Unit 4: Reward System
Reward System
Compensation refers to the monetary and non-monetary rewards given to employees in exchange for their work. It includes salary, wages, incentives, bonuses, benefits, and perks.
It is a key part of the reward system, which aims to motivate, attract, and retain employees.
Functions of Compensation
Job Evaluation
Job Evaluation is the process of systematically determining the value or
worth of a job in relation to other jobs in an organization. It helps in
setting fair compensation based on job responsibilities, not the person
doing the job.
Methods of Job Evaluation
Job evaluation methods are classified into two major types:
1. Non-Analytical Methods (Traditional, easier but less detailed)
2. Analytical Methods (More detailed and objective)
Summary Table
Inputs to Job Evaluation
These are the essential components or data required to conduct an effective job evaluation
Practical Implications
For Technical and Non-Technical Positions:
For Executive and Managerial Positions:
Significance of Wage Differentials
Wage Differentials refer to the difference in wages for different jobs or
individuals based on various factors.
🔹 Importance
Summary Table
