HUMAN RESOURCE

MANAGEMENT

Compensation Management
 It deals with every type of reward individuals
receive in exchange for performing organizational
tasks

 Employees trade labor & loyalty for financial &

non-financial compensation (pay, benefits,
services, recognition, etc.)

 Non-financial rewards like praise, self-esteem &

recognition, affect employees' motivation,
productivity, satisfaction
 Workers exchange work for rewards. Probably the
important reward, and certainly the most obvious, is
money
 Organizations generally seek to pay the least that
they have to in order to minimize costs. Workers also
want fair compensation
 Government policies set minimum wages and benefits
that employers must meet, and these policies provide
protection for certain groups
 Apart from this, compensation administration policies
depend upon condition of labour market, trade union
influences, internal factors such as attitudes of top
management
 Compensation administration seeks to design the
lowest-cost pay structure that will not only attract,
motivate and retain competent employees but also
be perceived as fair by these employees
 Trend changing in compensation management from
seniority based to performance based
 Compensation structure should be reviewed from
time to time to adapt to changes in the
environment and cost of living
 “Compensation refers to all forms of
financial returns, tangible services,
and benefits employees receive as
part of an employment relationship”

Milkovich
Forms of Compensation
 Wages and salary
 Wage: Remuneration paid periodically to a worker.
It is usually the hourly rate paid to blue collar
workers
 Salary: Weekly or monthly rates paid to white-
collar workers
 Incentives: Extra pay for extra performance in
addition to regular salary & wages. It is based on
performance
 Employee benefits: Usually known as “fringe
benefits”. They are supplements to wages received by
employees. E.g. insurance, paid vacations, and
holidays, pension & telephone, etc.
 Services and Perquisites (privileges): related with
quality of work life of the employees such as car,
housing loans, reimbursement of the children’s
education costs, discounts on company products,
recreation, etc.
Intrinsic Rewards
 Intrinsic Rewards
 Personal Satisfaction
 Comes from the job itself
 Pride in one's work, feelings of accomplishment,
being part of a work team, interesting work,
responsibility, job freedom, growth opportunity,
participation, etc.
 Extrinsic Rewards
 Comes from a source outside the job, offered
mainly by management
 Includes rewards, promotions, benefits
 Within Extrinsic Rewards:
 Financial and Non-financial Rewards
 Performance Based and Membership Based
 Direct Compensation and Indirect
Compensation
 Direct Compensation
 Consists of pay an employee receives in the form of
wages, salaries, bonuses or commissions
 Indirect Compensation
 Benefits consist of all financial rewards that are not
included in direct financial compensation
 E.g. vacation, insurance, child care, etc
Financial Compensation
Direct, Indirect

Direct Financial Indirect Financial

Compensation Compensation
 Consists of pay an  Benefits consist of
employee receives all financial rewards
in the form of that are not
wages, salaries, included in direct
bonuses or financial
commissions compensation
 E.g. vacation,
insurance, child
care, etc.
Purpose
 To attract potential job applicants by providing
sufficient compensation
 To retain qualified and competent employees by
paying them more than what competitors are
paying for similar positions
 To motivate employees by compensating on the
basis of their performance
 To administer pay within legal regulations for
avoiding any sort of legal violation
 To help in achieving organizational strategic
objectives by enhancing innovation & quality
 Effective Compensation Policy should be:
 Adequate
 Equitable
 Balanced
 Cost-effective
 Secure
 Incentive providing
 Acceptable to the employee
Establishing Pay rates
 Conduct a salary survey of what other employers
are paying for comparable jobs
 Determine the worth of each job in your
organization through job evaluation
 Group similar jobs into pay grades
 Price each pay grades by using wave curves
 Fine tune pay rates
Salary Survey
 Salary surveys are used to price benchmark jobs
 Employers typically price 20% or more of their
positions directly in the marketplace
 Surveys also collect data on benefits like
insurance, sick leave and vacations to provide a
basis for decisions regarding employee benefits
 Every employer conducts at least an informal
telephone, newspaper or internet salary survey
Job Evaluation
 A systematic comparison done in order to determine
the worth of one job relative to another
 Job evaluation is a process whereby an organization
systematically establishes its compensation program
 Aims to determine a job’s relative worth
 Intuitive approach and Comparison of jobs by
focusing on compensable factors
 Job evaluation is a judgmental process and requires
close co-operation
 Compensable factors are the fundamental,
compensable element of a job such as skills, effort,
responsibility and working condition
Job Evaluation Process
 Identifying the need for job evaluation
 Getting the employees to co-operate
 Choosing a job evaluation committee
 Committee identifies benchmark jobs
 Then selects compensable factors
 Evaluating worth of each job
 Methods for
Evaluating
Jobs

