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JEEV SEWA SANSTHAN GROUP OF INSTITUTIONS FOR WOMEN:

FACULTY OF MANAGEMENT

PGDM II SEMESTER SPECIAL EXAMINATION PAPER

JUNE 2013

Compensation Management (HR-7)

Maximum marks: 30 Duration: 1 Hour

Note:Attempt all question, each carries equal marks. (10 Questions) 1 mark

1) Which of the following is the fixed component in compensation packages?a) Profit-sharingb) Base salaryc) Gain-sharingd) Equity stock options

2) _______ ensure that the employees get an income which is sufficient for meeting theirpresent and future necessities and contingencies.

a) Real wagesb) Minimum wagesc) Living wagesd) None of the above

3) Workers compensation provides benefits to workers who are injured:a) At home and away from work but require hospitalization.b) Driving to and from work.c) While at work.d) At a store buying products produced by their employer.

4) Which of the following is not usually a group incentive plan?a) Halsey incentive planb) Priestman bonus planc) Rucker incentive pland) Townes incentive plan

5) The most commonly used reward in organizations is:a) ESOPsb) Commissionsc) Profit Sharingd) Money

6) Real wage are:a) Wage divided by a cost of living of consumer price index.b) Earning minus deduction for tax, PF etcc) Total of all compensation including wages and special pay interest dividends etc.

PART - A

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d) None of these7) Which of the following is not an objective of wage incentive programmes?

a) Developing ownership interestb) Improving employee retentionc) Reducing labour costd) Facilitating the separation of employees

8) The statutory minimum bonus is ________(a) 8.33%

(b) 10%

(c) 24%

(d) 20%

9) Insurance schemes, retirement benefits and leave travel concession are examples ofa) Indirect monetary compensationb) Direct monetary compensationc) Non-monetary compensationd) None of the above

10)Performance-based annual bonuses are an example ofa) Base salaryb) Short-term incentive planc) Long-term incentive pland) All of the above

Note:Attempt any 1 out of 8, all question carries equal mark. 2 Mark each

1) Explain the term wages.2) Define Compensation.3) Explain Non Monetary Rewards.4) What is wage differential.5) Define Wage Board.6) Define Pay Commission.7) Explain Wage Structure.8) Explain direct Compensation.

Note:Attempt any 1 out of 5, all question carries equal mark. 8 Mark each

1) Explain the Concept Golden Parachute & its Importance?2) Explain intrinsic reward Cafeteria style of Compensation?3) What are the Various Guidelines of Companies Act Relating to CEO Compensation?4) What are the Various Fringe Benefits & Supplementary Compensation Provided to

Workers?

5) Explain the Future Trends with respect to Compensation Management?

GROUP B

GROUP C

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Case Study 10 Marks

The case discusses the compensation management practices at Tata Consultancy Services Ltd.(TCS), one of the leading Indian IT companies. TCS' compensation management system was

based on the EVA model. With the implementation of Economic Value Added (EVA)-based

compensation, the salary of employees comprised of two parts fixed and variable. The

variable part of the salary was arrived after considering business unit EVA, corporate EVA, andalso individual performance EVA

During the fourth quarter of the financial year (FY) 2007-2008, TCS announced its plans to

slash 1.5 percent of the variable component of employee salaries since its EVA targets for the

third quarter of FY 2007-2008 were not met

The announcement came as s jolt not only to TCS employees but also to the entire Indian ITindustry. The company came in for severe criticism and it was accused of not being transparent

with respect to EVA calculation. However, some analysts felt that the pay cuts were a result ofthe macroeconomic challenges that the Indian IT companies were facing -- rapid appreciation of

the rupee against the US dollar and the recession in the US economy (USA was the largestmarket for the Indian IT companies)

Analyze TCS' HR practices with respect to its policy related to compensation of its employees.

Discuss various concepts related to compensation management.

GROUP D