Introduction
Salaries and wages
These are the payments made by the economic unit to remunerate the ordinary and extraordinary work of the personnel dependent on the company name, before any deduction withheld by the employers. Includes: bonuses, sales commissions that complement the base salary, vacation bonuses, bonuses, incentives, bonuses, productivity bonuses and salary credit. Excludes: expenses on tickets and per diem, food and in general expenses reimbursable to the worker; payments to personnel that do not depend on the economic unit and that were charged exclusively based on fees, commissions or equals; and the payments that the economic unit made to another company name for the provision of personnel, pensions and payments for dismissal or termination of contract.
Abstract
Wages and salaries
These are payments made economic unit to compensate the ordinary and extraordinary work of staff under the name, before any deductions withheld by employers. Includes bonuses, sales commissions that complement the basic salary, vacation pay, bonuses, incentives, bonuses, productivity bonuses and salary credit. Excludes: travel and per diem expenses, food and generally reimbursable expenses to the worker; payments to staff that does not depend on the economic unit and charged based solely on fees, commissions or retainers; and payments made to the economic unit to another company name on account of staffing, pensions and severance payments or termination.
Development of the topic
Unit I
Administration of wages and salaries
1.1. Wage management concepts
It is the set of norms and procedures tending to establish or maintain fair and equitable salary structures in the organization, in relation to:
- The wages with respect to the same positions of the own organization (internal balance of wages). It is achieved through the evaluation and classification of positions, on a previous program of description and analysis of positions. The salaries with respect to the same positions of other companies that act in the labor market (external balance). It is accomplished by investigating wages.
With this information a salary policy is defined, which is a particular and specific aspect of the general policies of the organization.
The objectives of the salary administration are:
- Remunerate each employee according to the position they occupy Properly compensate them for their performance and dedication Attract and retain the best candidates for the positions, in accordance with the requirements for their adequate coverage Extend the flexibility of the organization by giving it the adequate means for the mobility of personnel, streamlining career and development opportunities Obtaining acceptance of company remuneration systems from employees Maintaining balance between the organization's financial interests and its employee relations policy Facilitating the payroll process
1.2. Goals of wage administration
Administration of wages - What is the correct administration of wages and the objectives to be achieved with the administration of wages.
The administration of workers' wages seeks certain objectives, and achieving them is the main reason for their existence. For this reason, we are going to comment on the main objectives that the administration of wages in the company intends to achieve.
Get qualified personnel. The compensation of the salary must be sufficient to get qualified personnel to enter the company, to compete in the labor market to get the best qualified personnel and that these people prefer to enter the company and not in another, the salary is one of the most important aspects to take into account although not the only one.
Guarantee equality in the company, both internal and external equality. This means that there must be equality of wages between the workers of the company in their positions and also there must be equality with respect to the workers of other companies, so that a worker in the company does not feel that they are paid less than if they did in another developing the same position.
Retain and retain current employees. Employees must be prevented from leaving the company and high turnover rates, and for this, a correct salary policy must be created.
Get a good performance at work. The payment must also be based on the position and the responsibilities assumed by the worker, being that if the salary is insufficient, performance may also decline. A good salary and compensation policy is very important to achieve the best performance in the job.
You must comply with legality, since it is part of a specific legal framework from which you must not depart. For example, the interprofessional minimum wage must be respected at all times, as well as the law and agreements of unions and professions.
Control costs. Proper wage management helps obtain and retain the workforce at the most appropriate cost and best results.
A salary program must be designed that is managed efficiently and meets the objectives of the compensation plan. In addition, the flexibility of the organization must be expanded and the balance between the financial interests of the company and the policy of relations with the workers must be maintained.
As we can see, the correct administration of the salary policy is very important to achieve important aspects in the proper functioning of the company and achieve the best results.
1.3. Classification of wages
The salary is the remuneration that an employee receives from the contracting party in exchange for the provision of a service or activity.