Job
Point Factor
Ranking Classificatio
Method Comparison
n
Job Evaluation Methods
 Ranking Method
 Requires a committee composed of both
management & employee representatives to
arrange jobs in a simple rank order, from highest to
lowest
 Involves ranking each job relative to all other jobs,
usually based on overall difficulty
 First 2 jobs are compared, then they are compared
with another job until all the jobs have been
evaluated & ranked
 Ranking each job relative to all other jobs, usually
based on some overall factor
 Steps in job ranking:
1. Obtain job information
2. Select and group jobs
3. Select compensable factors
4. Rank jobs
5. Combine ratings
 Simple and economical to use
 Difficult to use if no. of employees is large
 Subjectivity of the method, no standards to
justify the ranking
Example of a Job Ranking Method

Ranking order of the jobs Monthly pay scale

Manager Rs. 25, 000

Supervisor Rs. 15, 000
Foreman Rs. 10, 000
Machine operator Rs. 5,000
 Job Classification
 Job are categorized in different class or grades for
different jobs requiring similar skills, efforts,
difficulty and responsibility
 Raters categorize jobs into groups or classes of jobs
that are of roughly the same value for pay purposes
 Classes contain similar jobs e.g. Administrative
assistant
 Grades are jobs similar in difficulty but otherwise
different e.g. Mechanics, welders, electricians, and
machinists
 Jobs are classed by the amount or level of
compensable factors they contain
 There are several ways to categorize jobs:
 Write-up class or grade descriptions (similar to job
descriptions) and place jobs into classes or grades
based on how well they fit these descriptions
 Draw up a set of guidelines for each class (for
instance, how much independent judgment, skill,
physical effort, and so on, does the class of jobs
require?). Then categorize the jobs according to
these rules
 It is simple, easy to use for large number of jobs and
has one rating scale
 Difficult to write the class or grade descriptions
(ambiguous)
 Example of a Grade Level Definition

This is a summary chart of the key grade level criteria for the GS-7 level of clerical and
assistance work. Do not use this chart alone for classification purposes; additional
grade level criteria are in the Web-based chart.

Source: www.opm.gov/fedclass/gscler.pdf. Accessed

May 18, 2007.
 Point Method
 The point method is more quantitative, most widely
used method
 Identifies compensable factors
 Compensable factors necessary for successful
completion of the job is determined like
responsibility, skills, mental efforts, physical efforts,
working condition
 Factors are evaluated in a scale and points are given
to each factors
 Total points are calculated and each job is evaluated
according to the points and pay scale is determined
 Is more specific and has larger numbers of factors
 Has more precise measurements
 Is a time consuming process
 Is more difficult to understand
Figure: Point System Matrix
Level (Degrees)
Compensable Factors Minimum Low Moderate High
1 2 3 4
Responsibility
I) equipment process 5 10 15 20
5 10 15 20
II) material/product 5 10 15 20
III) safety of others 5 10 15 20
IV) work of others

Skill
I) education 14 28 42 56
II) experience 22 44 66 88
III) knowledge 14 28 42 56
Effort
I) physical 10 20 30 40
II) mental 5 10 15 20
Job Condition
I) working conditions 10 20 30 40
II) hazards 5 10 15 20
Total points 1000 100 200 300 400
 Factor Comparison
 The factor comparison method entails deciding
which jobs have more of the chosen compensable
factors
 The method is actually a refinement of the ranking
method
 With the ranking method, you generally look at
each job as an entity and rank the jobs on some
overall factor like job difficulty
 With the factor comparison method, you rank each
job several times—once for each of several
compensable factors
 Compensable factors that can be applied to each
jobs is identified like responsibility, skills, mental
and physical effort, working condition
 According to the difficulty and complexity of task
related with each factor certain amount is given
and the total amount in each job is calculated as
wage rate
 Is More accurate, systematic and quantifiable than
previous methods; Easy to understand
 Is Complex and difficult to operate; Difficult to identify
compensable factors
Determination of Wage Rate of a Machinist under Factor
Comparison Method

