Question

provide five examples of compensation

Answer 1

Compensation:

The compensation is a system through which employees are paid in an organization in exchange of their work.

The below are the examples of compensation:

1. Base pay is a kind of compensation which is the initial salary paid to an employee excluding bonus, benefits, incentives etc. This base pay can be hourly, weekly, monthly or annual salary.

2. In addition to base salary a bonus is provided to the employees based on their performance and for the employees would have achieved their set target

3. Group incentive program is a compensative benefit program where an organization rewards its employees for their collective performance rather than individual performance. Financial rewards are shared when the specific objective of an organization is met.

4. Stock options are a way through which employees are given an option to buy or sell shares for a specific amount and specific period of time of their organization.

5. Benefits, every employee friendly organization does not only pay for work, but also look into some benefit packages which they can offer in order to motivate employees. Benefits would include life insurance premium pay-outs, medical insurance premium pay etc.