There are several ways to classify wages:
According to the way in which the salary is calculated, we find:
Salary per unit of time: this type of salary is established according to the duration of the service provision. For example, per day, per month, etc.
Salary per unit of work: the salary per unit of work, on the other hand, is paid according to the amount of work that has been carried out. That is, regardless of the time that has been invested in executing it.
Mixed salary: It is one that combines the salary per unit of work with the salary per unit of time.
According to purchasing power, the salary is classified as:
Nominal salary: this type of salary is constituted by the amount of money established in an individual contract, according to the position that is held.
Real salary: the real salary is the one that represents the amount of goods and services that the subject has the possibility of accessing based on the amount of salary received. It refers to purchasing power. An increase in nominal wages does not always mean an increase in real wages.
Taking into account the means of payment:
Cash salary: this corresponds to the one paid in legal tender. In this way, the recipient has the possibility of making cash payments.
Salary in kind: on the contrary, the salary in kind is one that is paid with goods other than money. For example, with shelter, vehicle, etc.
Another classification divides the salary into:
Fixed salary: made up of a series of elements, of which the amount is previously known precisely. For example, the Christmas bonus.
It is so named because it occurs when a certain daily payment is fixed per month, week, fortnight, etc.
Variable salary: the variable salary is established based on a series of elements, of which the amount is not previously known exactly.
Mixed salary: the mixed salary is made up of variable and fixed elements.
1.4. The varied nature of the salary
Compensation is the area related to the remuneration that the individual receives as a return for the execution of organizational tasks.
Basically, it is a relationship of exchange between people and the organization. Each employee transacts with their work for financial and non-financial rewards. The financial reward can be direct or indirect.
Direct financial compensation is the payment each employee receives in the form of wages, bonuses, awards} commissions. Salary represents the most important element. Salary is the remuneration in money or its equivalent that the employer pays the employee for the position that she exercises and for the services that she provides during a certain period. The salary can be direct or indirect. Direct is the one received as a service provision in the occupied position. In the case of employees, who work by the hour, corresponds to the number of effective hours worked per month (excluding paid weekly rest). In the case of workers by months, it corresponds to the monthly salary received.
Indirect financial compensation constitutes indirect salary, resulting from clauses of the collective labor agreement and the social services benefit plan offered by the organization. The indirect salary includes vacations, gratuities, tips, additional (from
insecurity, unhealthy, night work, service time), profit sharing, overtime, as well as the monetary equivalent of the services and social benefits offered by the organization (subsidized food, subsidized transportation, collective life insurance, etc.). The sum of the direct salary and the indirect salary constitutes the remuneration. Therefore, the remuneration covers all the elements of the direct salary and all the elements of the indirect salary. In other words, remuneration constitutes everything the employee receives, directly or indirectly, as a consequence of the work that he carries out in an organization.
Nonfinancial rewards, such as prestige, self-esteem, recognition, and job stability, profoundly affect satisfaction with the compensation system.
The name of compensation is given to the system of incentives and rewards that the organization establishes to remunerate and reward the people who work in it. Thus compensation includes remuneration, in all its possible forms. Compensation is probably the main reason people are looking for a job. From the point of view of each person, it is almost a vital necessity. Payment is the means that allows people to satisfy their needs and those of their families, for many people who have an instrumental attitude towards work, it is the main reason to work. However, work can be more than just an element that satisfies people's physiological needs. Compensation defines the level of Importance of a person to the organization.
There is also a distinction between nominal and real wages. The nominal salary represents the volume of money allocated in the individual contract for the position held. In an inflationary economy, the nominal wage loses purchasing power if it is not updated regularly. The real salary represents the quantity of goods that the employee can acquire with that volume of money, and corresponds to the purchasing power, purchasing power or quantity of merchandise that he can acquire with the salary. Thus, the mere replacement of the real value does not mean a salary increase: the nominal salary is modified to provide the real salary equivalent to the previous period. This is the origin of the distinction between salary readjustment (reconstitution of the real wage) and real wage increase (increase in the real wage).