Rs
Factors for comparison
Responsibility 12
Skills 16
Mental efforts 12
Physical efforts 6
Working conditions 4
Total wage per hour 50
 Group similar jobs into pay grades
 A pay grade is comprised of jobs of
approximately equal difficulty
 Committee groups similar jobs into grades for
pay purposes
 Price Each pay grade – wage curves
 Assigning pay rates to pay grades
 Wage curve shows the relationship between the
value of the job and the average wage paid for
this job
 Fine tune Pay rates
1. Developing pay ranges
 A series of steps or levels within a pay grade
usually based upon years of service
 Pay ranges often show minimum,maximum and
midpoint pay rates for the grade
 It lets employer take more flexible stance in the
labour market
 It also let companies provide for performance
differences between employees within same
grade or with different senioritiess
2. Correcting out-of-line rates
 Wage rate for particular job may fall well off the
curve indicating average pay for the job is
currently too high or too low
 Correcting such outliers by way or increasing the
underpaid or freezing the rate and promoting or
transfering the overpaid jobs
Incentives
 F.W. Taylor introduced the system of incentive for
those whose production exceeded some
predetermined standards
 Incentives are paid in addition to wages & salaries.
Incentives depend upon productivity, sales, profit
or cost reduction efforts
 Organizations that are sincerely committed to
developing a compensation system that is designed
around performance will want to consider the use of
incentive pay
 This is the method of rewarding employees on the
basis of their outputs
 An incentive plan may consist of both 'monetary' &
'non-monetary' element.
 The timing, accuracy & frequency of incentives are
the very basis of a successful incentive plans
 It should be properly communicated to the
employees to encourage individual performance,
provide feedback & encourage redirection
Individual Employee Incentives
 Piecework Plans
 A system of pay based on the number of items
processed by each individual worker in a unit of time,
such as items per hour or items per day
 First incentive plan introduced by F. W. Taylor
 Employee receives a fixed wage for each unit produced
 The piece rate has the advantage of establishing a direct
relation between what an employee produces & what is
earned
 for example, a minimal hourly rate for meeting some
pre-established standard output. For output beyond that
standard, the worker earns so much for that extra
output
 Straight piecework - An incentive plan in which
person is paid a sum for each item he or she
makes or sells, with a strict proportionality
between results and rewards
 The employee is typically guaranteed a minimal
hourly rate for meeting some pre-established
standard output
 Standard hour plans is a piecework plan except
that an employee is paid a basic hourly rate but
is paid an extra percentage of his base rate for
production exceeding the standard hour or day
 Merit Pay or Performance Increments
 Any salary increase the firm awards to an
individual employee based on his or her
individual performance
 Incentives for Sales People
 They get an amount that represents a
percentage of the sales price
 Sales personnel frequently work on commission
basis
 Many companies pay salespeople a combination
of salary and commissions
 Incentives for Managers and Executives
 Managers are given annual bonuses aimed at
motivating managers’ short term performance
 Managers are also provided some incentives in
forms of stock option & performance shares of
their performance increases the profitability &
market shares of the company
 A stock option is the right to purchase a specific
number of shares of company stock at a specific
price during a specific period
Team Incentive Plans
 A plan in which a production standard is set for
specific work group and its members are paid
incentives if the group exceeds the production
standards
 Team or group incentive plans pay incentives to the
team based on the team’s performance
 They make the most sense where employees' tasks
are interdependent & thus require cooperation E.g.
the conditions that exist in an automobile assembly
line
 Production targets are set as standards of
performance for a group of employees
 If the employees in the group perform better or more
than the standards, all members of the group receive
incentives
 Production Incentive Program
 Many groups in the manufacturing plants work
as bonus groups under production programs
 Members of these groups receive regular pay &
bonus is tied with the level of performance &
profit
 Department Head Incentive Plan
 Based on the division or department, incentives
given to the department heads
 These incentives later on are shared among the
employees of the same department or division
Problems with Team Incentives
 Employees do not see them as being directly linked to
their own behavior. The pay of the employee under
group incentives is influenced by the behavior of
others with whom that employee works
 Another problem is the self-deception phenomenon.
People claim more responsibility for their group's
successful performance than they would if the group
failed
 When the group performs well, most people present
