Reward & Pay Plan

The Ultimate Remainders

The only easy day was yesterday

Name ID
Karimul Hoque (GL) 1163
Md Kamruzzaman 1181
Md. Mohiuddin (GL) 1175
Md. Eyasin Arafat 1169
Md. Mostafizur Rahman 1178
Table of Content
What Is Payment

The Concept and Definition of Reward

Types of Reward Plans

Intrinsic versus Extrinsic Rewards

Financial versus Nonfinancial Rewards

Performance-based versus Membership-Based Rewards

Job Evaluation Methods

Government Influence on Compensation Administration
Special Cases of Compensation
Executive Compensation Programs

International Compensation

Payment and reward scenario in Bangladesh

Government sector

Local private organizations

Reward packages of Jamuna bank ltd.

Compensation and benefits package of ACI Limited

Compensation Management Practice at Singer Bangladesh Ltd.

Salary Structure of Chevron

MNCs Are More Employee Oriented Than Local & Government Organizations
What Is Payment?
Payment refers to give money in return for services rendered.

According to Investopedia

“payment is the transfer of one form of goods, services, or financial assets in exchange for another form
of goods, services, or financial assets in acceptable proportions that have been previously agreed upon by
all parties involved. Payment can be made in the form of funds, assets or services.”

According to business dictionary,

“Compensation, discharge or performance of an obligation, or reimbursement, by giving over something

that is of satisfactory value to its recipient, such as money.”

According to Collins dictionary,

“A payment is an amount of money that is paid to someone, or the act of paying this money.”

The Concept and Definition of Reward

Reward is the generic term for the totality of financial and non-financial compensation or total
remuneration paid to an employee in recognition of their services, efforts, or achievements.

Reward, which is sometimes been refer to as compensation or remuneration, is perhaps the most
important contract term in every paid-employment. Its impact on workers (or employee’s) performance is
in most instance greatly misinterpreted. The understanding of this term is very important; this is because
the incentive scheme given to an employee will influence the behaviour and level of engagement to the
organisation.

According to Armstrong (2010) reward management is defined “as the strategies, policies and processes
required to ensure that the value of people and the contribution they make to achieving organization,
departmental and team goals is recognized and rewarded”.

Armstrong and Murlis (2004 p3) defined reward management “as the process of formulating and
implementation of strategies and policies that aim to reward people fairly, equitably and constantly in
accordance with their value to the organization. It also deals with the design, implementation and
maintain of reward processes and practices that are geared towards the improvement of organizational,
team and individual performance”.

Literally, according to the above definitions reward management is a motivational tools use in
appreciating employees on the efforts contributed to the organisation. Which means reward could be
interchanged as compensation or remuneration or explicit price of labour.
Types of Reward Plans: People do what they do to satisfy some need and they look for a payoff or
reward. The most obvious reward is pay, but there are many others, including:

 promotions
 desirable work assignments
 peer recognition
 work freedom
Figure shows the variety of reward mechanisms organizations may use

Source:Fundamentals of Human Resource Management,DeCenzo and Robbins, Eighth Edition

Intrinsic versus Extrinsic Rewards
Intrinsic rewards (personal satisfactions) come from the job itself, such as:
 pride in one’s work
 feelings of accomplishment
 being part of a work team
Extrinsic rewards come from a source outside the job
 include rewards offered mainly by management

 Money

 Promotions

 Benefits

Financial versus Nonfinancial Rewards

Financial rewards include:

 wages

 bonuses

 profit sharing

 pension plans

 paid leaves

 purchase discounts

Nonfinancial rewards emphasize making life on the job more attractive; employees vary greatly on what
types they find desirable.

Performance-based versus Membership-Based Rewards

Performance-based rewards are tied to specific job performance criteria.

 commissions

 piecework pay plans

 incentive systems

 group bonuses
  merit pay

Membership-based rewards such as cost-of-living increases, benefits, and salary increases are offered
to all employees.

Compensation Administration: The process of managing a compensation program so that the

organization can attract, motivate and retain competent employees who perceive that the program is fair.
The factors of Compensation Administration are being mentioned and described below;

Job evaluation: the process used to determine each job’s appropriate worth within the organization.

 Based on job analysis information.

