Question

notes this subject is ( HRM ) master degree

1 a. Explain say on pay, golden parachutes, and clawback policies and give an appropriate example for each

b. Discuss the current issues regarding employee compensation In Malaysia. Based on the issues, discuss your opinion on whether the salary offered to the employer is underpaid or overpaid?

Answer 1

1. Say on pay is basically the term which is used for describing a role in corporate law where a firm's shareholders holds the right to vote on and about thr remuneration of the executives of the same firm.
For example: if the demand and supply is meeting at an equivalent point making that a salary of an executive should be more than what he/she is getting paid, then certainly the salary would increase.

A golden parachute refers to a large payment or any other financial compensation which is guaranteed to a firm's executive if they will be dismissed as a result lr any takeover or mergers happening in the future or present.

Example: If a company is going through a merger there might be areas where employees would be more but job position would be limited. Thus, the executives of each company gets a written contract stating if they would lose their job because of the merger, a compensation amount would be paid to them.

Clawback refers to a contractual provision where money paid to the employee should be returned back to the employer with a penalty because of any situation.

For example, if an employee is found doing unethical practices, employers often ask them to return the amount given to them as a bonus with a fine.

2. There are a lot of compensation issues going in Malaysia where the employer id getting underpaid because of the financial health of the country as well as the low skilled workers. Many retail, manufacturing and food based sector, workers have a low bargaining power because they lack the skills making them being underpaid for the same job they perform comparative to high paying employees in other countries.