themselves as contributing more than other members
to the group's success. This suggests that group
members expect greater than average rewards when
their group does well, creating internal conflicts
Organization wide Incentive
Plans
 Incentive plans in which all or most employees
can participate
 Useful to motivate all employees to work for
organizational effectiveness
 These incentive plans are offered to encourage a
high level of cooperation among the employees
 The goal of organization wide incentive is to
direct the efforts of all employees toward
achieving overall organizational effectiveness
 Profit-sharing Plan
 A plan to distribute a portion of the profits of the
organization to employees
 Incentive is provided to all employees working in the
organization allocated on the basis of profit
 It includes both cash plans and wage dividend plans
 Cash Plans include sharing profit at the rate of certain
percentage (10-25% depending upon management
board decision or guided by the Act) amount the
employees
 Wage Dividend Plans: A certain percentage of profit is
distributed among the employees in terms of
dividends
 Advantages of Profit Sharing
 Profit Sharing increases workers' motivation,
commitment, participation & partnership
 You are more likely to be cost-conscious if you share in
the benefits
 Disadvantages of Profit Sharing
 Employees often find it difficult to relate their efforts to
the profit-sharing bonus. Their individual impact on the
organization's profitability is usually miniscule
 Outside factors such as economic conditions & actions
of competitors which are outside the control of the
employees may have a far greater impact on the
company's profitability than any actions of the
employees themselves
 The Scanlon Plan
 Developed by Joseph Scanlon in 1937
 Is offered to enhance management-employee
relations company-wide
 co-operation between employees enhancing
participation & sharing of benefits
 Suggestions from employees will be considered & a
formula will be developed to distribute benefits
between employers & workers
 The philosophy of cooperation between workers &
management through sharing of problems, goals &
ideas
 A feeling of ownership will be developed
 Management and employee work together for labor
saving improvements or cost cutting programs
through sharing problems, goals, and ideas
 The benefit is then shared between employees
through bonus
 The amount of bonus is determined on the basis of
savings in labor costs
 Employees understand the business’s mission and
how it operates in terms of customers, prices, and
costs
 The plan depends a high level of competence from
employees at all levels
 Based on the principle of involvement
 Under Scanlon, each department in the
organization has a committee composed of the
supervisor & employee representatives
 Suggestions for labor-saving improvements are
focused in the committee and, if accepted, cost
savings & productivity gains are shared by all
employees, not just the individuals who made
the suggestion
 Gain-sharing
 Was developed on the assumption that it is possible
to reduce costs by eliminating wasted material & labor
with the improvement of new & better
products/services
 This will increase in productivity
 Any saving from improvement in productivity is
regarded as gain to be distributed among employees.
Employees divide productivity-generated savings
among workers & employers
 Gain sharing is the sharing with the employees a
greater-than-expected gains in profits and/or
productivity
 Employees Stock Ownership Plans (ESOPs)
 Refers to a plan whereby employees gain stock
ownership in the organization for which they work
 Employees can have stock ownership of the
organization for which they work, thereby increasing
their commitment, loyalty & effort
 Employees are assigned shares of company stock,
kept in the trust, based on length of service & pay
level
 On retirement or death or separation from the
organization, employees or their beneficiaries can sell
the stock back to the trust or on the open market, if
the stock is publicly traded
 All the organization wide incentives suffer from a
dilution effect. It is hard for employees to see how
their efforts result in the organization's overall
performance
 These plans also tend to distribute their payoffs at
wide intervals, thus loses a lot of reinforcement
capabilities
 When organization wide incentives become large &
recurrent, it is not unusual for the employee to
begin to anticipate & expect the bonus. As such
bonus loses some of its motivating properties, for it
becomes perceived as a membership-based reward
 A high level of co-operation between
management & employees require for the free
flow of communication, active participation &
interactions of views & ideas
Employee Benefits and Services
 Indirect financial and non financial payments
employees receive for continuing their
employment with the company
 Benefits and services do not necessarily
motivate employees because they tend to be
offered to all workers and are not contingent
on performance
 A good benefits package is, in some cases, a
primary reason why some job seekers choose
certain organizations. E.g.: Civil servants,
police or army, etc.
 Examples of important benefit plans