Job Evaluation Methods:

Ordering method: A committee places jobs in a simple rank order from highest (worth highest pay) to
lowest.

Classification method:

 Jobs are placed in classification grades

 Compare their descriptions to the classification description and benchmarked jobs
 Look for a common denominator such as skills, knowledge, or responsibility
Point method:

 Jobs are rated and allocated points on several identifiable criteria, using clearly defined
rating scales.
 Jobs with similar point totals are placed in similar pay grades.
 Offers the greatest stability.
Government Influence on Compensation Administration:

a) Fair Labor Standards Act: 1938 act which requires

I. minimum wage

II. overtime pay

III. record-keeping

IV. child labor restrictions

Exempt employees

 include professional and managerial employees

 not covered under FLSA overtime provisions

Nonexempt employees

 eligible for premium pay (time and one-half)

 when they work more than 40 hours in a week

b) Equal Pay Act:

Equal Pay Act of 1963 act requires that men and women hired for the same job be paid the same.

c) Civil Rights Act:

 broader than Equal Pay Act
 prohibits discrimination on the basis of gender
 used to support comparable worth concept
 Salaries should be established on the basis of skill, responsibility, effort, and working conditions.

Special Cases of Compensation:

 Incentive Compensation Plans:

Incentives can be added to the basic pay structure to provide rewards for performance.

Source:Fundamentals of Human Resource Management,DeCenzo and Robbins, Eighth Edition

Individual Incentives include

• Merit pay plans (annual increase, based on performance)

 • Piecework plans (pay based on number of units produced typically in a specified time
period)
• Time-savings bonuses and commissions

These work best where clear objectives are set and tasks are independent.
 Group Incentives: Incentives can be offered to groups, rather than individuals, when employees'
tasks are interdependent and require cooperation.

 Plant-wide Incentives: Direct employee efforts toward organizational goals (such as cost
reduction)
Scanlon Plan - supervisor and employee committees suggest labor-saving improvements
Improshare - formula is used to determine bonuses based on labor cost savings

 Paying for Performance :

Pay is based on some measure of performance.Common performance measures are:
piece-rate plans
gainsharing
wage incentive plans
profit sharing
lump sum bonuses
 Competency-based compensation :Rewarded for skills, knowledge and behaviors such as ,
• leadership
• problem solving
• decision making
• strategic planning
Broad-banding - pre-set pay levels that determine what people are paid based upon the type and level of
competencies they possess.

 Team-Based Compensation: Incentives for empowered work teams to exceed established goals
and share equally in rewards. It Depends on:
 clarity of team purpose and goals
 ability of the team to obtain needed resources
 effective team communication skills and trust
Executive Compensation Programs:

A. Salaries of Top Managers:

– Executive salaries, bonuses and stock options may seem high.
– Top twenty CEOs average more than $100 million in total compensation.
– Competition for executive talent raises the price of hiring an executive.
– High salaries can be a motivator for executives and lower-level managers

B. Supplemental Financial Compensation

– Deferred bonuses – paid to executives over extended time periods, to encourage them to
stay with the company.
– Stock options – allow executives to purchase stock in the future at a fixed price.
– Hiring bonuses – compensate for the deferred compensation lost when leaving a former
company.

C. Supplemental Nonfinancial Compensation

International Compensation: Important to understand the statutory requirements of each country.
International compensation packages generally utilize the “balance-sheet approach,” using the four
factors below:
 Base Pay
 Differentials
 Incentives
 Assistance Programs

• Base Pay: The pay of employees in comparable jobs at home.

• Differentials: Compensation given to offset higher costs of living abroad.
• Incentives: Inducements given to encourage employees to accept overseas assignments.
• Assistance Programs: Payment for expenses involved in moving a family abroad and in
providing some services overseas.

Payment and reward scenario in Bangladesh

Government sector:

Rewards & pay plans in govt. sector:

 Basic pay (20 grades)

 Pension
 Paid holiday
 Increment (available after 6 months)
 Health allowance (1500 tk) above 65(2500 tk)
 Noboborsho Allowance (20% of basic)
 House allowance
 Tiffin allowance (200 tk)
 Recreation allowance
 Transportation (monthly 300)
 Hill allowance (20%)
 Bleach allowance (Monthly 100)
 Hospitality allowance
 Domestic aid allowance (3000 tk)
Basic pay:

Source : 8th national pay scale.

