Wages Differential

Wages Differential
Human Resource Management

Group Members
Husnain Attique 2161082

Shahzaib Shahid 2163133
CONTENTS
 Summary
 Introduction (wages, wages administration)
 Wages differentials
 Occupational wages
 Skills based wages
 Wages by coca cola company
• HRM Policies
 Conclusion
 Reference
Description
 The title of this project is “Wage Differentials -
occupational vs. skills - an overview”. The objective of
the study is to analyze the Wages administration and its
differentials between occupational wise and skills wise in
the company.
 The study has been conducted to know the wages and
salary structure provided by the company to its
employees.
 In this project, I studied about the present wages and
salary compensation of COCA-COLA company Pvt. Ltd.
along with the evaluation of the incentives, bonus, and
allowances given to the employees.
OBJECTIVE
 The aim of this study/project is analyze, investigate and observe the ‘how
the wages differentails the important factor of organization or a company
like its
 Control cost
 Productivity
 Present Employees
 Efficiency
 And its relationship between them.
Wages Differentials
Define
Purpose
Cause
Factors
Principles
Purpose
 Levels of responsibilities
 Mental and physical exertion
 Enabled full employment/utilization of resources.
 Facilitate the economic growth.
 To induce employees to learn and acquire new skills
 To shift employees a new industry
 To motivate employees to accept more responsible jobs/positions
 To undertake economic and social welfare activities.
Cause
 Ignorance on the part of employers and employees as to the

prevailing wage rates
 Due to different systems of payment.
 Due to payment of overtimes, vacations, statutory holidays.
 Relative bargaining powers of employers and employees.
 Due to different systems of payment.
Factors
 Demand and supply position of workers in the labor market.

 Comparative wages paid by same industries in the same region.
 Difference in productivity of labor
 Ability of the firm to pay its workers.
 Government policies on minimum wages.
Occupational wages differentials
 Occupations in an organization widely differ from one another in terms of

skill requirement and the extent of requirement and the extent of
responsibility. Accordingly, wages vary from occupation.
 Such differences in occupations induce people/workers to undertake more
challenging jobs, encourage workers to develop their skills by way of
education and training.
 It is varying skill requirement for different occupational that shapes the
manpower planning in an organization-be it an industrial organization or
educational institution.
Functions
 To provide an incentive to young person to incur the costs of training and

education and encourage workers to develop skills in anticipation of higher
earnings in future.
 To perform a social function by way of determining the social status of
workers.
Skills Based Wages
 A wage differential refers to the difference in wages between

people with similar skills within differing localities or industries. It can
also refer to the difference in wages between employees who have
dissimilar skills within the same industry.
 Skilled worker on average earn more than unskilled workers. such
differentials are necessary to motivate large population in
developing countries to acquire skills for industrialization and
economic growth.
Occupational vs skills
 In countries adopting a course of planned economic development,

skill differentials play an important role in manpower and
employment programmers, for they considerably help in bringing
about an adequate supply of labor with skills corresponding to the
requirements of product plans.
Wages differentials
Wages Policies
 Coca-Cola is providing smart wages to its employees, which are

competitive and really satisfactory. With wages lot of facilities and
amenities are provided according to the policy. Structure of wages can be
described as:
 Blue collar workers are offered wages along with commission, salesman are
offered wages plus commission pursuing certain criteria.
 White collar workers who are the officers and the executives draw a
handsome amount salary with incentives.
Compensation Policy
 Basic salary
 Bonus
 Medical facility
 Pick and drop
 Gratuity fund
 Social security
Insurance Policy
 Employee health insurance companies typically cover medical benefits for

insured (self), spouse, children and dependent parents
 Some health insurance providers cover pre- existing illness and maternity as
well
 Employee health insurance offers cashless hospitalization at network
hospitals
 Group health insurance can cover ancillary charges such as ambulance
costs too.
 Some employee health insurance policies provide fee reimbursements of
specialists and other medical practitioners for follow checkups
Conclusion
 The wage differentials in Pakistan tend to be higher in rural as compared

with urban areas, and are higher among women than among men. The
wage differential also tends to be higher for low-skilled workers.
 There is considerable evidence of an increase in the wage differential
between 1997-99 and 2010-2015. Wage differentials are the result of
occupational differentials, inter-firm differentials, regional differentials, inter-
industry differentials and personal differentials.

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Wages Differential

Human Resource Management

Husnain Attique 2161082

 Ignorance on the part of employers and employees as to the

 Demand and supply position of workers in the labor market.

 Occupations in an organization widely differ from one another in terms of

 To provide an incentive to young person to incur the costs of training and

 A wage differential refers to the difference in wages between

 In countries adopting a course of planned economic development,

 Coca-Cola is providing smart wages to its employees, which are

 Employee health insurance companies typically cover medical benefits for

 The wage differentials in Pakistan tend to be higher in rural as compared

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