Employee benefits are all costs that the employer incurs on the basis of a labor agreement. On the one hand, the process of determining payments should take into account the activities of the employee, and on the other, be the motivation to achieve the required level of his activity.
The essence of the concept
The fundamental role for any employee has a material reward. However, it does not achieve its goals, if some other factors are not taken into account. Material rewards - this is one of the types of rewards that must certainly be combined with interesting work and recognition of the team. A prerequisite is the creation of comfortable working conditions, promotion, etc.
On the one hand, material motivation is seen as a means that can satisfy physiological needs, as well as maintain safety. On the other hand, the size of wages is certainly a reflection of the level of the position held in the team and the degree of respect.
Thus, a decent remuneration for work is a consequence of the employee’s high appreciation, his special status and prestige. Sometimes wages themselves are seen as a source of self-esteem.
Rewards are all that is valued by man. That is why this concept is specific for everyone. In this regard, the assessment of remuneration by its significance is also different for each person.
Main forms
All types of rewards are divided into internal and external. The first of these is given to man by the work itself. It allows you to feel a sense of content, achieving results, as well as self-esteem. The internal remuneration can also be considered the communication that occurs among workers in the course of labor activity.
The second type of incentive is provided by the organization itself. This is career advancement, and recognition, and praise from superiors, and wages. External benefits include additional holidays, insurance, etc. This can also include social and pension benefits, time for lunch and rest, and so on.
In this case, the payment of employee benefits is not only compensation for their work. This is gratitude for their contribution to the production process, which affects the ability of the organization’s management to attract, retain and motivate the personnel necessary for it.
Types of material incentives
Material rewards are payments made in the form of bonuses and salaries, as well as additional incentives.
All existing types of premiums are classified in two directions. The first of them includes additional payments made for length of service. For the second category, each enterprise is developing its own remuneration system. It provides for payments for various merits.
Cash compensation in the form of allowances and payments can be challenging and compensatory. The first category includes:
- premiums;
- premiums to tariff rates for workers or official salaries for employees and specialists;
- encouragement over the years;
- lump-sum payments for length of service;
- other incentive incentives provided for high production results.
All these rewards are determined by each organization independently. In this case, the conditions and amounts of payments should be determined by collective agreements.
As for surcharges and allowances of a compensatory nature, they are divided into two large groups.
The first of them includes those types of incentives that are not limited to areas of work. Compensation fees are required to be paid to enterprises of any form of ownership.
The second group includes allowances and surcharges, which are calculated in a certain area of ​​labor application. Most of them are also mandatory. But it is worth bearing in mind that their specific size is set by the employer.
Compulsory Compensation Incentives
Remuneration to employees that the employer pays, based on current legislation, is the following surcharges:
- minor employees in connection with the need to reduce their working day;
- for work on holidays and weekends, as well as overtime;
- upon the release of marriage or failure to comply with the required production standards, which occurred through no fault of the employee;
- to the average salary for deviations from normal conditions of the production process;
- to a worker up to the rank assigned to him, if he was sent to carry out a task corresponding to a lower qualification.
Other compensation payments
The remaining types of allowances differ in a limited form of application. Some of them can be installed to compensate for work that is not directly related to the basic duties of the employee. An example of this is the endowment of the functions of a leader in parallel with the execution of one’s circle of affairs. Other allowances are paid under harmful working conditions.
Reward Features
The head of the organization will certainly evaluate the professional activities of each of his employees. It affects the amount of accrued rewards. Systems of such assessments may be different. However, they have one goal. They distinguish between employees who work well, satisfactorily and mediocre. Depending on what category the members of the labor collective fall into, and rewards are awarded.
Most organizations in modern conditions conduct annual interviews or certification of their employees for such an assessment. The size of the rewards depends on their results.
Employee benefits
The remuneration system that exists in any organization consists of three main elements. First of all, this is the main pay for labor. She is considered the base salary. Two other elements are additional payments (bonuses, bonuses, etc.) and social benefits.
Remuneration for work is a constant part of cash payments for the employee. She is counted for the performance of permanent duties provided for in the job description. The remuneration for labor in terms of the base salary consists of the salary stipulated by the staff list and various allowances. At the same time, the size of the official salary depends on the position or tariff category. Premiums are introduced to account for the individual contribution of the employee to the production process. They are counted, as a rule, as a percentage of the existing salary. Extra charges can be established for the length of service and for the knowledge of a foreign language, as well as for the effectiveness of activities, etc.
Amount of employee benefits
Basic rewards are payments that remain unchanged for a fairly long period. Moreover, they do not directly depend on the results of the employee’s labor activity.
The size of the variable part of the salary may depend on the manufacture of each unit of production, for which the employee has the fixed remuneration established by the organization. Such payments can be determined by a system of sales promotion or commission.
The size of the variable part of the salary can be calculated as a percentage of its base component. In this case, they connect the amount of the received cash reward with the performance of the entire company. A similar system is being developed for those categories of workers for which there are no quantitative performance criteria. Their list includes accountants and managers, lawyers and business executives, etc.
The ratio between the fixed and variable parts of the cash reward may be different. It is determined by the head of the organization, based on the result and the efforts made by the employee. In this case, the increased remuneration for labor may take the form of gratitude to the company for its staff. For example, with a large volume of sales, sales managers can be charged 60, 70 or 80% of the base salary.
Incentive for inventors
A specialist may spend some time creating an industrial property. As a result, the organization pays him royalties. This type of incentive has the nature of remuneration and it has inherent stimulating and compensating features.
On the one hand, royalties increase the employee's interest in working to further improve his invention. And on the other hand, they compensate for moral losses from the realization of the impossibility of owning product rights.