ROLL NO.

321443

INTRODUCTION
This assignment is based on the study of the remuneration that managers gets for working in a
company. In this assignment we are going to see the structure and the distribution of managers
remuneration under various components. But before that let us understand, what is
Remuneration?
Remuneration is the compensation that an employee of a company receives from the company in
return of the work and services offered. It consists monetary and non-monetary benefits to the
employees like salary, Incentives, fringe benefits, prerequisites, allowances, perks etc.
Remuneration is also one of the ways which an organization opts to reward its workers and
employees.
A well-developed compensation plan can act as a strong statement internally for employees and
and represent a strong image of the company externally. A good remuneration can not only help
the company to retain employees but also helps in attracting employees from competent
organizations.

OBJECTIVES OF COMPENSATION

Attract qualified, interested and experienced employees.

Cost effectiveness.
Facilitate expatriates movement
Motivate employees to perform better.
Helps to design, administer and communicate companys strategies & policies.

Here is an example of structure of remuneration package for manager of ICICI

The above is the pay slip of a manager of ICICI bank. It shows the various components of
Remuneration that the company considers and gives to its employees.
1. The Remuneration structure of ICICI includes monetary as well non-monetary
components1. Basic : It is the basic components that employees are entitled to. It is regarded as the
fixed element of pay regardless of companys performance. It is also used to calculate the
other benefits as a percentage of it.
2. HRA : Referred to as House Rent allowance. It is entitled to the managers on the basis of
the city or location i.e. the category in which it is located. E.g. metropolises have higher
HRA as compared to tier II, tier III cities and towns.
3. Variable Pay/Bonuses : This component of the pay is given on the basis of the
performance of an individual, team or group. The manager achieving the highest rating
possible receives a high component of variable pay.
4. Conveyance : It is the amount that the company pays to its managers for conveyance.
This amount is proportional to the managers position in hierarchy and his role in the
organization.
5. Medical Reimbursement : Health becoming an important aspect for people, companies
have started including medical insurance as a part of their compensation. It is a fixed
component, higher the position of the employee in the organization more is this amount.
6. EPF/VPF Contribution : Stands for Employee Provident Fund. As mandated by the
government a part of employees salary i.e. part of basic salary is cut, same amount is
matched by the organization and kept in social security. VPF is Voluntary Provident Fund
in which an employee voluntarily gives away his part of salary. The organization does not
matches the same amount as EPF but a part of it.
7. Miscellaneous : It consists of any deductions/payouts that the employee has to pay or
receive. It generally includes allowances for lunches and other perks.
8. Taxes & Deductions : It is a component of the employee salary which it has to pay to the
government as taxes, whereas deductions are any arrears that the employee owes to the
company over the previous months / period.

2. The organizations gives out various incentives and benefits to its employees and managers to
motivate them. It is essential to keep the workforce motivated to keep going to make them
consistently perform and get results for the company.

As we have seen above, Variable pay gives a boost to managers morale to perform better

and get the max of what they can in form of variable pay.
Other Monetary benefits and allowances such as travel allowance, lunch allowance and

other perks.
Companies could sponsor foreign trip for employees who excel in their work and

performance.
It is important for an organization to provide comfortable work environment and also

should actualize the level of Maslow hierarchy of employee needs.

Non-monetary benefits and incentives also plays an important role as a part of
remuneration such as
Flexible working time.
Work from home sometimes.
Provide extensive training plans
Offer recognition to staff who excel in their performance.
Rewards based on personal interests like club memberships etc.
For companies having offices and sites at various locations, could shift their
employees from one site to other to give them a break.