c & b glossary

8/14/2019 C & B Glossary

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Glossary ofCompensation & Benefits


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A----------........................................................................................................................................................ 7

ALLOWANCE ................................................................................................................................ 7 Dearness Allowance.................................................................................................................... 7 HRA (House Rent Allowance):.................................................................................................... 7 City compensatory allowance: .................................................................................................... 7 Compensatory Allowance............................................................................................................ 8

Foreign Allowance ...................................................................................................................... 8 Medical Allowance...................................................................................................................... 8 Project Allowance ....................................................................................................................... 8 Transport Allowance ................................................................................................................... 8 Relocation / moving Allowance .......... ........... ........... ........... ........... .......... ........... ........... ........... .. 9 Conveyance allowance................................................................................................................ 9 Uniform ALLOWANCE: (Covered under Section C).............................................................. 9 Children Education allowance......... ........... ........... .......... ........... ........... .......... ........... ........... ..... 9 Children hostel allowance........................................................................................................... 9 Educational Allowance................................................................................................................ 9 Entertainment Allowance ............................................................................................................ 9 Special Allowance ..................................................................................................................... 10 Training Allowance................................................................................................................... 11

ACROSS-THE-BOARDINCREASE............................................................................................ 11 ANNUITY ..................................................................................................................................... 11 ATRISKPAY................................................................................................................................ 12 ATTENDANCEBONUS............................................................................................................... 12

B-----------..................................................................................................................................................... 12

BASEPAYRATE/BASERATE/BASEWAGERATE ............................................................... 12 BACKPAY.................................................................................................................................... 12 BENCHMARKJOB ...................................................................................................................... 13 BROADBANDING ....................................................................................................................... 13 BENEFITS..................................................................................................................................... 13 BFOQ............................................................................................................................................. 13 BONUS(PRODUCTIONANDNONPRODUCTION)................................................................. 14

Production Bonus...................................................................................................................... 14 Nonproduction Bonus................................................................................................................ 14

BENEFICIARY ............................................................................................................................. 14 BLUECIRCLERATE(GREENCIRCLERATE) ........................................................................ 14

C------------ ................................................................................................................................................... 14

CLASSIFICATION ....................................................................................................................... 14 COMPENSATION ........................................................................................................................ 15 COMPENSATIONPHILOSOPHY............................................................................................... 15 COMPA-RATIO............................................................................................................................ 15 COMPENSABLEFACTORS........................................................................................................ 15 COMPRESSION(PAY/SALARYCOMPRESSION)................................................................... 16

CONTROLPOINT ........................................................................................................................ 16 CALL-INPAY(CALLBACKPAY) ............................................................................................. 16 CHILDCAREBENEFIT............................................................................................................... 16 CLOTHINGALLOWANCE(UNIFORMALLOWANCE).......................................................... 16 COMMISSIONEARNINGS ......................................................................................................... 17 COMPRESSEDWORKWEEK ..................................................................................................... 17 CONTINGENTCOMPENSATION.............................................................................................. 17 CONTRACTSIGNINGBONUS................................................................................................... 17 CONTRIBUTORYPLAN ............................................................................................................. 17


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CONSUMER PRICE INDEX ................................................................................................................ 18

D----------...................................................................................................................................................... 18

DOWNGRADING: ............................................................................................................................. 18 DEFERREDEARNINGS .............................................................................................................. 18 DEFERREDWAGECHANGE..................................................................................................... 18

DIFFERENTIALPIECERATES .................................................................................................. 18 DOUBLETIME............................................................................................................................. 19 DRAWACCOUNT ....................................................................................................................... 19

E----------...................................................................................................................................................... 19

EQUITY ........................................................................................................................................... 19 EXCHANGE RATE ............................................................................................................................ 19 EXTRINSIC REWARDS ...................................................................................................................... 19 EARNINGS(HOURLY;DAILY;WEEKLY;ANNUALCOMPENSATION)............................ 20 EDUCATIONLEAVE................................................................................................................... 20 EDUCATIONALASSISTANCE(TUITIONAID;TUITIONPAYMENTPLAN)....................... 20 EDUCATIONALPAYDIFFERENTIAL...................................................................................... 20 ELDERCARE ............................................................................................................................... 20 EMPLOYEEBENEFITPLAN...................................................................................................... 20 ENTRANCE/HIRING RATE.......................................................................................................... 21 EX-GRATIA PAYMENT..................................................................................................................... 21 EXTERNAL EQUITY ......................................................................................................................... 21

F----------...................................................................................................................................................... 21

FIXED PAY....................................................................................................................................... 21 FACTOR COMPARISON METHOD....................................................................................................... 22 FIXED INCREASE AMOUNT .............................................................................................................. 22 FLEXIBLEBENEFITPLAN(CAFETERIAPLAN).................................................................... 22 FLEXIBLEWORKSCHEDULEPLAN(FLEXITIME)............................................................... 22 FRINGE BENEFIT ............................................................................................................................. 22

FRINGE BENEFIT TAX ..................................................................................................................... 23 FLOATINGHOLIDAY................................................................................................................. 23 FUNERALLEAVE(BEREAVEMENTLEAVE)......................................................................... 23

G---------- ..................................................................................................................................................... 23

GAIN SHARING ................................................................................................................................ 23 GROUPHEALTHPLAN .............................................................................................................. 24 GROUPINCENTIVEPLAN......................................................................................................... 24 GEOGRAPHIC DIFFERENTIALS.......................................................................................................... 24

H---------- ..................................................................................................................................................... 24

HAZARDPAY .............................................................................................................................. 24

I----------....................................................................................................................................................... 24

IN-RANGE ADJUSTMENT .................................................................................................................. 24 INTERNAL EQUITY........................................................................................................................... 25 INCENTIVE (PAY PLANS).................................................................................................................. 25 INDIRECT PAY ................................................................................................................................. 25 INTRINSIC REWARDS ....................................................................................................................... 25 INSURANCE................................................................................................................................. 25 INSURANCECARRIER............................................................................................................... 26 INSURANCEPOLICY.................................................................................................................. 26


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J----------....................................................................................................................................................... 26

JOB.................................................................................................................................................. 26 JOB ANALYSIS ................................................................................................................................ 26 JOB DESCRIPTION............................................................................................................................ 26 JOB EVALUATION............................................................................................................................ 27 JOB FAMILY .................................................................................................................................... 27 JOB GRADE ..................................................................................................................................... 27 JOB SPECIFICATIONS ....................................................................................................................... 27 JOB WORTH HIERARCHY ................................................................................................................ 28

K---------- ..................................................................................................................................................... 28

KNOWLEDGE-BASED PAY................................................................................................................ 28 KSA(KNOWLEDGE, SKILLS, AND ABILITIES) .................................................................................. 28

L----------...................................................................................................................................................... 28

LABOR DEMAND ............................................................................................................................. 28 LIVINGWAGE............................................................................................................................. 29 LONGEVITYPAY........................................................................................................................ 29