House allowance:

Basic pay Dhaka City Divisional city, Gazipur others

and avar

Till 9700
From 9701 to 16000
From 16001 to 35500
35501 and avove
Source : 8th national pay scale.
65% and not less then 55% and not less then 50% and not less then
5600 5000 4500
60% and not less then 50% and not less then 45% and not less then
6400 5400 4800
55% and not less then 45% and not less then 40% and not less 7000
9600 8000
55% and not less then 40% and not less then 35% and not less then
19500 16000 13800

Hospitality allowance:
Chief Secretary 2000 (two thousand) Taka;
Senior Secretary / Secretary 1000 (one thousand) tk.
Additional Secretary 900(Nine Hundred) Taka
Joint-Secretariat / A New Jurisdiction Employees receive a monthly salary of 600 (six hundred) tk.
Local private organizations:

Part 1: Law 2006 & Labor Rule 2015

Part 2: Real examples

Compensation policy according to Labor Law 2006 & Labor Rule 2015;

Provident fund:

 All confirmed and permanent employees will be entitled to be members of the Provident Fund.
 The employee contribution, equal to 10% of the basic salary, will be deducted each month
through the payroll.

Gratuity:

 Anybody who has served any organization for more than 5 years will be eligible for Gratuity
 Employee’s last drawn salary would be multiplied with the number of years of service and paid
out when the leave an organization after years of service.
 Provided by the organization when an employee will leave from the organization
Festival bonus:

 This bonus should be given on the basis of basic salary.

 Bonus should be 100% of the basic salary.

Allowances:

Medical facilities:

Where any worker serves notice of any accident, the employer shall, within 3 days from the date of the
service of notice, get the worker examined by a registered physician free of cost and such worker shall
present himself for such examination.

Leave Entitlements:
 Basic Leave
 Maternity leave
 Study leave
 Hajj leave
 Special leave
 Leave Encashment
Basic Leave types:
Types of Leave Days Per Year

Weekends (with full wages) One day & a half

Casual Leave (with full wages) 15

Sick Leave (with full wages) 10

Earned Leave 15

Public Holidays As per declared government holidays

Have to be paid with payment

Maternity Leave:

 Six weeks or 42 days immediately preceding and including the day of delivery.
 Six weeks or 42 days immediately following the day of delivery.
 A woman shall not be entitled to maternity leave unless she has been employed by the Company
for a period of not less than nine months immediately preceding the date of delivery.
 The maternity leave will not exceed more than 16 weeks

Hajj leave:
 45 days
 Once in the entire period of service.

Special Leave:

 Application for special leave should be forwarded to HR/Personnel department, through the
relevant departmental head, along with appropriate reasons and recommendations for necessary
action.
 Some examples of such leave request may be for marriage, death in the family, etc.

Leave Encashment:
Executives before leaving the Company due to resignation, retirement or termination are allowed to cash
the Earned and Compensatory Leave due to them up to a maximum of 30 days, while for workers it is 20
days plus the prorated entitlement for the current year. The amount paid on encashment includes only the
employee's last drawn basic salary for the period.

Reward packages of Jamuna bank ltd.

Jamuna Bank Limited is a commercial bank in Bangladesh registered under the Companies Act 1994. It
was established on June 3, 2001. Jamuna Bank had 132 branches as of March,2019 . Its head office is
located at Hadi Mansion, 2, Dilkusha C/A, Dhaka-1000, Bangladesh. Jamuna Bank Ltd is a 3rd
generation private commercial bank, was established by a group of local entrepreneurs. The bank, aside
from conventional, also provides Islamic banking through designated branches. The Bank has real-time
online banking branches (of both urban and rural areas) network to provide online banking.

The Bank is committed to follow a fair, competitive and flexible remuneration policy. The Board is the
final authority for approval of this policy and will amend and review the policy on recommendation of the
Managing Director / Management Committee periodically. The remuneration policy of the bank will
cover all persons engaged in permanent service of the bank.

