Rewards and Compensation

Part VI

A project report submitted in partial fulfillment of the requirements

For the Course HRM 221, Human Resource Management for Bachelors in Business

Administration (BBA), Year II, Semester II

Submitted To:
Ms. Monika Devkota

Faculty of Fundamentals of Human Resource Management

Kathmandu University School of Management

Gwarko, Lalitpur

Submitted By:
Section C
Group C
Aditya Pandey(217067)
Binisha Byanjankar (217029)
Jeena Hongwa (217042)
Niket Kumar Yadav (217119)
Prakriti Shrestha (217097)
Sukriti Adhikari (217007)

Jul 4, 2023
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Table of content
1. Reward and compensation policy in Web Trading Concern Pvt. Ltd............................................................
2. Limitations of the reward and compensation policy in WTC Pvt. Ltd...........................................................
3. Recommendation for rewards and compensation policy for WTC Pvt. Ltd..................................................
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1. Reward and compensation policy in Web Trading Concern Pvt. Ltd.

The reward and compensation policy in WTC Pvt. Ltd. can be summarized as below:
● Base Pay
Web Trading Concern Pvt. Ltd. recognizes the importance of providing
competitive base salaries as part of its reward and compensation policies. The company
conducts regular salary reviews to ensure employees receive fair compensation aligned
with market standards. Through market research and job evaluations, the company
establishes a well-defined salary structure that outlines minimum, midpoint, and
maximum salary ranges for each position. Performance-based increases and experience-
based increments are utilized to reward employees for their contributions and tenure
within the organization. Transparent communication about the salary review process and
compliance with labor laws further emphasize the company's commitment to fair
compensation practices. By implementing these measures, Web Trading Concern Pvt.
Ltd. aims to attract and retain talented individuals in the healthcare sector while fostering
a motivating and rewarding work environment.

● Commission Structure
Web Trading Concern Pvt. Ltd. recognizes the significance of motivating and
rewarding its sales and business development teams. To achieve this, the company
implements a commission structure that offers a percentage of sales revenue generated.
This commission-based system serves as a powerful incentive for employees to actively
pursue new business opportunities and drive sales growth. By linking individual
performance directly to financial rewards, the commission structure encourages
employees to maximize their efforts and achieve outstanding results. This not only boosts
employee motivation and engagement but also aligns their interests with the company's
overall success. Through the commission structure, Web Trading Concern Pvt. Ltd.
creates a dynamic and performance-driven sales environment, where employees are
incentivized to achieve exceptional outcomes and contribute to the company's growth.
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● Medical Insurance
WTC Pvt. Ltd. has a policy of medical insurance worth about Rs. 1 lakh. It helps
with employee retention and gives employees a sense of belonging to the organization as
they feel that the company cares about them. Knowing that they are protected against
unexpected events, such as medical emergencies or unforeseen illnesses, can significantly
alleviate stress and anxiety, which has ultimately resulted in an increase in the sense of
citizenship behavior and overall productivity of the company.

● Recognition (Employee of the Year):

WTC Pvt. Ltd. has a policy where they recognize the employee who has made the
most significant contributions during the fiscal year as “Employee of the Year”. As a
gesture of gratitude, the organization also awards Rs. 1,00,000 to employees who have
dedicated 10 years of service to the company. When asked if it is related to profit, we
were told that the "most significant contribution" isn’t just limited to who can bring more
profit to the company, as not all positions work is directly related to the profit of the
company. This will give the employees intrinsic motivation as they are being recognized
for their effort and hard work. It enables them to do better, reinforces their sense of
worth, and has definitely helped boost their confidence level regarding their job
performance.

● Sharing stock:
As per the question asked, we got to know that WTC Pvt. Ltd. is open to their
employees buying the stocks of the company. This has helped in having a sense of
ownership in the company, as now the sense of ownership has gone beyond just the
"employer-employee" relationship and as they understand that their individual
performance now directly impacts the value and performance of the company's stock as
well.

● Vacation:
While having informal talks with the employees, we found that WTC Pvt. Ltd.
provides vacations to their employees, allowing them to indulge in luxurious
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accommodations at reputed 4- or 5-star hotels. This will help the employees unwind and
enjoy their vacation without any work-related pressure or interruptions for a day or two.