Legally Required Voluntary Benefits Services

Benefits
1. Social security 1. Pay for rest period. 1. Social or
2. Unemployment 2. Pay for holidays. recreational events.
compensation 3. Pay for vacations. 2. Counselling.
3. Worker's 4. Pay for sick leaves. 3. Cultural activities.
compensation 5. Pay for leaves of 4. Credit unions.
4. Disability plans absence. 5. Housing.
6. Pension programs. 6. Discounts on
In Nepal's case: 7. Accidental purchases.
Also, old age insurance. 7. Tuition refunds for
compensation 8. Life insurance. educational
9. Health insurance. courses.
Retirement Programs
 Retirement is a difficult experience
 To help ease the retirement, many organizations
adopt programs for assistance (retirement benefits)
for the potential or actual retirees
 Many companies also encourage early retirement
so there is no reason to wait until a person is ready
to retire to provide retirement planning assistance
 Various types of retirement could be:
 Age bound retirement/mandatory retirement
 Project phase-out retirement
 Voluntary retirement
 Compulsory Retirement: Retires after completing
specified year of service or age. E.g. 65 years old
 Forced Retirement: Employees are forced to retire
after completing a specified year of service. E.g. after
completing 30 year of service
 Voluntary Retirement: The employees are encouraged
to retire early before attaining the legal age of
retirement or years of service. It is generally
accompanied with a golden handshake consisting of
attractive cash payment in addition to retirement
benefit
 Phased Retirement: They are given to work half time
beyond normal retirement age before retiring.
 Provident fund
 Provident fund is a contributory old age benefit under
the labor law
 According to the provision, the employer should
deduct 10 percent of basic salary of the employees
and add 10 percent to it, and deposit the amount in
any commercial banks or Karmachari Sanchaya
Kosh, the autonomous provident fund authority in
Nepal.
 Gratuity
 Gratuity is also part of an old age benefit.
 It is also known as a severance pay (disconnection)
 .
 As per the provision of the Labor Rules, the
employees serving for three years or more and
retiring from the service are entitled to get gratuity
 Social Security: It is state program that provides
three types of benefits
 There is no comprehensive social security system
under the Nepali labor law
 Employees are entitled to receive following benefits
as part of social security under the Labor Act and
Rules:
1. Retirement Income
2. Death benefits to employee dependents regardless of
age at the time of death
 In case of death of an employee instantly or in the
course of treatment as a result of an accident while
on duty, the employer should pay an amount
equivalent to three years' salary calculated at the last
drawn salary rate to the nearest heir as compensation
 However, in case an employee dies or becomes
physically disabled as a result of a natural calamity,
the employee or his/her legal heir shall not be entitled
to any compensation

 Disability benefits payable to disabled employees and

their dependents
 If an employee is physically disabled as a result of
3. Disability benefits payable to disabled employees and
their dependents
 If an employee is physically disabled as a result of an
accident while on duty, the employer must pay a lump
sum amount equivalent to the salary of five years of
the last drawn salary in case of complete disability
 In case of partial disability, the amount of
compensation shall be calculated according to the
percentage of disability.
Pension Plans
 Provided by employers to supplement the employee’s
social security benefits
 Defined Benefit Plan:
 The benefits that a worker will receive at retirement are
well specified
 Employees know ahead of time the pension benefits they
will receive
 The amount typically resolves around some fixed
monthly income for life (on a variation of a lump-sum
cash distribution)
 The company contributes the set amount every year into
a trust fund
 Defined contribution plan:
 Specify what contribution the employee & employer
will make to the employee’s retirement or savings
fund
 The employee will know what his retirement benefits
will be upon retirement
 Under a defined contribution plan, each employee
has an individual account, to which both the
employee & employer may make contributions.
 The plan establishes rules for contributions.
 This has made defined contribution plans a popular
trend in new qualified retirement planning.
Executive Compensation
 Executive compensation is higher than that of rank-
and file personnel
 Also includes other financial and non-financial benefits
not otherwise available to operative employees
 This is because:
 Basic salary of executives is higher than those of
lower level managers
 Executives frequently operate under bonus and
stock option plans that can dramatically increase
their total compensation
 Executives receive perquisites (special benefits)
that others do not
 Compensation in Nepal
GOVERNMENT REGULATIONS

 Government plays an important role in regulating compensation in most countries,

including Nepal. The tools for compensation regulation are:
a) Legal Framework 
Labour Act 1992
 Lays down the legal framework and the basis for the rules, regulations and guidance
on the proper management of any establishment employing 10 persons or more

 It deals with matters relating to employment and security of employment, working

hours and minimum wages, welfare of employees, employer employee relations and
the settlement of labour disputes

 According to the Labour Act 1992, no child under the age of 14 shall be engaged in
any enterprises

 Minors - those who have attained the age of 14 but have not completed the age of
18 - and females may be engaged in work from 0600 to 1800 hours

 Salaries should be established on the basis of skill, responsibility, effort, and

working conditions without any discrimination between male and female workers
Labour Regulation 1993
 Complements the Labour Act with further clarification on issues
such as security of profession and service, remuneration and
welfare provisions, health, cleanliness and safety, etc.

