Compensation

management in NALCO
Compensation Managementis an organized
practice that involves balancing the workemployee relation by providing monetary and
non-monetary benefits to employees.
Compensation is the total amount of the
monetary and non-monetary pay provided to an
employee by an employer in return for work
performed as required.

Types of Compensation
Direct Compensation: Base salary, premium

payment, overtime, merit pay etc

Indirect Compensation: social securities, pension
plan, health, dental, life ,accidental death
insurance.etc
Intangible compensation : thank you, lunch
celebration.

Component of compensation and benefits

Guaranteed pay: Base salary
Variable pay: Bonus and incentives
Benefits: Company car , medical insurance
Equity: Stock

Objectives of compensation management

Better decision-making
Balance your compensation budget
Drive high performance
Find and keep the best
Be fair and transparent

Scope of the study

Opportunity to understand the compensation structure.
It has also helped me in understanding the major

components which are included and affect this

structure
Compensation acts as a major parameter in retention
of workforce and therefore it is very important to
measure employee satisfaction on that. Unless and
until employees are satisfied they
cannotperformefficiently
Opportunity to measure employee satisfaction in
NALCO and to suggest improvements in the
Compensation Management & Reward System of
NALCO

Need of Compensation Management

A good compensation package is important to motivate the

employees to increase the organizational productivity

compensation helps in running an organization effectively and
accomplishing its goals.
Salary is just a part of the compensation system, the employees
have other psychological and self-actualization needs to fulfil.
The most competitive compensation will help the organization
to attract and sustain the best talent.
It stimulates the employees to perform better and show their
excellence.
It provides growth and advancement opportunities to the
deserving employees.
Compensation packages in Indian industry
Employee salary :Basic pay + Grade pay + Dearness Allowance
(DA) + House Rent Allowance (HRA) + City Compensatory
Allowance (CCA)

Research Methodology
The term Research Methodology indicated an exhaustive and
searching investigating into some accepted principles and
conclusions. The first step of any research is to identify the
problem and look at it objectives.
Following steps to be finalized as follows:
The sample is to be surveyed as to get the reliable result
Methods to be used for collecting required information
Interpretation of data to get the required result through an analysis
Provide the necessary recommendation and suggestions

Sources of data collection:

Primary

Data:
questionnaire

Secondary

Primary data have been collected through

Data: Secondary data have been collected from

companys report, research materials, websites, Google.

Finding
It is found that the company has provided all the facilities
and benefits to their employees like :
Salary: 78.6% are strongly agree and agree with this
statement
Increment : 85.7% are highly satisfied and satisfied
Bonus , loan facility, leave facility, medical facility, club
and guest house facility, gratuity, post retirement
medical facilities : more than 90% of employees are
satisfied
Opinion of employees: 85.7% having good opinion
regarding NALCO.
Personal care : 56% are agree
Pension : 57.1% are agree and 42.9% cant say

highly agree and agree

salary
increment
bonus/ex-gratia
gratuity

equal payment for

equal work
compensation magt.
System
loan facility

Interpretation
Overall , NALCO gives a fair wage to its employees

because nearly 79% of employees are satisfied with the

salary given by the company and around 75% of
employees satisfied with the overall compensation
management system of the company and more than
90% of employees are satisfied with the benefits and
facilities provided by the company.
Around 71.4% of employees are satisfied with statement
of equal payment for equal work. It shows the fair wage
system of compensation management.
Therefore the main objective of my study is how the
company is creating a compensation management
strategy that links performance to reward, engaging and
motivating staff at all levels.

Conclusion
Compensation must motivate the employees to contribute their

best and it must be fixed as per their needs and aspirations and
should be based on their merit. There is need for innovative tools
and techniques and strategies in compensation management that
customize the individual needs of the employees for ensuring better
productivity and performance at the workplace.
To conclude, the need to regularly carry out detailed compensation
reviews both within and without, and with full support &
commitment from the top is essential. The specific needs of the
organization must be identified and addressed during such reviews.
Openness and transparency are important to the managers in the
very sensitive and personal issue of management remuneration.The
remuneration & the rewarding systems have to be, and seen to be,
fair and just, non bureaucratic & dynamic, and which are dealt with
human feelings and necessary speed, and still remain competitively
attractive - quite a management challenge in today's tough &
highly aggressive scenario!

Recommendation
As the data shows that Nalco is very good organization and

employees of Nalco including executives and non-executives, all are

satisfied with the benefits, schemes and facilities provided by the
company. Therefore the compensation given by the company is
highly satisfied by the employees working in company but still few
employees are not satisfied with the compensation management of
the company and they are not happy with it.
So the company should required to come up with this problem
because if the employees are not happy, how can they meet the
goals and objectives of company, increases extraction efficiency and
productivity to maximise production and development of new
aluminium alloys and value added products.
So the company should require to going regular feedback of
employees and according to the feedback, the company should
change the policies and facilities which satisfy the whole
organisation and employees.

Bibliography
NALCO WEBSITE (www.nalcoindia.com)
WIKIPEDIA
GOOGLE IMAGES
GOOGLE.COM
HUMAN RESOURCE MANGEMENT BY V.S.RAO (TEXT

BOOK)

Thank you