The key components to developing effective Reward Strategy is to ensure that there are clearly defined goals to meet business objectives, that the reward programme meets the needs of both the organisation and its employees, and to ensure that this is then supported by effective HR policies. In order to ensure these criteria are met there are a number of factors which influence how reward strategy is developed which include both internal factors within the organisation itself, as well as external factors outside the organisation.
1. The main External Factors are:
a. Political: the job market in the UK is split between Public sector ie Government and Private sector. Government policies have control of reward strategy within the Public
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i) National Minimum Wage, introduced by the Labour Party as part of the Maastrict Treaty 1992. The treaty had requirements for there to be a minimum standard of living for all citizens. The National Minimum Wage met this requirement. Is was highly criticised before being introduced , but did not have the negative impact on business as was suspected. This was partly due to the level being set fairly low upon introduction. There are set rates within 3 bandings according to age. ii) Equal Pay The Equality Act 2010, which encompasses the Equal Act 1970, made it unlawful to pay men and women differently if they were employed in :
• Like Work: the legislation defines that the work does not need to be identical but ‘ work of the same or broadly similar nature’. as demonstrated in the case of Capper Pass v Lawton (1977) where a sole female cook (Lawton), working 40 hours per week cooked for ten to twenty people per day, was deemed to be doing like work as two assistant male chefs, working 40 hours per week, but with 5 ½ hours over time paid and who were preparing three hundred and fifty meals per day. They were both paid more than Lawton. It was noted that the skills and experience were similar in both jobs – hence it was ‘like work’
• Work rated as Equivalent – where two different jobs have the same grading within a grading structure or when evaluated and when each component is broken down the jobs
The equal pay act requires employers to pay men and women equal pay for equal work. It prohibits sex discrimination between employees in respect of their contractual pay and terms and conditions of employment. This law covers all aspects of pay including benefits, childcare allowance, sickness benefits and car allowance. Before the act was brought into action the difference between the men and woman in pay was 37%. This act makes sure that men and woman that are doing the same job, equivalent job and jobs of an equal value are all paid equally. Alcarwash taking the Sex Discrimination act strictly means they must take the Equal Pay Act just as serious. Amongst their staff they must have an equality of pay if the staff members are doing the same job role; for example if a male car washer is earning around £6 an hour, where as a female car wash is earning £4- this will mean that Alcarwash are breaking the law and will most defiantly get prosecuted for it. So therefore when advertising and hiring I must offer the same amount of wage to a male and a female for applying for a job roll. This is law is very important, it is not right to differ people from each other and if this does occur within Alcarwash, the business will be prosecuted and then the business
5.1 The purpose of the Equal Pay Act 1970 is to eliminate discrimination between men and women in terms of pay. One reason that justifies treating employees fairly in relation to pay is that lower earnings make it harder for women to take care of their families. A report from the Institute for Women’s Policy Research found that if women were paid fairly, single women’s income would rise by 13.4%, single mothers would earn
The Equal Pay Act passed in 1963 it is apart of the Fair Labor Standards Act and it states that both genders should be paid the same amount of income for the same work being done (History.com Staff 2017). In the Equal Pay Act it states that within the same establishment or enterprise if the work being done has the same skills, effort, and responsibility then whoever has that job must be paid equal to one
Equal Opportunities legislation sets out that all employees should receive the same pay and conditions for carrying out the same or approximately similar work.
There is also evidence to women being much less likely to become a manager as there are only 32.2% (Allen, 2015) of senior and middle-level managers who are women in 2012 which indicates a ‘glass-ceiling’ that adds to the difference in pay between men and women. Becker’s taste discrimination model is therefore an explanation of the magnitude of the gender pay gap in the UK and it has high explanatory power. This is due to there being a large amount of evidence to support there being an aversion to hiring women and preference of hiring men over women.
The Equal Pay Act 1970 is an Act of the United Kingdom Parliament which prohibits any less favourable treatment between men and women in terms of pay and conditions of employment. It was passed by Parliament in the aftermath of the 1968 Ford sewing machinists strike[1][2][3][4] and came into force on 29 December 1975. The term pay is interpreted in a broad sense to include, on top of wages, things like holidays, pension rights, company perks and some kinds of bonuses. The legislation has been amended on a number of recent occasions to incorporate a simplified approach under European Union law that is common to all member states.
