Compensation System

A compensation system refers to the structured approach that organizations use to determine how to pay their employees. It includes salaries, bonuses, benefits, and other types of rewards offered for work performed. This system is designed to attract, retain, and motivate employees, ensuring fairness and competitiveness in the job market. It considers factors like job responsibilities, market rates, individual performance, and company resources. A well-designed compensation system aligns employee efforts with organizational goals, fostering a productive and satisfied workforce.