LUMP-SUMPAYMENTS ............................................................................................................ 29 LABOR MARKET ............................................................................................................................. 29 LEAD OR LAG POLICY ..................................................................................................................... 29 LEAVE TRAVEL ASSISTANCE .......................................................................................................... 29 LOWER QUARTILE OR 25TH PERCENTILE ........................................................................................ 30

M----------..................................................................................................................................................... 30

MERITINCREASE....................................................................................................................... 30 MERIT PAY ..................................................................................................................................... 30 MERIT INCREASE ............................................................................................................................ 30 MERIT RATING................................................................................................................................ 30 MIDPOINT ....................................................................................................................................... 31 MINIMUMWAGE........................................................................................................................ 31 MAXIMUM RATE ............................................................................................................................. 31 MARKET ADJUSTMENT .................................................................................................................... 31 MEDIAN .......................................................................................................................................... 31

N----------...................................................................................................................................................... 31

NONCONTRIBUTORYPLAN..................................................................................................... 31 NONWAGECASHPAYMENTS ................................................................................................. 32

O---------- ..................................................................................................................................................... 32

OCCUPATION .................................................................................................................................. 32 OCCUPATIONALRATES ........................................................................................................... 32 ONCALLPAY.............................................................................................................................. 32 OUTOFWORKBENEFITS ......................................................................................................... 32 OVERTIME................................................................................................................................... 32

P----------...................................................................................................................................................... 33

PAY................................................................................................................................................. 33 PAIRED COMPARISON ...................................................................................................................... 33 PROFIT SHARING ............................................................................................................................. 33 PAY ADJUSTMENT........................................................................................................................... 33 PAY PLAN ....................................................................................................................................... 34


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PAY POLICY .................................................................................................................................... 34 PAY GRADE/RANGE ........................................................................................................................ 34 PAY RANGE WIDTH ........................................................................................................................ 34 PAY STEPS ...................................................................................................................................... 34 PERSON-BASED PAY........................................................................................................................ 34 PAY LEVEL STATISTICS................................................................................................................... 35

PERQUISITE/PERKS ......................................................................................................................... 35 PAY PERIOD .................................................................................................................................... 35 PAY SCALE ..................................................................................................................................... 36 PAY ROLL........................................................................................................................................ 36 PAIDLUNCH(MEALTIME) ....................................................................................................... 36 PAIDVACATIONS....................................................................................................................... 36 PAYROLLDEDUCTIONS........................................................................................................... 37 PAYROLLPERIOD ...................................................................................................................... 37 PIECEWORK ................................................................................................................................ 37 PIECERATE ................................................................................................................................. 37 PREMIUMPAY ............................................................................................................................ 37 PREVAILINGRATE(GOINGRATE) ......................................................................................... 37 PROBATIONARYRATE ............................................................................................................. 38 PUSHMONEY.............................................................................................................................. 38

R----------...................................................................................................................................................... 38

REMUNERATION.............................................................................................................................. 38 REIMBURSEMENT ............................................................................................................................ 38 RECOGNITION: ................................................................................................................................ 39 REWARDS ....................................................................................................................................... 39 RANGE PENETRATION ..................................................................................................................... 39 RATERANGE............................................................................................................................... 39 RATESETTING............................................................................................................................ 39 RATE ARRANGED ............................................................................................................................ 40 RECLASSIFICATION ......................................................................................................................... 40

REWARD SYSTEM ........................................................................................................................... 40 REALWAGES .............................................................................................................................. 40 REDCIRCLERATE(OUTOFLINERATE;FLAGGEDRATE)................................................ 40 REFERRALBONUS..................................................................................................................... 40 RELOCATIONALLOWANCE(MOVINGALLOWANCE)....................................................... 40 ROLLUP ....................................................................................................................................... 41

S---------- ...................................................................................................................................................... 41

SALARY .......................................................................................................................................... 41 SALARY STRUCTURE....................................................................................................................... 41 SALARY RANGE WIDTH .................................................................................................................. 41 SALARY SURVEY ............................................................................................................................ 42 SKILL-BASED PAY........................................................................................................................... 42 SAFETYBONUS .......................................................................................................................... 42 SEVERANCEPAY(DISMISSALPAYORALLOWANCE;TERMINATIONPAY;SEPARATIONPAY;LAYOFFALLOWANCE) ................................................................................... 42 SHIFTDIFFERENTIAL(SHIFTPREMIUM).............................................................................. 42 SIGNINGBONUS......................................................................................................................... 43 STANDARDRATE....................................................................................................................... 43 STEPRATES................................................................................................................................. 43 SINGLE-RATE SYSTEM .................................................................................................................... 43 STOCKOPTIONPLAN................................................................................................................ 43


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STOCKPURCHASEPLAN.......................................................................................................... 44 SUBSIDIZEDCOMMUTING....................................................................................................... 44 SUPPLEMENTALPAY................................................................................................................ 44 STATISTICAL TERMS........................................................................................................................ 44

T----------...................................................................................................................................................... 45

TIERED PAY PLAN........................................................................................................................... 45 TAKEHOMEPAY........................................................................................................................ 45 TELECOMMUTING..................................................................................................................... 45 TEMPORARYRATES.................................................................................................................. 45 TONNAGERATE ......................................................................................................................... 46 TOOLALLOWANCE................................................................................................................... 46 TOTAL CASH COMPENSATION......................................................................................................... 46 TOTAL REMUNERATION .................................................................................................................. 46

U----------...................................................................................................................................................... 46

UNIONDUES................................................................................................................................ 46 UNIONRATE(SCALE)................................................................................................................ 47 UPGRADING ................................................................................................................................ 47 UPPER QUARTILE OR 75THPERCENTILE LEVEL ............................................................................... 47

V----------...................................................................................................................................................... 47

VARIABLE PAY ............................................................................................................................... 47

W----------..................................................................................................................................................... 48

WAGERATE ................................................................................................................................ 48 WAGEDETERMINATION.......................................................................................................... 48 WAGEDIFFERENTIALS............................................................................................................. 48 WAGEFREEZE ............................................................................................................................ 48 WAGEPROGRESSION................................................................................................................ 48 WAGE SURVEY ............................................................................................................................... 49

WAITINGPERIOD....................................................................................................................... 49 WELLNESSBENEFITS ............................................................................................................... 49 WORKING TITLE ............................................................................................................................. 49 WAGE GARNISHMENT ..................................................................................................................... 49 WEIGHTED AVERAGE ..................................................................................................................... 49


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A----------

ALLOWANCEAllowances are fixed sums of money paid, allowed or granted regularly during a given

period in addition to the salary for the purpose of meeting some particular

requirement.

Different types of allowances are as under:

Dearness AllowanceIt is a payment towards the rise in cost of living, which is calculated based on cost of

living index Dearness allowance (D.A.) is part of a person's salary. D.A. is calculated as

a percent of the basic salary. This amount is then added to the basic salary. Rates vary

as per rural/urban areas. It is usually amounts to 40% of the basic salary.