The first advantage of a total rewards approach is self fulfillment so that people are recognized for what they do and encouraged to reach their potential through effective learning and development processes and given feedback on their performance. The second advantage is an organization culture where roles are clear and organizational and personal values are in alignment so that employees engage and enjoy work. Another way to consider the necessary components of rewarding people is to view them as individuals, within their team, in the organization and generally in the workplace. The fourth advantage is recognition, you must make sure that the employees
Chapter 43.2 Under the Equal Pay Act Equal work is defined as paying both gender employees’, male and female, the same/equal amount of pay in terms of skills, efforts, responsibility and working conditions.
The Equal Pay Act and its subsequent amendments provide for members of one sex to claim equal pay with a member of the opposite sex who is doing like work, or work of a different nature which can be shown to be similar in terms of the requirements for skill and effort , that is work of equal value. The Equal Pay Act is dealt with in more detail in Chapter 11, which examines payment systems and the evaluation systems and the evaluation jobs. The major points to be made here is that it would be unlawful to advertise different pay rates for men and women doing the same work, or to offer employees of one sex disadvantageous terms and conditions.
The legal side of comparable worth, however, is much less clear. As a legal thought, comparable worth is growing through a high number of court cases, appeals, reversals, affirmations, and administrative rulings dealing with related wage inequality issues, but not comparable worth. There is also the questions regarding issues surrounding comparable worth, such as "equal pay for equal work," "equal pay for similar work," and "pay parity," which although sounding similar are quite different from comparable worth. With the "equal pay for equal work," if the jobs do not differ from one another in terms of skill, effort, responsibility, and working conditions, they are seen as being equal. Using such criteria, workers having equal jobs are required by the Equal Pay Act of 1963 to be compensated equally in terms of wages, salaries, benefits, etc. Exceptions to equal pay may, however, be based on such things as seniority, merit pay, and productivity. Thee exceptions, however, must be gender neutral. There is nearly no social, political, economic, or legal conflicts over equal pay for equal
A minimum wage (MW) is a legally enforced minimum hourly wage (GOV.UK, 2016). It is used by developed countries to reduce poverty and minimise income inequality. The UK introduced the National Minimum Wage (NMW) in 1999, uprating it in subsequent years. The National Living Wage (NLW), announced in July 2015, is a new UK wage law, replacing the NMW for those aged 25 or over, and not in their first year of an apprenticeship. (GOV.UK, 2015). Coming into effect in April 2016, at a rate of £7.20 per hour, it will have a direct affect on approximately 2.7 million workers. It is the largest nominal wage
In the post WWII period employment patterns are characterised by clear career progression paths while employees are likely to stay within the same company their whole working lives. While in contemporary times employees may move between companies changing jobs, possibly changing locations numerous times, due to lack of progression prospects. Sennett describes this as due to changes in organisational structures which make employees jobs project based little in the form of ‘linear progression’ in terms of promotion. In this system employees are seen as more dispensable pieces of organisational projects rather than a direct part of the company. As Beck (2000) states this system aims towards maximising organisational flexibility. However as Beck states (p. 3) this places workers in the heart of a system of ‘endemic’ and ‘incalculable risk’. The effects of this are apparent interviews conducted by William S. Brown (2005) on final year students at a business school. When the subjects were asked if contemporary working patterns made them feel ‘at risk’ the majority of respondents answered yes. This is a market in which employees are increasingly open to change jobs and where employers are more likely to remove an individual from the company. This means employees are individuals are unable to plan for their future due to an inability to assume both working positions and
The total reward approach emphasize the most important of considering all features of rewards as an integrated whole. Each element of total reward base on the contingent of performance competence or contribution employee benefits and non-financial rewards which involves intrinsic rewards from the employment environment and the work are linked.
Reward success. Attach compensation or other rewards to the achievement of the goals set by the team and team leaders. Give company wide recognition to individuals and teams, for performance achievements.
Treating employees fairly in relations to pay is important for both employee and employer. The Equal Pay Act 1970 was introduced to ensure that women and men are paid the same for the same role. Organisations that actively treat all employees the same in relation to pay promote retention of employees. Employees won’t be underpaid for the work they do in relation to a colleague in a similar role, employees won’t feel discriminated against thus performance of work isn’t effected. The