 In Nepal, legal provisions provide 10 percent contribution of gross

salary for both workers and employers to employee provident fund

Bonus Act 1974, as amended subsequently,

 Provides a legal basis for the payment of bonus to the workers and
employers of factories and commercial establishments

 In Nepal, it is specified 10 percent of net profit as the limit for

bonus payment
 
The Company Act 1996
 Regulates salary of executives
 In Nepal, it limits reward to 5 percent of net profit to company
directors
The Civil Service Act
 Provides facilities such as pay and allowance;
 Provides medical expenses (for gazette staff, 12 months salary; For non-
gazette staff, 18 months salary; For classless staff, 21 months salary);
 pension or gratuity on retirement for the employees;
 disability allowance;
 one month salary for Dashain;
 life insurance coverage (For gazette staff, Rs. 2,00,000; For non-gazette
staff, Rs. 1,00,000);
 pension or gratuity for family in case of employee death;
 payment for accumulated leave;
 10 percent salary for provident fund;
 health insurance and travel insurance, etc.

 On 7 March 2005, the Nepali Parliament passed the Child Labor Prohibition
and Control Act by a majority. The Act prohibits the use of child labor in
hazardous working conditions like that in factories and mines and establishes
their right to education.

 Others: Nepal has also ratified I-L-O Conventions No. 98 (Right to Organize
and Collective Bargaining), No. 138 (Minimum Age Convention), No. 182
(Elimination of Worst Forms of Child Labour), and No. 29 (Forced Labour).
b) Institutional Framework

 Wage Boards are one of the regulatory

institutions for compensation. In Nepal, wage
committee formed by the government fixes
minimum wages of labour and tea plantation
workers

 Tribunals provide verdict of adjudication in case

of wage disputes. Nepal does have a separate
Labour Court.

 The Department of Labour is the government

agency responsible for implementation of legal
framework related to compensation
 MINIMUM WAGES

 On 25 April 2000, the Nepal government revised

the minimum wages for laborers and employees
working in institutions other than the tea industries

 The wages payable to workers in Nepal are

comparatively low

 The minimum wage rates set by the government

and published in the Nepal Gazette are generally
lower than the going wage rates for workers

 Wages once negotiated, generally, need not to be

changed for two years
Unskilled S-skilled Skilled H-Skilled Minors
Rs. 1,480 per Rs. 1,500 per Rs. 1,610 per Rs. 1,800 Rs. 1,144
month month month per month per month

Plus additional dearness allowance of Rs. 666 for adults and Rs. 500 for children
The previous amount set in 1997 before the Act was amended stood at:
Rs. 1,300 per Rs. 1,350 per Rs. 1,460 per Rs. 1,660 per Rs. 1,025
month month month month per month

Plus additional dearness allowance of Rs. 500 for adults and Rs. 375 for minors.

If working on a daily basis:

Adult Minors
Rs. 74/- Rs. 60/-
The previous amount set in 1997 before the Act was amended stood at:
Rs. 63/- Rs. 50/-

If working on a daily basis:

In case of agriculture workers:
Rs. 60 per day @ Rs. 7.50 per hour.
Current Minimum Wages
 On 1 February 2016, Nepal Government revised the
minimum wages for laborers & employees working in
industries other than tea industries.
A) Monthly minimum wage: NRs. 6,205/-
B) Monthly dearness allowance: NRs. 3,495/-
C) Daily minimum wage (In case of workers or
employees working on daily wage basis): NRs. 395/-
Private organizations can provide remuneration more than
the minimum wage based on qualification, need and
negotiations.
The Labour Act states that the minimum wage needs to be
revised every two years.
Earlier, the minimum wage stood at total NRs. 8,000/-
(Including NRs. 5100 as monthly minimum wage and NRs.
2,900/- as dearness allowance). The daily minimum wage
stood at NRs. 318/-.
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