Compensation

Employee contribution

Employee contribution is not dependable on the organization compensation plan only but there are some other factors that influence or govern an employee's contribution towards the organizational objective. Success depends on finding people with ability that primary job of requirement, selection, and training. Once good people are hired, they need to be motivated to behave in ways that help the organization. This is where compensation enters the picture. Pay and other rewards should reinforce desired behaviors. They should make sure that what expected of employees, and what is measured in regular performance review, is consistent with what the compensation practices are doing.

There are several ways in reinforcing compensation in an organization. Firstly, compensation should be sufficiently attractive to make recruiting and hiring good potential employees possible. This is one of the best way or method to attract potential employees in the market. Secondly, they should make sure the good employees stay with their company. If they can succeed at these two things, they can then concentrate on building further knowledge and skills. Finally, they need to find ways to motivate employee to perform well on their jobs to take their knowledge and abilities and apply them in ways that contribute to organizational performance.

Tenaga Nasional Berhad is one organization that emphasizes on their compensation plans. Tenaga Nasional consists of more that 20,000 employees and its compensation plan satisfies its employees. Tenaga Nasional also offer intrinsic rewards to its employees, these are internal awards workers give themselves such as self esteem which is a sense of accomplishment and the feeling of growth or development of special skills and talents. At the same time their employees should perform well in their task so that the management will not hesitate to reward them.

Pay Plan System

Tenaga nasional Berhad implements several plans in determining their compensation plans towards to their employees. Its compensation plans has been segregated into specific work that the organization offers to its employees. There are several factors in designing compensation method such as day work plan, measured day work plan, piece- rate plan, standard-hour wage plan, gain sharing plan, and direct- wage group incentive plan.

Day work plans compensate the employees on the basis of no of hours worked times an established hourly based rate. Company policies that stimulate employee morale and result in good productivity without direct rating compensation to production fall into the sound day rate classification. Such overall TNB policies are fair, and their relatively high based rate, based upon job evaluation, merit rating, sound suggestion system, a guaranteed annual wage and relatively fringe benefits, build healthy employee attitude, which tend to stimulate and increase productivity.

Measured day work plan is some sort like day work plan except employees are expected to meet certain production standard. In Tenaga Nasional Berhad Repair and Maintenance Company, their employees are required repair as much as product they can within the stated period. For example, the management will reward their employees based their performance level, the more product the employee able to repair the more reward they can claim.

Piece-rate plans are also known as piecework. Employees are paid a fixed amount per unit repair regardless of the number of units repaired. In the United State, piecework is not common because of the minimum wage law. According to tenaga nasional berhad, compensation plan it has a border line for production or other work that has an outcome. Employees need to produce more than the border line in order to obtain higher rewards.

Standard-hour wage plan is similar to piecework expect that employees are guaranteed some based wage. For example an employee produce 10 units per hour doing a job having a standard- hour pay plan with a production standard of 8 units per hour and base wage of RM 10 per hour. How mush does the employee earn per forty- hour week.

= (Base hourly wage* hours worked* hourly production rate) / (hourly production rate at which bonus begins).

= (RM 10 per hour* 40 hours * 10 units per hour) / (8 unit per hour)

=RM