HRA (House Rent Al lowance):House Rent Allowance is an allowance given by an employer to an employee for the

sole purpose of meeting the cost of renting a home. An employee having HRA as a part

of the salary package, staying in a rented accommodation by paying rent for it and if

the rent exceeds 10% of the salary is entitled for HRA Allowance. The actual amount

paid as HRA is 40% of the total salary and it is 50% of the total salary if the house is

rented out in Delhi, Mumbai, Chennai or Kolkata.

Ci t y compensat ory al lowance:City Compensatory Allowance is paid to compensate or enable to bear the high cost ofliving prevailing in an urban area or a city. (The limit is upto Rs. 850 per month

depending upon the city.


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Compensat ory Al lowanceIt is an allowance to meet personal expenditure necessitated by the special

circumstances in which the duty is performed. This is similar to Risk Allowance

sanctioned by Government. The specifiable difference between the two is that RiskAllowance is mainly connected with factors that affect health, but Compensatory

Allowancecan be a compensation for any extra effort while discharging official duties

(like extra office hours, carrying valuable things etc).

Foreign AllowanceIt is allowance paid by the government to the Indian citizen for rendering services

outside India.

Medical All owanceIf any sum is paid by the employer for expenditure actually incurred by the employee

for medical treatment in an approved/unapproved hospital upto the limit of Rs. 15,000

per annum then its classified as Medical Allowance. If the actual bill exceeds Rs.

15,000 then the extra portion is taxable at the hands of employee.

Proj ect Allowance

Project Allowance is classified as compensatory allowance paid to the staff engaged in

the execution of projects or other specified work located within the area specially

demarcated for project purposes.

The very basis of providing a Project Allowance is to motivate an employee to take up

an assignment in a project area which is generally inhospitable and not having the

usual comforts or facilities of a town. Further the nature of work could be arduous.

Transport All owanceIt means allowance to meet expenses incurred for office to home and home to office.

It is exempted up to 800 per month maximum.

Tiffin Allowance


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Relocat ion / moving All owanceAllowance to meet the cost of travel on tour or on transfer (including amount paid for

packing and transportation of personal effects on such transfer): exempted to the

extent allowances used for said purpose.

Conveyance allowanceIt is the allowance to meet the expenditure on conveyance in performance of duties of

an official nature. It is exempted to extent allowance used for said purpose.

Unif orm ALLOWANCE: (Covered under Sect ion C )

Chil dren Educat ion allowanceUnder this scheme Rs 100 per month per child up to maximum of two children are

given as Children Education Allowance and is exempted if the expenses are made in

India. For the children of Government employees school education allowance and

reimbursement of tuition fees has been merged together into scheme known as

Children Education Allowance and under this scheme an annual amount of Rs.12,000 is

payable, which can be availed quarterly @ Rs. 3000 for children from nursery to 12 th

Std.

Children hostel allowance300 per month per child up to maximum of two children is given under this scheme

and is exempted if the expenses are made in India.

Educat ional AllowanceIt is granted for encouraging the academic, research and other professional pursuits

and is exempted to the extent used for the said purpose.

Entert ainment All owanceIt is the amount paid by employer for availing entertainment services


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The amount of deduction available is restricted to least of the following:

# In case of government employees: Rs. 5,000; 20% of salary; or amount of

entertainment allowance granted during the previous year.

# In case of non-Government employees: Rs. 7,500; 20% of salary; amount ofentertainment allowance granted during the previous year.

Special AllowanceThis includes allowances which are position and area specific, dependent on the

nature of job. These allowances are as follows:

Any Special compensatory Allowance in the nature of hilly area allowance, HighAltitude Allowance, Uncongenial Climate Allowance or Snow Bound AreaAllowance or Avalanche Allowance

Any Special Compensatory Allowance in the nature of Border Area Allowance,Remote Locality Allowance or Difficult Area Allowance or Disturbed Area

Special Compensatory (Tribal Areas/ Schedule Areas/ Agency Areas) Allowance Any allowance granted to an employee working in any transport system to meet

his personal expenditure during his duty performed in the course of running ofsuch transport from one place to another place, provided that such employees

is not in receipt of daily Allowance

Children Education Allowance Any Allowance granted to an employee to meet the Hostel expenditure on his

Child

Underground Allowance granted to an employee who is working in uncongenial,unnatural climate in underground coal mines

Any special allowance granted to the members of the armed forces in thenature of special compensatory highly active field area allowance


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Any special allowance granted to the member of the armed forces in the natureof Island (duty) allowance

Allowances to Govt. Employee outside India Allowance to High Court and Supreme Court Judge Foreign Allowance Transfer Allowance Allowance Received from a United Nation Organization Helper allowance (Expenditure on a helper where such helper is engaged for

the performance of the duties of office)

Academic allowance

Training AllowanceIt is allowance given to employees for attending a specific training session/seminar or

taking up certain educational/academic/research course. Usually, part of the

allowance is paid before the start of course for admission; the rest is made when the

person achieves a qualification/completes the course and remains in the service for a

particular period of time.

ACROSS-THE-BOARD INCREASEIt is a wage or salary increase where either a flat rate (common number of

Rupees/hour) or a common percentage of salary is used. It is also called a General

Increase.

ANNUITYAnnuity is a form of distribution from a retirement plan providing periodic payments.

Straight-life annuities provide payments, usually monthly, for the lifetime of a retiree.


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Joint-and-survivor annuities provide payments to a retiree, and upon the retirees

death, payments to a surviving spouse.

AT RISK PAYPay that an employee is not guaranteed to receive but may receive under certain

circumstances. Examples include commissions, piece rates, and various kinds of

bonuses such as safety or attendance awards.

ATTENDANCE BONUSPayment or other type of reward (e.g., a day off) for employees whose work

attendance record meets certain standards.

B-----------

BASE PAY RATE/BASE RATE/ BASE WAGE RATEThe fixed compensation paid to an employee for performing specific job

responsibilities; which is exclusive of additional payments or allowances. It is the

Wage rate for work performed during a unit of time, most commonly expressed as a

rate per hour. It may, however, be expressed as an amount per day, week, month, or

year. It does not include overtime or incentive rates.

BACK PAYPayment of part or all of an employees wages for a particular prior period of time,

arising from arbitration, court, or board awards, grievance settlements, errors in

computation of pay, misinterpretation of wage legislation, etc.


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BENCHMARK JOBA job that is commonly found and defined, used to make pay comparisons, either

within the organization or to comparable jobs outside the organization to develop or

validate a job-worth hierarchy. Pay data for these jobs are readily available inpublished surveys.

BROADBANDINGPay structure that consolidates a large number of pay grades and salary ranges into

much fewer broad bands with relatively wide salary ranges. These ranges typically

have 100 percent or more differences between minimum and maximum (e.g. $25,000

to $50,000).

NOTE: These are similar to pay grades but are usually much wider and encompass

more jobs. The philosophy behind utilizing a pay band vs. a pay grade pay structure

usually is one that provides managers with more flexibility for rewarding employees

for taking on additional tasks or for working at a higher level. Some organizations will

also adopt this kind of structure to help emphasize a policy of promotion within.

