Remuneration Last lesson we looked at l Maslow

Remuneration

Last lesson we looked at…. l Maslow and the Hierarchy of Needs l Taylor, Mayo and Herzberg Motivation Theories l Why businesses would want to motivate its employees

Today’s lesson… l Different l How payment systems can you motivate staff through pay?

What is remuneration? A payment system is a method of organising the payment of workers For example paying workers a wage

2 main ways of paying employees… WAGE SALARY Paid weekly or monthly Paid out monthly Based on how many hours have been worked Calculate how much an employee would get a month if he worked Is NOT based on the number of hours worked 40 hours per week @ £ 8. 36 an hour Answer = Get a fixed amount for the year and that is divided into 12 monthly payments If an employee get £ 17, 000 a year. What is their monthly salary? Answer =

But what type of employee gets paid what…? • Manual workers (blue collar workers) tend to do manual/physical work (e. g. stacking shelves, working on tills or cleaning etc). • Manual workers are paid a wage on a time based system. • They are paid a certain amount per hour. If employees work over their agreed basic working week then they can be paid a higher hourly rate known as overtime.

What about other types of workers… Non-manual workers (white collar) tend to be paid a salary. They normally have jobs that are non physical, like an accountant or a teacher. No overtime is paid with a salary even though more hours maybe worked.

A pay slip looks like…

What is on the pay slip?

Other ways of paying employees… Payment Method Piece Rate Commission Bonus Definition Advantage Disadvantage Paid according Encourages Can result in to how much is employees to lower quality produced make more products if rushed Paid a % of the Useful for sales Can result in a value that has staff to sale low basic wage to been sold more encourage staff Addition to the Can help Can be de- basic wage or motivate staff to motivating if it is salary for help the business a target which meeting a target move forward cant be reached

Fringe Benefits… l Non monetary payments made over and above the wage/salary l For example, company car, free health care, insurance, discount cards l The more senior the employee the more fringe benefits they are likely to receive

Which is the best method… What method do you think is the best? What factors do businesses need to take into account when choosing a suitable payment system?

What factors affect which method? l Tradition – Workers dislike changes to their pay, especially if they earn less in the long term l Tax and Employment Costs – Some payments systems cut costs for businesses l Motivation – Some payment systems are used to motivate employees, increasing productivity