Jahangirnagar University: Submitted To

JAHANGIRNAGAR UNIVERSITY
Course Title: Compensation Management

Mid Term
Course code: MHRDIR 506
Submitted To
Nusrat Jahan Arefin
Assistant Professor
Department of Public Administration
Jahangirnagar University
Submitted By
Asif Hasan
Roll- 210116
Department of Public Administration
Jahangirnagar University
Date of Submission:
8th July 2021
1
Ans to the Question No- 1
There are four perspectives of compensation: Society, Stockholder,

Manager, and Employee. Each perspective creates a different idea of what
compensation means to them and the organization.
Perspective in society is seen as a measure of justice. Society sees that
compensation should be based off of their qualifications, education, and
experience. Society also wants compensation in the form of benefits such
as raises, health care, and bonuses but does not often see this as
compensation because it is not money going directly into their pocket,
even though it is money coming from the business to provide those
services.
As a stockholder compensation is seen as all payments going to an
employee, including the benefits. Stockholders often have a vote on the
compensation plan.
Managers control labor which can account for how much of the
company’s cost is being applied to labor, and not a profit. For managers,
compensation is a number that they must keep in a set of boundaries in
order to succeed.
Finally, for employees, compensation is an entitlement and reward, and
plays a part in their social and economic well-being. Employees expect
compensation for their work and often see it as a return on their
investments in the training they received.
Ans To The Question No- 3
The factors that influence internal pay structures: There are two types of
factor that can influence pay structures. Internal pay structures is one of
them. Here is some factors-
1. Compensation policies,
2
2. Organizational ability to pay,
3. Job analysis and job descriptions,
4. Employee Related,
5. Trade union’s bargaining power.
I think Compensation policies are most important to influence internal pay
structure. Because It provides general guidelines for making compensation
decisions. The first thing employers should consider when developing
compensation package is fairness. It should be vital and maintain internal
and external equity. The policy should include the company’s philosophy
related to the major components of incentive compensation, including the
strengths and weaknesses of each and how the overall plan provides
optional alignment of interest with shareowners.
The policy should provide broad guidelines by which the company will
use alternative forms of compensation, and the relative weight in relation
to overall compensation if “others” form of compensation will be utilized.
An organization often, formally or informally, establishes compensation
policies that determine whether it will be a pay leader, a pay follower, or
strive for an average position in the labour market.
 Pay leaders– They are organizations that pay higher wages and
salaries than competing firms. This helps to retain and attract high
quality and productive employees.
 The market rate– These are the average pay that most employers
provide for a similar job in a particular area or industry, it is also
known as going rate.
 Pay followers– These are companies that choose to pay below the
market rate because of poor financial condition or a belief that they
simply do not require highly capable employees.
3
The major decisions involved in job analysis:
1. Why perform the job analysis?
By performing a job analysis, human resources personnel can clarify the
role's needs, as well as define employer expectations; essentially
everything you need to write the most accurate job description and
produce the best job advert for your recruitment needs.
2. What information is needed?
Job analysis should collect information on the following areas: Duties and
Tasks The basic unit of a job is the performance of specific tasks and
duties. Information to be collected about these items may include:
frequency, duration, effort, skill, complexity, equipment, standards, etc.
3. How to collect information?
Methods of Data Collection for Job Analysis
 Observation
 Interview
 Questionnaire
 Checklists
 Critical Incidents
 Diaries or Log Records
 Technical Conference Method
4. Who to involve?
The Job Analysis may be conducted by a member of the employer's
Human Resources department. This analysis may be in conjunction with
the job incumbent, the incumbent's supervisor, and possibly subject matter
experts.
5. How useful are the results?
Job analysis is crucial for first, helping individuals develop their careers,
and also for helping organizations develop their employees in order to
maximize talent. The outcomes of job analysis are key influences in
4
designing learning, developing performance interventions, and improving
processes.
Ans To The Question No-5

A job based structure relies on the work content; tasks, behaviors, and
responsibilities while a person based structure shifts the focus to the
employee; the skills, knowledge or competencies the employee possesses,
whether or not they are used in the employee’s particular job. The decision
on which type of pay structure to utilize should be based on which
approach is most appropriate for the organization. The organization’s
strategy (mission, vision, objectives), combined with the product/service
offered, the nature of the competitive environment, and type of technology
used, will be key determinants of which structure to employ. The nature of
the workflow and whether an individual or team-based performance is
required are additional factors to consider. While person-based structures
are currently popular, job-based structures are still the most common as
they are appropriate across the widest variety of organizations and
employee groups. It is becoming more common for an organization to
employ both types of structures for different employee groups (managers,
professionals, technicians, administrative employees) due to the
differences in workflow.

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JAHANGIRNAGAR UNIVERSITY

Course Title: Compensation Management

There are four perspectives of compensation: Society, Stockholder,

Ans To The Question No- 3

Ans To The Question No-5

Ans To The Question No- 6

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