BENEFITSNon wage compensation provided to employees. The National Compensation Survey

groups benefits into five categories: Paid leave (vacations, holidays, sick leave);

supplementary pay (premium pay for overtime and work on holidays and weekends,

shift differentials, non production bonuses); retirement (defined benefit and defined

contribution plans); insurance (life insurance, health benefits, short-term disability,

and long-term disability insurance) and legally required benefits (Social Security and

Medicare, Federal and State unemployment insurance taxes, and workers

compensation).

BFOQBona Fide Occupational Qualifications It is legally defensible minimum qualifications

to perform the job.


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BONUS (PRODUCTION AND NONPRODUCTION)

Product ion Bonus

Extra payment based on production in excess of a quota or on completion of a job inless than standard time.

Nonproduct ion BonusA cash payment that is not directly related to the output of either the employee or a

group of employees is termed as non production bonus. Examples include attendance,

Diwali, profit sharing, safety, and year-end bonuses.

BENEFICIARYThe person designated by an employee or retiree to receive benefit payments in the

event of the employees or retirees death.

BLUE CIRCLE RATE (GREEN CIRCLE RATE)Pay rate of a non-probationary worker that falls below the established rate ranges for

workers performing the same duties

C------------

CLASSIFICATIONSystematic arrangement in groups or categories according to established criteria

Hierarchical structure of jobs arranged into classes or pay grades. Predefined class

descriptions are established for each job and jobs are placed in whichever

classification best describes them.


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COMPENSATIONA methodical approach to assigning a monetary value to employees in return for work

performed. Compensation may include any or all of the following: base pay, overtime

pay, commissions, stock option plans, merit pay, profit sharing, bonuses, housingallowance, vacations and all benefits. This is referred to as remuneration in some

foreign countries.

COMPENSATION PHILOSOPHYA set of guiding principles that are based on values that drive compensation decision-

making.

COMPA-RATIOThe ratio of an actual pay rate (numerator) to the midpoint or some other control

point for the respective pay range (denominator) is known as Compa-ratio. Compa-

ratios are used primarily to compare an individual's rate of pay to the mid-point or

control point of the range. A compa-ratio may be calculated for an individual, a group

of people, a department, or an entire organization.

Compa Ratio = Individual Salary * 100

------------------------------

Salary Median

COMPENSABLE FACTORSElements of a job for which the organization is willing to pay constitute the

compensable factors. These are used to provide a basis for judging job value to create

a job worth hierarchy (job evaluation). Factors are usually measured in degrees and

are weighted, based on their pre-determined value to the organization. Typical

factors include skills, effort, responsibility, scope of authority, and working

conditions.


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COMPRESSION (PAY/SALARY COMPRESSION)Pay compression is the situation that occurs when there is only a small difference in

pay between employees regardless of their skills or experience. It is also referred to as

salary compression. Pay compression is the result of the market-rate for a given joboutpacing the increases historically given by the organization to high tenure

employees. Therefore, newcomers can only be recruited by offering them as much or

more than senior professionals. A prime example is new hire pay rates higher than

those of current incumbents and subordinates paid higher than supervisors due to

overtime.

CONTROL POINTThe point within a salary range representing the desired pay for a fully qualified,

satisfactory (average) performer in a job or group of jobs at a given time (usually the

midpoint of a salary range).

CALL-IN PAY (CALLBACK PAY)Pay guaranteed to a worker recalled to work after completing the regular work shift.

Call-in pay is a synonym for reporting pay

CHILD CARE BENEFITEmployers full or partial payment for the cost of caring for an employees children in

a nursery, day care center, or by a baby-sitter, on or off the employers premises,

while the employee is at work

CLOTHING ALLOWANCE (UNIFORM ALLOWANCE)It is the monetary allowance for clothing or its upkeep or both, granted by an

employer to employees who are required to wear special clothing, such as uniforms or

safety garments, in the performance of their work.


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COMMISSION EARNINGSCompensation to salespeople based on a predetermined formula, for example, a

percentage of the value of sales or the gross margin of goods or services sold. May be

in addition to a guaranteed salary rate or may constitute total pay.

COMPRESSED WORKWEEKIt refers to completing standard weekly hours (e.g., 36, 37 1/2, 40 hours) in fewer

days than the traditional 5-day workweek by increasing daily hours worked. Usually,

the 40-hour workweek is scheduled over 4 days of 10 hours.

CONTINGENT COMPENSATIONIt is the linking of a portion of employees pay or benefits to changes in some other

measure, such as company profits, plant output, the Consumer Price Index, or the

market price of a commodity. Contingent compensation payments may take the form,

for example, of a lump sum payment in cash or company stock, or a wage rate

increase.

CONTRACT SIGNING BONUS

A non production bonus given to unionized employees upon signing of a new labor-

management agreement.

CONTRIBUTORY PLANEmployee benefit plan, which is not 100 percent, paid for by the employer. To receive

plan benefits, an employee must contribute (pay) a specified amount towards the full

cost of the plan. For example, employer pays 100 percent of the cost of health

insurance for the employee but pays only 40 percent of the cost of health care

services for employees dependents.


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CONSUMER PRICE INDEXAn economic indicator used to gauge the cost of living published by The Indian Bureau

of Labor Statistics. It measures price changes for a fixed market basket of goods and

services typically purchased.

D----------

DOWNGRADING:The movement of a job to a lower level in a job-evaluation system (i.e., to a lower job

grade and/or pay range within a pay structure).

DEFERRED EARNINGSThese are the earnings that an employee voluntarily places in a retirement account.

Deferred earnings are not taxed as income at the time the money is earnedincome

taxes are deferred until benefits are distributed from the retirement account.

DEFERRED WAGE CHANGEA negotiated wage change (almost always an increase) that will become effective at a

specified date beyond the effective date of the contract. Usually found in multi-year

contracts

DIFFERENTIAL PIECE RATESPlan under which piece rates vary at different levels of output talks refers to

differential piece rates.


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DOUBLE TIMEPenalty or premium rate (e.g., for overtime work, for work on Sundays and holidays)

amounting to twice the employees regular rate of pay for each hour worked.

DRAW ACCOUNTUsually, an allowance given to sales people working on a straight commission as an

advance against commission payments

E----------

EQUITYWhen used in reference to direct pay this concept refers to a criterion of pay based on

similar responsibilities and contribution to the organization. It may focus on the

"fairness" of pay between employees within or outside the organization.

EXCHANGE RATEIt is economically defined as intersect of the labor demand and the labor supply

functions in an external market. It constitutes the wage rate that employers are

willing to pay and labor is willing to accept. From a compensation viewpoint, the

exchange rate defines the criterion of external equity.

EXTRINSIC REWARDSWork-related rewards that have value measurable in monetary terms, as opposed to

intrinsic rewards, such as satisfaction in a job well done.


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EARNINGS (HOURLY; DAILY; WEEKLY; ANNUAL COMPENSATION)Remuneration (pay, wages) of a worker or group of workers for services performed

during a specific period of time.

EDUCATION LEAVELeave, typically without pay, to employees wishing to attend an accredited college or

university or recognized trade, vocational or technical school to take a course of study

or training related to their jobs or employment opportunities at the company.