The different job grades at Jamuna Bank are as follows:

  Managing Director
 Associate Managing Director
 Deputy Managing Director
 Senior Executive Vice President
 Executive Vice President
 Senior Vice President
 Vice President
 Senior Assistant Vice President
 Assistant Vice President
 First Assistant and Vice President
 Senior Executive Officer
 Executive Officer
 First Executive Officer
 Officer
 First Officer
 Assistant Officer

Basic pay:
Salaries are confidential between the employees concerned and the Management. The salary ranges for
these job grades are reviewed from time to time. HR Temporary & outsource staff do not have any
assigned job grade. The contracts get a consolidated payment per month and there are no other
entitlements applicable except commission based on job criteria.

Basic Salary Ranges (BSRs) is commensurate with the job grades and is determined by the Board on the
recommendation of the Managing Director. The Board reviews the BSR at least once every two/three
years.
  Annual increment: All confirmed staffs get increment each and every year based on their level.

 Advance payment: If someone goes outside of office and there is no chance of coming back
within that month ,he/she will be given advance payment salary .

Festival Bonus

All regular and confirmed employees get two bonuses each year. One in Eid-Ul-Fitr and another during
Eid-Ul-Azha only for Muslims and employees of different religion gets that bonus during their respective
religious festival.

Festival Bonus will be paid to all confirmed officers/staff at one month basic salary which will be
reimbursed twice in each calendar year. All confirmed employees would get one bonus during Eid-ul-
Fitre and another one for Muslims during Eid-ul-Azha and for others based on their respective religious
festival.

Non-confirmed employees will be entitled to get Festival bonus as pro rata basis depending on his/her
joining Date. Outsource Staff would get 1 bonus, which is 50% of this gross salary

Type of Leave Granted:

 Sick Leave: 14 days sick leave with pay is provided to the staffs of JAMUNA each and every
year.

 Maternity Leave: JAMUNA provides 6 months with pay maternity leave to its female staffs.
Extra 6 months non paid maternity leave is also given to the staffs of JBL

 Paternity Leave: 7 days paternity leave is given to the all confirmed staffs of JBL at a stretch.
Non confirmed staffs are not eligible to get this leave.

 Accidental Leave: Every employee can take this leave due to accident in work place, in case of
hospitalized because of accident or surgery issues. JBL gives 21 days with pay accidental leave
for accidental or surgical issue to its staff. If required more leave, staffs of JBL can take more
days leave but that will be given as without pay. For certain cases authority provides 21 day’s
extra leave.

 Compulsory leave: Those who work five days in a week they get 5 days compulsory leave in a
year at a stretch.
  Extra ordinary leave: It is without pay leave. To get this leave staffs must work for JBL at least
5 years. Those who work 5 years they are given 1 year extra ordinary leave at a stretch. Those
who work 10 years or more they are given 2 years extra ordinary leave at a stretch.

Benefits:

 Gratuity: The Gratuity Fund is a terminal benefit that an employee receives at the time of
retirement/resignation.

Eligibility: Regular confirmed employees who have completed at least 5 Years continuous service are
entitled to receive Gratuity Benefit.

 Security Fund: The objective of the fund is to provide predetermined monetary benefit against
death and permanent disability of regular confirmed staff to his/her Dependent/Heir/Nominee by
the Bank. All Regular Confirmed employees are eligible to avail this benefit. The fund for this
benefit is created solely with The Bank’s Contribution. The Bank will contribute Taka
5.00/Thousand on a yearly basis against the last basic salary of each eligible employee. (The rate
of contribution may be changed subject to the approval of the board.) The Bank maintains a
liability account to manage the fund. The total amount of benefit will be equal to 36 times of the
last basic salary of the employee.

 Provident Fund: The Jamuna Bank employees’ provident fund requires the employer i.e. Jamuna
Bank Limited to contribute to the fund 10% of basic salary for all regular confirmed employees.
Every member of this fund on retirement is provided with a sum of money as determined by the
established rules for the fund on retirement or resignation from his or her services. A board of
trustee is entrusted with the control, management and investment of the fund.

Types of Loan granted:

  Staff Loan: Staff loan is granted to regular confirmed employees of the bank. The duration of
service of the employee has to be at least a year long. The employee can apply for loan extending
up to 5 times of his/her gross salary at 10 % interest rate.

