer higher compensation to attract and retain such employees. vi) Qualifications: Some organisations wages and salary structure are closely tied to the qualification of employees. The higher the qualification the better the pay. vii) Download 3.37 Mb. Share with your friends:
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