EDUCATIONAL ASSISTANCE (TUITION AID; TUITIONPAYMENT PLAN)It is a program that provides full or partial payment for tuition or books or both for

training or educational courses.

EDUCATIONAL PAY DIFFERENTIALUsually for professional occupations such as teachers, educational pay differentials

provide for progressively higher salary rates based upon the employees completion of

specified academic requirements. For example, a person having a Ph.D. would receive

higher pay than another having a masters degree, or an employee with a masters

degree would receive a higher salary than another having a bachelors degree.

ELDER CAREA program that provides paid or unpaid time off for the purpose of caring for sick or

elderly parents, and employer sponsored or subsidized adult day care.

EMPLOYEE BENEFIT PLANA plan established or maintained by an employer, employee organization or both

(through negotiated agreement or unilaterally) to provide employees with welfare or

retirement benefits or both.


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ENTRANCE/ HIRING RATEWage rate at which an employee starts a job. The rate may apply to a new hire or to a

worker who changes jobs within the establishment.

EX-GRATIA PAYMENTAn ex gratia payment is a payment made without the giver recognizing any liability or

legal obligation. When something has been done ex gratia, it has been done

voluntarily, out of kindness or grace. Most commonly such payments are made to

employees in respect of personal property (including clothing or personal items such as

spectacles) damaged or lost accidentally. Ex gratia payments are not made in

situations where the loss is fully insured, either by the individual or the CountyCouncil. It may be given for other purposes as well. For example, a lump sum payment

over and above the pension benefits of a retiring employee.

EXTERNAL EQUITYIt is a measure of an organizations pay levels or salary ranges compared to that of its

labor market competitors. External equity implies that the employer pays wages that

are competitive with prevailing external market pay rates, as determined by marketpricing.

F----------

FIXED PAY

It is nondiscretionary compensation that does not regularly vary according to

performance or results achieved. The persons getting fixed pay can expect a fixed

amount at the end of the month as long as they meet the minimum quota.
http://www.businessdictionary.com/definition/employee.htmlhttp://www.businessdictionary.com/definition/employee.html


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FACTOR COMPARISON METHODA job evaluation method in which a series of rankings are performed to assess which

jobs contain more of each specific compensable factor than other jobs being

evaluated The factor rankings of each job are assigned numerical values, weightedand then added together to determine the total job score.

FIXED INCREASE AMOUNTSpecified amount of increase based on performance level determined in advance and

unchanging from employee to employee.

FLEXIBLE BENEFIT PLAN (CAFETERIA PLAN)It is a plan that provides employees with options to choose among a number of plans

covering several different benefits. They often consist of a core package of benefits

(vacations, low option health insurance, etc.) that employees must take. In addition,

an optional package may be offered from which employees can select specific benefits

(high option health, life and long-term disability insurance, extra vacation days, child

care expenses, etc.) that they desire.

FLEXIBLE WORK SCHEDULE PLAN (FLEXITIME)It is a work schedule plan that allows employees to determine their own work hours

within generally set parameters. Typically, employees are required to be at work a

minimum number of core hours each day (e.g., from 10 a.m. to 3 p.m.), but the

start and end time or total hours worked varies according to employee preference.

FRINGE BENEFITAnything in addition to Guaranteed Cash Compensation i.e. beyond the regular benefit

of being paid for work is Fringe Benefit. Some fringe benefits are fairly standard, such

as offering a few days of sick time or paid vacation time. Others can be significantly

greater, and rarer. It means compensation due to an employee pursuant to a written
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contract or written policy for holidays, time off for sickness or injury, time off for

personal reasons or vacation, bonuses, authorized expenses incurred during the course

of employment, and contributions made on behalf of an employee. In simple terms, it

includes all the monetary and non-monetary benefits beyond salary.

FRINGE BENEFIT TAXA tax on benefits that employees receive or enjoy as a result of their employment is

called fringe benefit tax. Fringe Benefit Tax (FBT) is a tax levied on perquisites-or

fringe benefits -provided by an employer to his employees, in addition to the cash

salary or wages paid. Fringe Benefit Tax was introduced in India in the year 2005-2006.

NOTE: Budget 2009-10. Fringe Benefit Tax Abolished

FLOATING HOLIDAYA holiday that can vary from year to year, the day on which the holiday is observed

being selected by the employer or the employee

FUNERAL LEAVE (BEREAVEMENT LEAVE)It is the Paid time off due to a death in the family.

G----------

GAIN SHARINGIt rewards employees for exceeding a predetermined goal by sharing the extra profits.

If profits exceed the goal, employees share in the extra profits. The focus here is on

the productivity gain rather than on profits of company, meaning that employees in a

gain sharing plan can receive incentive awards even when the organization isnt

profitable


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GROUP HEALTH PLANA plan that provides medical benefits for the employers own employees and their

dependents through insurance or otherwise (such as a trust, health maintenance

organization, etc.)

GROUP INCENTIVE PLANPayment of incentive earnings based on the output of a group of workers (team,

department, etc.) rather than the output of the individual worker.

GEOGRAPHIC DIFFERENTIALSThese are the Pay differences established for the same job based on variations in costs

of living or costs of labor among two or more geographical areas.

H----------

HAZARD PAYExtra pay to an individual worker or a group of workers working under dangerous or

undesirable conditions is termed as Hazard Pay.

I----------

IN-RANGE ADJUSTMENTIt is to adjust pay within the existing salary range.


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INTERNAL EQUITYIt refers to the pay relationships among jobs internal to the organization. It is a

standard that fairly establishes a pay level that corresponds to each job's relative

value to the organization INCENTIVE (PAY PLANS)

Pay plans designed to reward the accomplishment of specific results and achievement

beyond and above the defined normal job requirements. Awards are usually tied to

expected results identified at the beginning of the performance cycle. The plans can

be individual, group, companywide, or a combination of any. Incentive plans are

"forward" looking; bonus plans look "backward."

INDIRECT PAYIt includes all forms of nondirect (i.e., noncash) compensation made to employees in

exchange for their contribution to an organization.

INTRINSIC REWARDSRewards those are associated with the job itself, such as the opportunity to perform

meaningful work, complete cycles of work, see finished products, experience variety,

and receive feedback on work results.

INSURANCEA method of providing or purchasing protection against some or all of the economic

consequence of a loss is known as insurance. For employee benefits purposes, it is full

or partial coverage for the financial losses and expenses that can result from employee

injury, illness, disability, or death


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INSURANCE CARRIERA commercial insurer that underwrites or administers insurance policies or does both

for such programs as life insurance, health care, short-term disability, and long-term

disability benefits.

INSURANCE POLICYThe contract between an insurance carrier and an insured employer under which the

carrier agrees to pay the policy benefits when specific losses occur, providing the

carrier receives the required premiums. The policy presents in detail the benefit plan

provisions.

J----------

JOBThe total collection of tasks, duties, and responsibilities assigned to one or more

positions which require work of the same nature and level.

JOB ANALYSISIt is the systematic, formal study of the duties and responsibilities that comprise job

content. The process seeks to obtain important and relevant information about the

nature and level of the work performed and the specifications required for an

incumbent to perform the job at a competent level.

