SISTEM IMBALAN

(COMPENSATION)

1. Compensation is what employees receive in exchange for their contribution to the organization, it helps the organization achieve its objectives and obtain, maintain, and retain a productive workforce. 2. Compensation refers to all forms of financial returns and tangible services and benefits employees receive as a part of an employment relationship

The objectives of Compensation management are to help the organization achieve strategic success while ensuring internal and external equity. Acquire qualified personnel Retain current employees Reward desired behavior Control costs Comply with legal regulations

Internal equity, ensure that more demanding positions or better qualified people within the organization are paid more. External equity, assure that jobs are fairly compensated in comparison with similar jobs in the labor market

Total Returns

Total Compensation

Relational Returns
Recognition & Status

Cash Compensation
Base Merit/Cost of Living Short-term incentives Long-term incentives

Benefits
Income protection Work/life focus Allowances

Employment security Challenging work Learning opportunities

Major phase of Compensation management

Job analysis
Phase-I Identify & study jobs

Position specifications

Job descriptions

Job standards

Job evaluation (develop a rational approach to pay)

Phase-II Internal equity

Job ranking

Job grading

Factor comparison

Point system

Wage & salary surveys

Phase-III External equity

Dept NAKER

Employer association

Professional associations

Self conducted surveys

Phase-IV Matching internal and external worth

Pricing jobs
Job evaluation worth Match Labor market worth

Rate range for each job

Job Ranking, rank each job subjectively according to its relative

importance (consider individual factors such as the responsibility, skill, effort and working condition) in comparison with other jobs in the firm.

Position
Janitor Secretary Office Manager

Rank
1 2 3

Remark
Less Importance Importance Very Importance

Job Grading, it works by having each job assigned to a grade by

matching standard descriptions with each jobs description.
Job Grade I. Standard Description
Work is simple and highly repetitive, done under close supervision, requiring minimal training and little responsibility or initiative Ex: Janitor, file clerk Work is simple and highly repetitive, done under close supervision, requiring some training or skill. Employee is expected to assume responsibility or exhibit initiative only rarely. Ex: Clerk-typist I, Machine cleaner Work is simple, with little variation, done under general supervision. Training or skill required. Employee has minimum responsibilities and must take some initiative to perform satisfactorily. Ex: Part expediter, machine oiler, Clerk-typist II. Work is moderately complex, with some variation, done under general supervision. High level of skill required. Employee is responsible for equipment or safety; regularly exhibits initiative. Ex: Machine operator I, Tool and die apprentice Work is complex, varied, done under general supervision. Advance skill level required. Employee is responsible for equipment and safety; shows high degree of initiative. Ex: Machine operator II, Tool and die specialist

II.

III.

IV

Factor Comparison, comparing the critical or compensable

factors (common job elements such as responsibility, skill, mental effort, physical effort, and working condition) for each key job (commonly found throughout the organization), and put wages for each job as its compensation.
Compensable or critical factors Machinist Forklift Driver Key Jobs Secretary Janitor File Clerk

Responsibility Skill Mental Effort Physical Effort Working Condition Total Wage Rate ($)

3,20 4,00 3,00 2,00 0,07 12,27 12,27

1,80 1,80 1,20 1,80 0,60 7,20 7,20

2,40 2,00 1,80 0,70 0,60 7,50 7,50

0,80 0,80 0,50 2,70 1,90 6,70 6,70

1,40 1,30 1,40 0,90 0,60 5,60 5,60

Rt ae
40 ,0 39 ,0 38 ,0 37 ,0 36 ,0 35 ,0 34 ,0 33 ,0 32 ,0 31 ,0 30 ,0 29 ,0 28 ,0 27 ,0 26 ,0 25 ,0 24 ,0 23 ,0 22 ,0 21 ,0 20 ,0 19 ,0 18 ,0 17 ,0 16 ,0 15 ,0 14 ,0 13 ,0 12 ,0 11 ,0 10 ,0 09 ,0 08 ,0 07 ,0 06 ,0 05 ,0 04 ,0 03 ,0 02 ,0 01 ,0 00 ,0