 Car Loan Scheme: The car loan facility is extended to employees of or above the grade PO. The
amount of loan that these employees can take obviously varies according to their respective job
grades. Principal and Senior Principal Officers can take loan amounting to Tk.800, 000 AVP,
FAVP, SAVP can file for loan amounting to Tk.10, 00, 000 VP and SVP can file for loan
extending up to Tk 14, 00,000

 House Building loan: Employees who have had a service length of 5 years and above are
eligible to apply for house building loan. A committee will oversee the loan application and
monitor the location for house building the debt burden ration of the employee and other relevant
issues. The debt burden ratio for the employee has to be 50% or below for the loan to be
approved. The repayment schedule for the loan has to be before the retirement of the employee.
The interest rate of the loan is 3%.

 Termination Benefit: In case a confirmed employee is asked to resign from his/her services by
the relevant authority without stating any reason, he/she is eligible to receive one month’s notice
in writing or one month’s gross salary as payment. If the employee is duly notified with one
month’s notice, he/she will not be entitled to receive any form of compensation for the
termination of service

Compensation and benefits package of ACI Limited

 Compensation is really very important matter for any business organization. For any business
organization, the employees who make up the workforce are very important. It is also very important to
make an attractive compensation package for these employees. The compensation package must be very
attractive to increase the image of the organization as well as to retain the employees with the
organization.

ACI Limited is also following a compensation package that helps them to retain the full-time employees
and the casuals. Though they are on a track to compensate the employees in a competitive manner, but
they try to give a bit higher salaries and wages to the employees to remain as a competitive organization
in the market.

They judge the job positions first and then they go for the study of the same categorized job position in
the other organizations, and see the pay level of these positions. Then, ACI Limited decides that how
much will be paid to the positions that they are defining or examining. In this case ACI Limited tries to be
very fair about the pay levels. They try to fix the pay level in such a manner that is fair and effective for
them and to the employees too.

Allowances Incentives / Benefits

Office Management Staff Field Staff Office Management Staff Field Staff

▪ House Rent allowance ▪ House Rent Quarterly/Yearly: Quarterly/ Yearly:

(100% of basic) allowance (100% of
▪ Yearly Leave Fare ▪ Yearly Leave Fare
▪ Medical allowance (50% basic)
Assistance. (60% of basic) Assistance. (50% of
of basic)
▪ Medical allowance basic)
▪ Transport allowance (50% ▪ Yearly two festival
(100% of
of basic) ▪ Yearly two festival
bonuses. (100% of basic)
▪ Lunch allowance basic) bonuses. (100% of basic)
(Tk.1100 to Tk. 1500) ▪ Yearly performance
▪ Transport allowance ▪ Yearly workers
▪ Utility allowance
(50% of bonuses (50% of basic)
(50% of basic) Participation funds (50%
basic) ▪ Yearly workers of basic)

▪ Utility allowance participation Fund. ▪ Quarterly sales

incentive. (Not fixed)
(50% of basic) (50% of basic)
 Long Term: Long Term:

▪ Provident fund. ▪ Provident Fund.

▪ Gratuity. ▪ Gratuity.

▪ Group Insurance Policy. ▪ Group Insurance Policy.

▪ Medical Benefits. ▪ Medical Benefits.

Employee Benefits plan of ACI Limited

Employee benefits plan is the most important part of an organization. It is motivated to employee. ACI
Limited continually evaluates and reviews its employee benefits plan to ensure that benefits are
competitive. Employee benefits plan are:

1. To establish wage & salary plan of ACI Limited employees: Wage & salary plan comprises the
following components:
 ACI has a competitive monthly total base salary.
 The company follows an annual performance-based salary increment.
 Performance bonus is available in ACI.

ACI Limited also provides night shift premium, incentive, festive advance, transport reimbursement etc.