JOB DESCRIPTIONA summary of the most important features of a job, including the general nature of

the work performed (duties and responsibilities) and level (i.e., skill, effort,


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JOB WORTH HIERARCHYIt is the perceived value of jobs in relationship to each other within an organization.

The job worth hierarchy forms the basis for grouping similar jobs together and

establishing salary ranges.

K----------

KNOWLEDGE-BASED PAYA system of salary differentiation based on the formal education, related experience

or specialized training a professional employee has that qualifies the individual to deal

with specific subject matter, or work effectively in a specific field. Salary level may

not be dependent on whether the incumbent utilizes the knowledge.

KSA (KNOWLEDGE, SKILLS, AND ABILITIES)These include the Common job specifications. Knowledge refers to acquired

information necessary to do the job (e.g., principles of nuclear physics). Skills refer to

acquired measurable behaviors (e.g., autoclave operation). Abilities refer to natural

talents or acquired dexterity (e.g., capacity to lift 200 pounds).

L----------

LABOR DEMANDThe highest wage an employer is willing to pay for a given level of employment or

number of employees.


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LIVING WAGEA wage sufficiently high to permit a worker to keep a given standard of living is

termed as living wage.

LONGEVITY PAYA specified increase in hourly pay rate, a lump sum payment, or a form of bonus (e.g.,

government savings bond, add-on to severance pay, etc.) paid to employees based

upon their length of service

LUMP-SUM PAYMENTSComplete non-recurring payments consisting of a single sum of money are the lump-

sum payments. These are made to employees in lieu of a general wage rate increases.

The payment may be a fixed amount as set forth in a labor agreement or an amount

determined by a formula. Lump-sum payments are not incorporated into an

employees base pay rate or salary.

LABOR MARKETIt is a place where labor is exchanged for wages. These places are identified and

defined by a combination of the following factors: (1) geography (i.e., local, regional,

national, international), (2) industry, (3) education, licensing or certification and (4)

function or occupation.

LEAD OR LAG POLICYIt is to match, follow or exceed the market when adjusting pay structures

LEAVE TRAVEL ASSISTANCELTA is paid for meeting travelling expenses incurred by an individual as also family

members (this includes only the spouse, two children and dependent parents, brothers

and sisters) while on holiday in India. The amount of exemption depends upon the


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mode of journey. This exemption is available in respect of 2 journeys undertaken in a

block of four calendar years.

LOWER QUARTILE OR 25TH PERCENTILEIn the case of private sector pay, the term refers to the level that separates the top

75% paying organizations from the 25% lower paying organizations or individuals as the

case may be.

M----------

MERIT INCREASEAn increase in the wage rate of a worker, usually given on the basis of certain criteria

of worth (e.g., efficiency and performance) is termed as merit increase.

MERIT PAYIt is a compensation system whereby base pay increases are determined by individual

performance.

MERIT INCREASEAn increase to an individual's base pay rate based on performance is termed as merit

increase.

MERIT RATINGA method for appraising the performance of an employee with respect to his or her

job is merit rating. It frequently serves as a basis for making pay adjustments,

promotion decisions, or work reassignments.


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MIDPOINTThe middle value of the reported salary range or pay grade is the midpoint

MINIMUM WAGERate of pay, established by law or through collective bargaining, below which workers

cannot be employed, is the minimum wage. It is usually expressed as a daily rate.

MAXIMUM RATEThe highest rate reported for the salary range.

MARKET ADJUSTMENTThe adjustment that is necessary for an individual or an organization to bring the

individual or organization to approximate market values.

MEDIANIn the case of private sector pay, the term refers to the level that separates the top

50% paying organizations from the remaining organizations or individuals as the case

may be

N----------

NONCONTRIBUTORY PLANAn employee benefit plan that is completely paid for by the employer.


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P----------

PAYTo remunerate for the effort/work/services done/rendered by a person is termed as

pay.

Also it is defined Compensation made for services or competencies brought to

workplace (usually cash compensation)

PAIRED COMPARISONA ranking technique that compares each job being evaluated individually to every

other job in a pair-wise fashion to determine which job has a higher value. Ranks of

jobs are created which can than be pegged to the market via benchmark jobs.

PROFIT SHARINGIt gives the employee a portion of the company profits. Profit sharing is often done

through making shares of company stock part of the employee benefit package. This

type of reward distributes compensation based on some established formula designed

around a companys profitability. Employees receive a certain number of shares of

stock each year, which provides employees an incentive to help the company succeed.

This might also be accomplished through a yearly profit-sharing bonus.

PAY ADJUSTMENTA general revision of pay rises. The adjustment may be either across-the-board, such

as cost-of-living adjustments (COLA), or spot adjustments for increases in prevailing

wage rates.


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PAY PLANA schedule of pay rates or ranges for each job in the classification plan is called a pay

plan. It may include rules of administration and the benefit package.

PAY POLICYAn organizations guidelines on how to determine the level of a job-holders

compensation; may include a reference to a position in the pay market (e.g., median),

a target pay level, a range of a minimum to a maximum, a defined level of cash

allowances, and eligibility for variable pay.

PAY GRADE/RANGEUsually established within an organization, this refers to the levels or hierarchy of job

and pay ranges i.e. range of pay from minimum to maximum. It is also referred to as

the salary structure, job grades, job-evaluation points and or policy lines.

PAY RANGE WIDTHThe width or spread of a pay range, measured by the ratio: Width = (maximum pay -

minimum pay)/minimum pay.

PAY STEPSSpecified levels within a pay range. Employees may progress from step to step on the

basis of time-in-grade.

PERSON-BASED PAYCompensation programs that base an employee's salary on that individual's skills or

knowledge rather than on the nature of a rigidly defined job. Types include skill-,

knowledge-, and competency-based pay.


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PAY LEVEL STATISTICSAny group of statistics that indicate the levels and prevalence of pay practices in a pay

market, including upper quartile, median, lower quartile, average and weighted

average is termed as pay level statistics. PERQUISITE/PERKS

Perquisites or 'perks' as they are popularly known is the monetary content of fringe

benefits. Perks are taxable according to Indian tax laws.

A perquisite is any casual emolument, fee or profit attached to an office or position in

addition to the salary or wages. In other words, perquisites are the benefits usually in

kind in addition to normal salary to which the employee has a right by virtue of his

employment/position in an organization. Perquisites are those facilities which the

position carries.

To be considered non-taxable, a perquisite must be a requirement or condition of

employment

Taxable perquisites are defined as any non-cash item of real income provided to an

employee that is not classified as a non-taxable perquisite.

Not e: The basic difference between fringe benefits & perquisite is that while fringe

benefits are not clubbed with salary & the tax on the same is paid by the employer,

the perquisites are clubbed under the head "income from salary" & tax accordingly to

employee. Thus while fringe benefits are taxed in the hands of employer, the

perquisite are taxed in the hand of employee himself.

