Web Based Compensation & Planning

WEB BASED COMPENSATION and PLANNING.

Web based compensation can define as an online application that helps the organization to manage, analyze, gather and store all related information regarding to compensation. Meanwhile, web based benefits planning refers to organize the benefits plannning in the organization by human resource information and payroll processing combination information. Normally in health insurance, pension and more. The sysytem can help to improving the organization’s productivity by tying employee productivity with compensation, incentive pay or other benefits. This can help reduce employee turnover in th eorganization. Compensation appear in terms of money, security, stability and hope for bright future, which is consists of salaries or wages, tips, bonuses and commissions. 

         There are two components in the online compensation system, fixed and variable compensation. Fixed compensation is a base pay for employee and the important elements is base payment for work done by the employee. It also includes bonuses such as sign-on bonus, referral bonus, spot bonus reward and retention bonus. Second, merit increases or cost of living adjustments to base wages in wages other employer pay for same work, changes in cost living or changes in knowledge and skills. Third, promotion adjustment depending on KSA require to perform the job and address unusual pay administration issue. Meanwhile, variable compensation consists of individual incentives plan that can be dividing by two type, piece rate plan and standard hour plans. Second, group incentives plan, which is for small group and plant wide incentive plan. Next is profit sharing plan that beneficial for retirement, death and several issues. Lastly, productivity gain sharing program, which is organization sharing with the bottom employee to increase productivity.

There are several advantages of the system for organization and employee such as enable the employer to planning and budgeting employees’ salaries, which is for updating any increasement of employee wages. Second, it can help to improve the organization effectiveness by produce accurate information and simplified the process of paying employees and helped to reduce human error. Third, it provides extension report and presentation for top management because the information already completes in the web and manager can used it to present to the upper level. Next, it helps to streamline the compensation cycles or planning, management can access the compensation information via online web based. Lastly, manager can fairly pay to the top performer employee. However, the disadvantage is requiring a high cost to install and maintenance the system appropriately. 

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REFERENCE:

Ø  Michael J. Kavanagh, Mohan Thite and Richard D. Johnson, Human Resource Information Systems- Basic, Application and Future Directions, Los Angeles, Sage.

Ø  Maimunah Aminuddin, Human Resource Management - Principle and Practices, 2008,  Selangor, Oxford Fajar Sdn Bhd.