Employee Reward System (Remuneration)

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Employee Reward System (Remuneration)
A reward system consists of financial rewards and
employee benefits. Together these two elements
make up an individuals total remuneration. Pay
causes the most controversy with HRM. Within HRM
there has been a move from collective bargaining
to individual remuneration arrangements. This has
contributed to the decline in the Trade Union
movement. The Design of Reward Systems Managers
and shareholders expect it to prove
cost-effective (i.e. not incurring unnecessary
expenditure) but they must also be attractive
enough to keep good calibre applicants. With the
development of HRM, pay systems are based
increasingly on individuals and local (not
national) pay rates. A good reward system will
encourage the right turnover of employees. Q
What are the problems if turnover is a) too high
and b) too low?? Rewards as part of a complete
approach The reward system must fit in with
leadership style, appraisal and motivation
methods. This may mean good pay rates, but also
the use of non-financial rewards for employees.