PAY PERIODA pay period is the number of days for which a regular, usually non-salaried employee

gets paid. Salaried employees tend to expect and receive the same pay no matter the

length of the pay period, while workers paid by the hour can have variance in pay

depending upon hours and days worked. Pay periods vary widely and usually are one of


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several common systems. You may be paid weekly, bi-weekly, monthly, yearly, or paid

twice a month on specific dates, usually the 1st and 15th of each month.

PAY SCALEA pay scale is a document or table designed to determine how much an employee will

earn in his or her job. Many companies have a pay scale set up before hiring new

employees, which they show to prospective employees before hiring them. In this way,

the job seeker can get a good idea of how much he or she can expect to earn while

working for the company or business.

PAY ROLLThe term 'payroll' encompasses every employee of a company who receives a regular

compensation. Some employees may be paid a steady salary while others are paid for

hours worked or the number of items produced. All of these different payment

methods are calculated by a payroll specialist and the appropriate paychecks are

issued. Companies often use objective measuring tools such as timecards or

timesheets completed by supervisors to determine the total amount of payroll due

each pay period.

PAID LUNCH (MEALTIME)It is period of time, normally 30 minutes to one hour, for employees to eat and rest.

PAID VACATIONSTime-off from work normally taken in days or weeks that provide employees with a

rest or break from work. The amount of time-off may vary based on an employees

length-of-service with the employer or it may be a fixed number of days or weeks. The

time-off is normally paid for at an employees normal hourly rate or salary.
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PAYROLL DEDUCTIONSAmounts withheld from employees earnings by the employer for Social Security, State

income taxes, and other governmental levies, union dues, group insurance premiums,

and other authorized wage assignments.

PAYROLL PERIODFrequency with which workers wages are calculated and paid, usually weekly,

biweekly, semimonthly or monthly

PIECEWORKMethod of wage payment based on the number of units produced, or any work for

which piece rates are paid

PIECE RATEPredetermined amount paid per unit of output to worker under a piecework incentive

plan Piece Rate: A direct performance payment based on production by an individual

worker. A payment is made for each piece or other quantity unit of work produced by

an employee.

PREMIUM PAYCompensation at greater than regular rate is Premium Pay, i.e. It is the Extra pay,

beyond the base wage rate, for work performed outside or beyond regularly scheduled

work periods.

PREVAILING RATE (GOING RATE)Term may be used in varying contexts. It may refer to average level of wages paid by

employers for specific occupations in a community or area; or rate most commonly

paid; or rate paid to most workers; or rate established by union contracts.


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PROBATIONARY RATETrial rate of pay for an experienced and otherwise qualified worker during the initial

period of his employment on a new job in a new plant is the probationary rate.

PUSH MONEYMoney paid by a supplier of goods or services, directly or indirectly through the

employer, to retail salespeople as an incentive to increase sales of the goods or

services. Department store cosmetics sales persons often receive push money

payments.

R----------

REMUNERATIONPayment or compensation received for services or employment. This includes the base

salary and any bonuses or other economic benefits that an employee or executive

receives during employment. This term often refers to the total compensation

received by an executive, which includes not only the base salary but options,

bonuses, expense accounts and other forms of compensation.

The term remuneration and compensation are used interchangeably and mean one and

the same.

REIMBURSEMENTIt is the act of compensating someone for an expense. Often, a person is reimbursed

for out-of-pocket expenses when the person incurs those expenses through

employment or in carrying out duties for another party.


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RECOGNITION:Recognition is non-financial and, most significantly, it is the responding to a

psychological need of every individual. In addition to wanting to contribute, we all

need to know our contributions and accomplishments are noticed and appreciated. Itcan be viewed as Emotional Income.

An effective recognition process includes specific actions designed to reinforce and

encourage desired behaviors and contributions. These are then acknowledged and

celebrated. Since we are responding to a need, recognition gestures have a high

intrinsic value.

REWARDSRewards are financial incentives intended to direct employee activity towards a

particular outcome. Financial incentives by themselves do not act as motivators. They

work to stimulate and satisfy an employees desire for monetary gain. Reward systems

typically allow employees to share in the financial impact of their contribution.

Exclusive financial aspect of Rewards differentiates it from term Compensation which

includes both financial as well as non financial aspects.

RANGE PENETRATIONThe level of an individual's pay compared to the total pay range (rather than compared

with midpoint, as in compa-ratio). Range penetration is calculated as:

RP = (Pay - Range Minimum) / (Range Maximum - Range Minimum).

RATE RANGEThe lower and upper limits of wage rates paid to workers in an occupation.

RATE SETTINGProcess of establishing wage or piece rates for a job or operation


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RATE ARRANGEDWhere a position has no formal salary range assigned but is assigned a working range

based on it's comparability with other like positions.

RECLASSIFICATIONIt is moving a job to a higher or lower range in the hierarchy of classifications because

of a change in the job duties of the position.

REWARD SYSTEMA formal or informal program used to recognize individual employee achievements,

such as accomplishment of goals or projects or submission of creative ideas.

REAL WAGESPurchasing power of money wages, or the amount of good and services that can be

acquired with money wages

RED CIRCLE RATE (OUT OF LINE RATE; FLAGGED RATE)A wage rate exceeding the formal pay rate or range of rates for a job due to such

factors as the employees long service with the company, superior skills, or other

factors.

REFERRAL BONUSMoney payment made to an employee as a bonus for aiding in the recruitment of

another person hired by the company.

RELOCATION ALLOWANCE (MOVING ALLOWANCE)Money paid to an employee to cover the cost of moving from one locality to another as

a result of a permanent change in duty station. Payment may cover costs of moving


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personal items, real estate brokerage fees, the loss of money on the sale of the

employees residence, or the living costs for a period of time spent looking for a

residence in the new locality

ROLL UPIncorporation of cost-of-living allowances or longevity pay into an employees regular

base pay rate or salary.

S----------

SALARYA salary is an agreed upon amount of pay that is to be extended at regular intervals, in

exchange for the competent performance of specific tasks within the workplace.

Being on salary usually also includes some perks that may or may not be applicable to

wage related work. For instance, salaried positions usually accrue sick days and

vacation days that may be used when needed. Not all hourly positions provide those

types of benefits. Second, being on a salary means that you always know what amount

of money is coming into the household. With a wage, the amount may vary from one

pay period to another.

SALARY STRUCTUREThe structure of job grades and pay ranges established within an organization refers to

salary structure. The salary structure may be expressed in terms of job grades, job

evaluation points or policy lines

SALARY RANGE WIDTHThe width or spread of a pay grade range, measured by the ratio:


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Width = Maximum pay - Minimum pay

------------------------------------

Minimum pay

SALARY SURVEYThe gathering of data on wages and salaries paid by other employers for

Benchmark jobs

SKILL-BASED PAYA person-based remuneration system based on the repertoire of jobs an employee can

perform rather than the specific job that the employee may be doing at a particular

time. Pay increases generally are associated with the addition and/or improvement of

the skills of an individual employee, as opposed to better performance or seniority

within the system.

SAFETY BONUSA Nonproduction bonus paid to employees for maintaining a high level of safety in the

workplace.