2. To implement employee incentive plan of ACI Limited:

 Quality of work output. (How many units produced)
 Quality of work output (What was the quality of the product or service being
produced or served)
 Monthly sales. (How much sales were generated)
 Work safety record. (How many hazard or errors are being reduced)
 Work attendance (If the absent is reduced or attendance is good)
3. To ensure health & medical allowance plan of ACI Limited employees: All employees of ACI
will receive a monthly medical allowance as per respective grade of the employee. The allowance
will be paid together with the employee’s monthly salary and for this no receipt needs to be
submitted.
 4. To make sure effective Provident fund plan of ACI Limited employees: Permanent employees of
ACI Limited are eligible to become members of the provident fund. Employees contribute 10% of
their basic to the provident fund and the company makes equal contribution to the fund.
5. To make situation demanding profit sharing plan of ACI Limited employees: There are some
employees who prefer to feel a sense of ownership; this also gives them direct reason to want to see
the company succeed because they are financially invested. As a means to invigorate many
companies offer profit sharing as a reward for strong motivation in a job well done.
6. To provide flexible-time benefits plan for employees in order to ensure their right: Many
employees want Alternative work schedules. Sometimes employees flourish on different kinds of
work schedules as opposed to the traditional (and often monotonous) 9to 5 schedules.
7. To set up leave for marriage, maternity leave, sickness leave and vacation leave plan of ACI
Limited employees: ACI also has paid leave for marriage, maternity, sickness and vacation plan.
8. To establish gratuity plan of ACI Limited employees: ACI has gratuity plan. Gratuity is
considered as long-term financial benefit for employees. Payable at the time of leaving the company
upon completion of at least 8 years of continuous service. The employee will receive an allowance
equal to his/her last drawn basic for each completed year of service.
9. To cover all employees under the group life insurance plan: ACI Limited provides insurance
coverage for partial or permanent disability and death under group life insurance.
10. To concentrate on the Leave benefits plan of ACI Limited employees: ACI limited all
management staff will have the following leave entitlement in a calendar year. Privilege leave: 24
days Sick leave: 14 days.

Various Allowances of ACI Limited:

Different types of allowances given on the basis of s alary in ACI Limited:

Salary & Benefits Employee Designation

Office Management Staff Field Staff

Basic Salary 5500-57000 3000-8500

House Rent 100% of basic 100% of basic

allowance

Medical allowances 50% of basic 100% of basic

Transport allowances 50% of basic 50% of basic

Lunch allowance Tk.1100 to Tk.1500 ----------

Utility allowance 50% of basic 50% of basic

Compensation Management Practice at Singer Bangladesh Ltd.

Performance Based Evaluation Measure:

Singer always tries to give the better service to their customers. As for this they try to find out the best
employees compare with their rival companies. The HRD of singer not only provide training to the
employees but also goes for measurement of the performance before and after training. HRD goes for two
types of methods:

a) Post-training performance method

b) Pre-post training performance method

According to the post-training performance method HRD evaluate the training programs based on how
well employees can perform their job in the position Singer provides to after training. Under pre-post
training performance method HRD of Singer evaluate the training programs based on the difference in
performance before and after training.

Compensation Systems

It is a big issue to compensate the employees because each and every employee has some extra
capabilities which make him/her different from the other employees as well as reducing the lacking that
make him/her away from the race of reward system.

For making a fair compensation system, HRD of Singer follows some factors of the employees. Those
are:

1) Mental efforts: intelligence, memory, verbal expression, specialized Knowledge, communications.

2) Physical efforts: height, weight, strength, working hours

3) Skills: experience, training, education, ability to perform the given task

4) Responsibilities: how much the employee responsible to perform the job, how willful he/she is?

All this above factor is considered while the HRD are going to compensate any employees. His past (if
has) and present records of the works are evaluated for making a fair compensation package.
Types of Compensation provided by Singer Bangladesh Ltd

HRD of Singer Bangladesh provides both direct and indirect compensation to their employees. HRD tries
to match with the environment of the current situation and the needs of the employees. Cluster with all
that HRD gets the decision whether they give direct or indirect compensation benefit.