Rs o sb i y e p ni i t l

Si l kl
Mc in t a h is

Mna E ot et l f r f

P y i a Ef r h sc l f ot

Wr i g o d i n okn C n i o t

Mc in t a h is Mc in t a h is

S ceay er t r

S ceay er t r S ceay er t r

Mc in t a h is

S ceay er t r S ceay er t r Mc in t a h is

Point System, this system evaluates the compensable factors of each

job, but instead of using wages as the factor comparison does, it uses points.
Compensable or critical factors Minimum
I 1

Level Low
II

Moderate
III

High
IV

Responsibility
aSafety of others bEquipment and materials cAssisting trainees dProduct/ service quality 25 20 5 20 50 40 20 40 75 60 35 60 100 80 50 80

Skill
aExperience bEducation/ training 45 25 90 50 135 75 180 100

Effort
aPhysical bMental 25 35 50 70 75 105 100 150

Working Condition
aUnpleasant condition bHazard 20 20 40 40 60 60 80 80 1000

Total

1.

Responsibility
b. Equipment and materials. Each employee is responsible for conserving the companys equipment and materials. This include reporting malfunctioning equipment or defective materials, keeping equipment and materials cleaned or in proper order, and maintaining, repairing, or modifying equipment and materials according to individual job duties. The company recognizes that the degree of responsibility for equipment and material varies widely throughout the organization. Level I. Level II. Level III. Level IV. Employee reports malfunction equipment or defective materials to immediate superior. Employee maintains the appearance of equipment or order of materials and has responsibility for the security of such equipment or materials. Employee performs preventive maintenance and minor repairs on equipment or correct minor defects in materials. Employee performs major maintenance or overhauls of equipment or is responsible for deciding type, quantity, and quality of materials to be used.

Wage and Salary surveys, suatu aktifitas penelitian yang bertujuan

untuk mendapatkan informasi tentang standar upah dan gaji yang berlaku dipasar tenaga kerja (labor market), dan akan dipergunakan sebagai referensi dalam penetapan besaran upah dan gaji (pay level) oleh satu organisasi/ perusahaan.

Wages or Salaries

Point Values

Problematika kompensasi
1. Strategic Objectives, pola kompensasi dapat dipergunakan untuk
mendorong terciptanya kerjasama tim, apabila besaran kompensasi dikaitkan dengan tingkat kinerja tim (bukan kinerja individu).

2. Prevailing wage rates, kondisi ini terjadi apabila permintaan TK

jauh melebihi penawaran yang tersedia di pasar tenaga kerja, sehingga tingkat upah yang diminta melebihi tingkat normal.

3. Union power, kekuatan menawar (bargaining power) yang dimiliki

Serikat Buruh, dapat berpengaruh pada kesepakatan upah.

4. Government regulations, ketentuan-ketentuan pemerintah yang

mengatur hubungan industrial, terkadang menimbulkan ketidak samaan pemahaman antara buruh dan majikan.

5. Productivity and costs, kondisi ideal adalah bila buruh dibayar

sesuai dengan produktifitasnya.

Nontraditional Compensation

Kompensasi tambahan yang diberikan kepada karyawan/ unit kerja, apabila kinerja seorang karyawan tersebut melebihi tingkat yang telah ditentukan (Insentive), dan atau apabila unit kerja Insentive dapat melakukan penghematan biaya/ peningkatan laba (gainbiaya sharing). sharing

Three Primary Reasons for Adopting Pay Incentive Plans

1. Increase employee motivation. 2. Minimize costs per unit produced. 3. Attract and retain a high performing workforce.

PROS

Individual motivation. Employee perception of equity high performance linked to high reward.
CONS

Inflexible behavior: focus only on rewards. Undesireable outcomes: low quality, equipment damage, poor customer service, etc. Low cooperation. Perceived inequity & low distributive and procedural justice.

Group/Team
Equal rewards for all group members. Differential rewards based on individual merit. Differential rewards between groups based on performance goals.

PROS Individual motivation. Employee cooperation. Broader employee focus: totality of outcomes. Employee perception of equity tied to reward of whole group. CONS Difficulty in designating operating groups. Perception of individual inequity tied to free rider effect.