SEVERANCE PAY (DISMISSAL PAY OR ALLOWANCE; TERMINATION PAY;SEPARATION PAY; LAYOFF ALLOWANCE)

Monetary allowance paid by employer to displaced employees, generally upon

permanent termination of employment with no chance of recall, but often upon

indefinite layoff with recall rights intact. Plans usually graduate payments by length of

service.

SHIFT DIFFERENTIAL (SHIFT PREMIUM)Additional compensation (rupees per hour or percentage of day rate) paid to workers

employed at other than regular daytime hours.


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SIGNING BONUSA form of lump sum payment provided to employees upon ratification and signing of

the agreement. May also refer to a bonus paid when an employee signs an employment

contract.

STANDARD RATEUsually, a uniform rate of pay established for an occupation or craft in an area or

industry through collective bargaining or by law.

STEP RATESFixed levels between the minimum and maximum rates for an occupation in a wage

progression system are referred as step rates. Standard progression pay rates that are

established within a pay range. Step rates usually are a function of time in grade and

are often referred to as "automatic". However, they can be variable or can be used in

conjunction with merit programs.

SINGLE-RATE SYSTEMA remuneration policy under which all employees in a given job are paid at the same

rate instead of being placed in a pay range is called Single Rate System. Generally

applies in situations where there is little room for variation in job performance or skill

level.

STOCK OPTION PLANPlan allowing employees or officers the privilege of purchasing company stock (shares)

at a certain price at a time of their own hiring, usually within time limits set by the

employer is stock option plan.


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STOCK PURCHASE PLANPlan enabling employees to purchase stock (shares) in the company, with or without

employer contributions, usually under more favorable terms than are available on the

open market is stock purchase plan.

SUBSIDIZED COMMUTINGProgram where employers subsidize employees cost of commuting to and from work

via public transportation, a company sponsored van pool, discounted subway or bus

fares, etc.

SUPPLEMENTAL PAYPremium pay for overtime and work on weekends and holidays; shift differential pay;

and non wage cash payments.

STATISTICAL TERMSMinimum: The Lowest value in the group when hierarchically arranged

Maximum: The Highest value in the group when hierarchically arranged

Range: The difference between the minimum and the maximum value

Median: The middle value in the group when hierarchically arranged

Arrange the values in an ascending order

In case of Odd number of values- The median is the middle value in the series

In case of Even number of values- The median is the average of the middle two

numbers


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Average: The summation of all the values divided by the number of values

Sum of All Values

-----------------------

Number of Values

T----------

TIERED PAY PLANA remuneration system that differentiates salary based on time of hire (i.e., new

employees are paid less than current employees for performing the same or similar

jobs) as well as on nature of work performed.

TAKE HOME PAYIt includes usually, earnings for a payroll period, less deductions (legal and

authorized); the amount of cash the worker takes home.

TELECOMMUTINGWork at satellite offices or at home using a computer and related equipment that links

the telecommuter to the employers main office. The telecommuter may be required

to spend some time (e.g., 1 or 2 days each week) in the main office.

TEMPORARY RATESWage or piece rates set tentatively on new job tasks performed by workers in an

occupation; sometimes called experimental or trial rates.


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TONNAGE RATEPay on the basis of tons of material handled, common in basic iron and steel and coal

mining.

TOOL ALLOWANCEAllowance to an employee, paid by the employer, as reimbursement for the cost of

tools and their upkeep, where the employee furnishes his own tools or is responsible

for their maintenance.

TOTAL CASH COMPENSATIONThe sum of all monetary payments made to an individual for services (i.e.,

employment) during a given year.

TOTAL REMUNERATIONThe sum of the financial and nonfinancial value to the employee of all the elements in

the employment package (i.e., salary, incentives, benefits, perquisites, job

satisfaction, organizational affiliation, status, etc.) and any other intrinsic or extrinsic

rewards of the employment exchange that the employee values.

U----------

UNION DUESFee paid periodically, usually monthly, by members of a union, typically as a condition

of continued membership. Each union sets its own dues requirements. Under some

collective bargaining agreements, nonmembers may be required to pay the equivalent

of union dues or a portion as a condition of continued employment.


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UNION RATE (SCALE)Minimum rate (hourly or weekly) paid to qualified workers in a specific occupation or

trade under the terms of a union agreement.

UPGRADINGIt is a process of raising the pay level of a job relative to other jobs or of advancing

workers to jobs with higher skills and rates of pay.

UPPER QUARTILE OR 75THPERCENTILE LEVELIn the case of private sector pay, the term refers to the level that separates the top

25% paying organizations from the 75% lower paying organizations or individuals as the

case may be.

V----------

VARIABLE PAYVariable pay is compensation that is contingent on discretion, performance or results.

Variable pay links employees' earnings to the performance, good or bad, of an

organization, department or unit / section. In a successful period the potential to earn

more could be substantive. However, if performance is poor the workforce has to take

some responsibility for this and ultimately be prepared to face a financial penalty.

Variable pay is used generally to recognize and reward employee contribution toward

company productivity, profitability, team work, safety, quality, or some other metric

deemed important. Some companies will reward the employee even if company is not

performing but if the employee is performing.


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W----------

WAGE RATEPayment for labor or services to a worker, for a given unit of worktime normally on an

hourly, daily, or weekly basis or by the piece is the wage rate. It is exclusive of

premium payments for overtime, shift differentials, cost-of-living allowances, etc. It is

usually given to employees performing physical work and are generally at low levels of

the job hierarchy

WAGE DETERMINATIONIt is a process of establishing wage rates and wage structures through collective

bargaining, employer determination, arbitration, or other methods.

WAGE DIFFERENTIALSDifferences in wages among occupations, plants, areas, industries, type of worker,

WAGE FREEZE

Action taken to freeze all employees at their current wage or salary rate, nullifying

anticipated increases due to longevity pay, merit increases, cost-of-living

adjustments, within-grade pay increases, etc. It is normally taken as a temporary

measure in response to poor sales or a decrease in company profits.

WAGE PROGRESSIONPlan providing within grade pay increases, generally at specified time intervals or on a

merit basis, for workers in occupations having established minimum and maximum

wage rates


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WAGE SURVEYA survey of a labor market to determine the going rates for benchmark jobs

WAITING PERIODIt is duration of time between beginning of a benefit qualifying event and the start of

actual benefit receipt. For example, a short-term disability plan may have a 5-day

waiting period before benefits will be paid.

WELLNESS BENEFITSPreventive insurance benefits such as payments for annual physical examinations,

health check ups, and childrens vaccinations

WORKING TITLEUnofficial job titles that can be used to more appropriately provide clarity for job

postings or convey a message to the outside world of the work performed. Working

titles are permitted if needed for purposes stated above, and as long as the working

title does not misrepresent the authority or the function of the position.

WAGE GARNISHMENTWhen an employer withholds the earnings of the individual in order to pay off some

loans or debts is known as wage garnishing.

WEIGHTED AVERAGEAn average in which each quantity to be averaged is assigned a weight. These

weightings determine the relative importance of each quantity on the average.

c & b glossary

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