● Performance Based Bonuses:

Web Trading Concern Pvt. Ltd. recognizes the importance of motivating and
rewarding its employees based on their performance. To achieve this, the company has
implemented a performance-based bonus system tied to individual, team, or company
targets. This system incentivizes employees to strive for excellence and achieve or
exceed goals, such as sales targets, customer satisfaction metrics, or cost-saving
initiatives. By linking bonuses directly to performance outcomes, employees are
encouraged to go the extra mile, collaborate effectively, and contribute to the overall
success of the organization. This performance-based bonus system not only recognizes
and rewards employees for their hard work and achievements but also fosters a culture of
continuous improvement and high performance. It serves as a powerful tool to motivate
and engage employees, driving them to deliver exceptional results and contribute to the
growth and success of Web Trading Concern Pvt. Ltd.

● Recreational activities:
Web Trading Concern Pvt. Ltd. has implemented a range of recreational activities
as part of its reward and compensation policies. Recognizing the importance of team
building and employee well-being, the company organizes various recreational events
and activities. These include sports tournaments, retreats, adventure outings, and wellness
programs. By incorporating these recreational elements, Web Trading Concern Pvt. Ltd.
aims to foster team bonding, improve collaboration, and cultivate a positive work culture
within its specialized areas of Diagnostics, Disinfection & Sterilization, Dermatology &
Aesthetic Care, and Medical & Critical Care. Through these initiatives, the company
encourages employees to engage in enjoyable activities that promote their physical and
mental well-being while fostering stronger relationships among team members.

● Overtime pay:
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Web Trading Concern Pvt. Ltd. recognizes the significance of overtime work and
has implemented a robust overtime reward and compensation policy. The company
ensures that employees who work beyond regular working hours are appropriately
compensated for their extra effort. A clear pre-approval process is in place, requiring
employees to obtain authorization before engaging in overtime work. Overtime hours are
accurately recorded, and the company adheres to applicable labor laws and regulations to
ensure compliance.The company also values and acknowledges the dedication and high
performance of employees during overtime work, offering recognition and rewards to
motivate and appreciate their commitment.

Overall, we can say that WTC Pvt. Ltd.'s policy on rewards and compensation has been
effective in increasing motivation and lowering turnover. They have proper communication and
every employee is well aware about the WTC’s reward and compensation policy.

2. Limitations of the reward and compensation policy in WTC Pvt. Ltd.

Based on the interview and the information gathered, even though there aren’t much
limitation in the reward and compensation policy in WTC Pvt. Ltd., below are some limitations
that have been identified:

● Even though the policy of employee of the year has been effective to date, it is found that
the employees who win the award keep repeating. It may affect the interpersonal
relationships among the employees as they may perceive it as favoritism, unfairness, etc.
● Following the point mentioned above, the time span being a whole year may affect the
performance quality.
● While overtime reward and compensation policies offer benefits, limitations include
increased labor costs, employee burnout, and potential impacts on work-life balance.
● Limiting stock purchases to only long-term employees of Web Trading Concern Pvt. Ltd
results in the exclusion of new employees, potential demotivation among ineligible staff,
inequality within the workforce, recruitment and retention challenges, limited employee
investment, and a lack of diversification among shareholders.
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3. Recommendation for rewards and compensation policy for WTC Pvt. Ltd.

Some of the recommendations for rewards and compensation policy for WTC Pvt. Ltd.
are listed down as follows:

● In order to avoid conflict over the title of the employee of the year, WTC Pvt. Ltd. should
introduce a more inclusive and diverse recognition system. It is recommended to
introduce different categories for recognition that will include different aspects of
employee performance.
● We also recommend WTC Pvt. Ltd. that the policy of the recognition may be more
effective if the time was shorter. They should consider implementing a policy based on a
half-year or quarter-based period instead. This may allow for more frequent recognition
and motivation among employees.
● To mitigate the limitations of overtime reward and compensation policies, we
recommend Web Trading Concern Pvt. Ltd. to monitor and manage overtime, encourage
work-life balance, and reconsider workload distribution.
● To overcome the restrictions of limiting stock purchases to long-term workers, we
recommend Web Trading Concern Pvt. Ltd. to broaden eligibility, implement vesting
periods, consider performance-based criteria, include new employee on the procedure of
purchasing stock which fosters inclusivity and increases employee engagement and
loyalty.