Due to its complexity, the salary can be considered in many different ways:
- It is the payment of a job. It constitutes a measure of the value of an individual in the organization. It gives hierarchical status in the organization.
The salary constitutes the center of the exchange relations between people and organizations. All people within organizations offer their time and effort, and in return receive money, which represents the exchange of an equivalence between
reciprocal rights and responsibilities between the employee and the employer.
1.5. The salary for people
The salary constitutes the center of the exchange relations between people and organizations. All people within organizations offer their time and effort and in return receive money, which represents the exchange of an equivalence between reciprocal rights and responsibilities between the employee and the employer.
- The salary for people: salaries represent one of the complex transactions, since when a person accepts a position, he commits himself to a daily routine, a pattern of activities and a wide range of interpersonal relationships within an organization, so which receives a salary. Thus, in exchange for this interchangeable symbolic element, MONEY, man is able to pledge much of himself, his effort and his life. The salary for organizations: wages are both a cost and an investment. Cost, because wages are reflected in the cost of the final product or service. Investment, because it represents the application of money in a factor of production. Work as an attempt to achieve a higher return.
The participation of wages in the value of the product depends, obviously, on the branch of activity of the organization. The more automated the production, the lower the share of wages and production costs. In either of these two cases, wages always represent a respectable amount of money for the company that must be very well managed.
- The salary for society: It is the means of subsistence of a large part of the population. The majority of the population always lives on wages.The wage for the country's economic structure: Being the wage, an essential element of the employment contract, and being the employment contract one of the axes of the current economy, conditions the structure society itself.
In order to attract and retain the necessary personnel for the organization, employers should consider that the compensation offered is the most equitable possible, in relation to the knowledge and experiences at the service of the company.
1.6 The salary for organizations
The salary is something of great importance for each of us as workers within an organization, because it is a job that loans to receive something in return, that benefits us and our family members. Salary is the collective remuneration paid for hours worked within any organization; whether it is paid per month or fortnight and it is the effort dedicated to the production of goods and services for which we receive compensation for each worker's payments.
Without benefits, the company loses its ability to grow and develop; As an organization, it must compete with others that carry out identical products or services. A company that does not obtain benefits despite the good will of its workers is not productive, since its collaborators are not satisfied with the reciprocity of their employers, so they have to perfectly manage the organization's resources to achieve that employee satisfaction, trying by all means to achieve an optimal balance between them.
The salary constitutes the center of the exchange relations between people and organizations, all people within organizations offer their time and strength and in return receive money, which represents the exchange of an equivalence between reciprocal rights and responsibilities between the employee and company. Wages represent one of the most complex agreements, since when a person accepts a position, he commits himself to a daily routine, a pattern of activities and a wide range of interpersonal relationships within an organization, for which he receives a salary. Thus, in exchange for this interchangeable symbolic element, money makes man capable of pawning much of himself, his effort and his life.
The salary for organizations are both a cost and an investment, these salaries are reflected in the cost of the final product or service, which in turn represents the application of money in a production factor. The salary at the social level is the means of subsistence of a large part of the population, always the majority of the population lives on the salary. In order to attract and retain the necessary personnel for the organization, employers should consider that the compensation offered is the most equitable possible, in relation to the knowledge and experience at the service of the company.
1.7. The wage compound (internal and external factors)
The wages of workers are conditioned according to a series of factors that determine their values, these factors are called wage compound and among them we can find:
Internal (organizational) factors: these factors come from multiple situations and conditions of the company or organization. Among which we can mention.
- Type of company positions Company salary policy Financial capacity and general company performance Organizational competitiveness
External factors (set them): in this case we are going to refer to all those circumstances that influence but are not determined by the organization, but by government, union and legal policies. Within this area we can find:
- Situation of the labor market Economic situation of the country Trade unions and Collective bargaining Labor legislation Situation of the client market Market competition
1.8. Salary aspects (legal, moral, economic and administrative)
Legally:
The concept of salary is determined by the Statute of workers, which considers wages to be the totality of the economic perceptions of the workers, in money or in kind for the professional provision of labor services for others.
