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Question : 31
Total: 39
Mahamana Enterprises is not only giving salary to its employees but it also offers bonus to them over and above the salary. To further encourage the employees, it announced that it will provide a share in the profits of the company to them. These incentives are helpful in increasing the purchasing power of the employees.
State four other incentives of the type of incentive discussed in the above para.
State four other incentives of the type of incentive discussed in the above para.
Solution:
The given case study refers to Financial Incentives: Financial incentives refer to incentives which are measurable in monetary terms and serve to motivate people for better performance. Bonus and Profit Sharing are mentioned in case study.
Types of Financial incentives:
(i) Pay and allowances: For every employee/ worker, salary is the basic monetary incentive. Regular increments in salary every year and grant of allowance act as good motivators.
(ii) Productivity linked wage incentives: In this, the payment of wages is determined on the basis of the goods produced. This is used for increasing productivity.
(iii) Co-partnership/Stock option: Under these incentive schemes, employees of the company are given an option to buy the company shares at a set price which is lower than market price.
(iv) Retirement Benefits: Retirement benefits are the benefits received either at the time of retirement or afterwards, such as provident fund, pension, and gratuity. These provide financial security to employees after their retirement.
(v) Perquisites: Perquisites are incidental payments, benefits, advantages over and above the regular income. In many companies perquisites are offered such as car allowance, housing, medical aid, and education to the children etc.
(vi) Commission: It is a common incentive offered to the employees working in sales department. It is directly linked to the efforts and the productivity of a employee.
Types of Financial incentives:
(i) Pay and allowances: For every employee/ worker, salary is the basic monetary incentive. Regular increments in salary every year and grant of allowance act as good motivators.
(ii) Productivity linked wage incentives: In this, the payment of wages is determined on the basis of the goods produced. This is used for increasing productivity.
(iii) Co-partnership/Stock option: Under these incentive schemes, employees of the company are given an option to buy the company shares at a set price which is lower than market price.
(iv) Retirement Benefits: Retirement benefits are the benefits received either at the time of retirement or afterwards, such as provident fund, pension, and gratuity. These provide financial security to employees after their retirement.
(v) Perquisites: Perquisites are incidental payments, benefits, advantages over and above the regular income. In many companies perquisites are offered such as car allowance, housing, medical aid, and education to the children etc.
(vi) Commission: It is a common incentive offered to the employees working in sales department. It is directly linked to the efforts and the productivity of a employee.
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