Direct compensation

Merit Pay Spouses Income Continuation

Direct
Compensation
Benefits

Gain sharing Profit sharing

Figure: Direct Compensation provided by Singer

a) Merit pay: If sometimes any employee did any unexpected work which can not be possible for
other employees and to did that should have some additional knowledge on that cases HRD of
Singer give direct financial support to that employee to motivate both that employees and all
others of the company.

b) Spouse income continuation: If any uncertainties arise that a employee of Singer can not able to
work due to his disable situation most of the cases Singer tries to stand beside the family of that
employee.

c) Gain sharing: When a group of people did anything extremely well and make a huge financial
profit sometimes Singer gives some percentage from that profit equally to each and every
members of the group. By doing this employee are being motivated to work as a team to gain the
competitive advantage.
 d) Profit sharing: Basically, it is not happening regularly and if it so than only the percentage of the
profit is distributed to the top-level management Officers.

Indirect Compensation benefits:

Singer not only gives the direct compensation but also compensate their employees indirectly. Company
gives so many facilities for the employees to become a friendly relation with the management and the
employees.

Protection Services and

Others
programs prerequisites

Figure: Indirect compensation by Singer

a. Protection programs: HRD of Singer provides protection programs like Medical Insurance, Life
Insurance, Social Security etc.
b. Services and prerequisites: Services that Singer gives to the employees are recreational
facilities, car facilities according to the designation etc.
c. Others: Employees of Singer enjoy holiday facilities, sick leave, vacation etc.

Rewards System

Singer is very much concern about the reward system of the employees. Because all the time Singer
believes that no more Singer in the world would exist if each and every single employee are not satisfied
while doing their job in the company. Singer always try to give some rewards which will cheer up the
employees and makes them more attract on their own field. Basically, singer gives two types of rewards
towards the employees.
1) Intrinsic reward

2) Extrinsic reward

Under intrinsic reward employees are not allowed to enjoy financial benefits from the company. For top
level or upper mid-level employees can go for a) decision making (while unexpected situation arises) b)
personal development by getting training without any expense c) job freedom.

Under extrinsic reward employees get financial rewards. But sometimes they have the chance to get some
additional benefits by the company.
 Salary Structure of Chevron:

Other Benefits of Chevron:

1. Handsome salary: Chevron offers its employee a handsome salary. For that reason employee get mental
satisfaction by working in this organization.
2. Incentives: The Chevron Incentive Plan (CIP) is a once per year bonus that is paid by Chevron and is
determined by the performance of the Company, Business Unit, and the employee.
3. Fringe Benefits: Chevron Corporation employees are provided with several options for retirement and
welfare benefits. Numerous American employers, like Chevron Corporation, provide group health insurance,
through which companies typically pay a large portion of their workers' health insurance premiums. These
contributions are tax deductible for employers and tax-free for employees. Chevron Corporation offers health,
dental, and vision coverage. Chevron Corporation also offers long-term disability insurance, group life
insurance, death benefits, which cover certain causes of death, and short-term disability insurance for
accidents or illness. To help secure a stable flow of income later in life, countless employees take advantage
of employer-provided retirement plans. Chevron Corporation offers defined benefit pension plans and defined
contribution pension plans. A defined benefit pension plan pays retirees a predetermined amount upon
retirement. With a defined contribution pension plan, businesses help workers save and invest for retirement.
 Benefits Summary:
Retirement & Financial Benefits

 Profit Sharing
 Defined Benefit Pension Plan
 Defined Contribution Pension Plan

Health & Insurance Benefits

 Long-term Disability Insurance

 Life Insurance
 Severance Pay
 Health Insurance
 Dental Insurance
 Vision Insurance
 Accidental Death & Dismemberment Insurance
 Temporary Disability Insurance

Perquisites: Chevron normally provides the following facilities to its Managerial personnel to facilitate their
job performance and to retain them in the organization.

 Company Car
 Club membership
 Free residential Accommodation
 Paid holiday trips
 Stock options

Rewards system of chevron:

Intrinsic Reward
- More Responsibility
- Diversified Work
- Decision Making Power
Extrinsic Reward
- Performance Based
- Implied Membership Based
- Explicit Membership Based

MNCs Are More Employee Oriented Than Local & Government Organizations:

1. In Government Sector:
 Promotion Growth Is Traditional
 No Profit Sharing
 No Performance Bonus
 Will Take a Long Time to Get Car/Flat Facility
 Intrinsic Reward is Low
  Security is higher

2. In Private Sector:
 Scenario is comparatively better
 Job security is high/moderate

3. In MNCs:
 All is Standard and higher
 Maximum rewards
 Job security is low