It also determines that they will have a wage determination:
- The amounts received by workers as compensation; Those supplied for expenses incurred as a result of their professional activity; Social Security benefits or compensation; Nor the corresponding compensation for transfers, suspensions, dismissals.
Juridically:
The salary in the economic consideration by the employer of the right of acquisition by him, the result of the provision of services performed by the worker.
Sociologically:
It is the social obligation to remunerate work so that the worker can cover his needs and that of the people who live with him and develop his personality within the scope of his community.
Economically:
The salary is the cost of the labor factor that will be calculated by the employer, since for him it affects the formation of the final price of the product.
For the worker it will be an income with which he will have to face his consumption and personal needs and whose surplus can be used for saving or investment.
With all this we conclude by saying that the salary is the direct economic expression of the work that represents for those who receive it, concrete means to satisfy their needs and for those who pay it, the balance for the products obtained by the work, but also a specific expense of their organization.
The workers' statute establishes that the settlement and payment of wages will be made promptly and documentary (such as the payroll) on the agreed date and place and in accordance with customs and uses.
The official model of the salary receipt must be used, however, its replacement by another model may be used by the Provincial Directorate of Work provided that it brings together with due clarity and separation the various concepts of payment and discount that appear in the official model. All your identification boxes, salary, extra-salary, discounts, etc. must be completed in due form. and it must be signed and sealed by the businessman, thus certifying the authorship of his confession; and signed by the worker as proof of the money he receives, of the concepts that are integrated in it and of the deductions that have been made for its delivery to the corresponding organizations.
1.9. Factors influencing wage determination
The Human Resources professional has to take into account a series of internal and external influencing factors that must be taken into account in the formulation or revision of the established salary policy, and thus be able to decide on the most convenient general salary level for the company.
The main determining factors of wages are the following:
- The labor market: when the supply of labor is scarce in relation to capital, land and other factors of production, employers compete with each other to hire workers, so wages tend to increase. While when the supply of labor is relatively abundant and exceeds the demand, competition among workers to get one of the few available jobs will tend to reduce the average wage. Cost of living: Wage policy must contemplate the purchasing power of wages. The IPC is a benchmark for the implementation or updating of remuneration. Although it must be borne in mind that a significant rise in said index can neutralize any salary improvement achieved by workers.It is impossible to ignore the CPI in salary estimates, since its consideration is a common practice in all collective agreements. Legal restrictions: The company must set the base salary, supplements, the number of extraordinary payments, etc. within the legal framework. of laws and collective agreements always trying to maximize business benefits and staff satisfaction. Productivity: wages tend to increase when productivity increases. This depends largely on energy and the qualification of the workforce, but above all on the available technology. The salary levels of developed countries are to a certain extent high due to the fact that workers have a high level of preparation that allows them to use the latest technological advances. The company's ability to pay:From the point of view of the company, the most important criterion for setting wages is its economic capacity to pay them, although it seems obvious, in these times of crisis, when we have limited credit, it is difficult to apply.
Conclusions
For any administration, compensation is an important part of it, but it must go through a control established by companies based on something very important and fundamental to them: productivity.
Productivity and the relationship with wages have an impact on the way of preparing and developing their work, in addition to having an impact on the standard of living.
Human Resources has various tools to improve the above aspects, and they can be, to manage the human factor correctly, motivate aspirations, and achieve fairness. In other words, HR properly handles tactics and processes that must be followed so that the worker feels comfortable in the economic and psychological aspects, in addition, the payment of wages has to be in balance, this is reflected in the payroll (where deductions are also made), it is worth mentioning that there is control by the law in relation to companies, which maintain the legal framework through the issuance of payments and signatures (and stamps) of the companies where the workers work.
