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Business Studies- Methods of Pay

Pay and he different sections about it.
by

C Arnold

on 17 October 2012

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Transcript of Business Studies- Methods of Pay

Remuneration Remuneration Methods of Pay The Payment of Employees

Types of Pay

National Minimum Wage Wages Salary This is payed monthly
usually straight into a
bank account This is paid weekly and
sometimes in cash Over 21- £6.08 18-20- £4.98 Leaving school but under 18
16-17- £3.68 Apprentice first year- £2.60 Time Rate Piece Rate
Flat Rate Commission
Overtime Time Rate This is when an employee is paid by how many hours they work

Advantages for Employee
- Everyone recieves the same amount of money for the same amount of time
- Paid for hours you work so more money can be made
- Easy to calculate finances Disadvantages for Employee

- Not as much motivation
- No money will be rewarded for hard work or effort Time Rate Disadvantages for Employer

- Hard to encourage employees Advantages for Employer

-Easily calculate costs
- Work out if you can afford more workers Piece Rate Piece Rate This is when an employee is paid for the number of pieces or units they complete or sell.

Advantages for Employee
- Faster they work, the more money they earn
- Paid for how much effort they choose to put in
- They can choose to take a break for working so hard and earning more money. Disadvantages for Employee

- Rates of pay may be very low
- Workers may be exploited
- Workers may have to work long hours to earn enough money Advantages for Employer

- Makes sure workers are working hard
- Makes sure that employers are not wasting money on paying slacking workers Disadvantages for Employer

- May have to lower sale prices because of bad quality products.
- Many workers may take breaks because they have to work so hard.
- Strikes are more likely due to lower wages. Flat Rate Flat Rate Overtime Overtime Commission Commision Bonus Bonus This is when an employee is paid for working more hours and the pay is usually higher.

Advantages for Employee
- If they have more time they can earn more money This is when an employee is paid for the number of units they sell.

Advantages for Employee
- Harder they work, the more money they earn
- Paid for how much effort they choose to put in This is when an employee is paid the same amount of money a year without taking into account how hard or long they have worked for.

Advantages for Employee
- They can easily calculate their finances
- Does not matter if they do not work as hard This is when an employee is paid extra money to increase motivation. It is normally given near Christmas to keep them working hard.

Advantages for Employee
- They can feel very motivated
- More money can help them in hard times Disadvantages for Employee

- If they work very hard they will not receive any more money
- They are not very motivated. Disadvantages for Employee

- May think the business is taking pity and they will feel less motivated Disadvantages for Employee

- Their normal pay may be lower so they are forced to do overtime Disadvantages for Employee

- Rates of pay may be very low
- Workers may be exploited
-Workers may not sell much and so lose money Advantages for Employer

- They can get more work done in their business
-Motivates employees Advantages for Employer

- Makes sure workers are working hard
- Makes sure that employers are not wasting money on paying slacking workers Advantages for Employer

- They can easily work out their finances Advantages for Employer

- Workers will boost in performance Disadvantages for Employer

- Hard to motivate their workers
- If employees do not work hard they will still be payed the same amount Disadvantages for Employer

- Workers may complain if their bonus is not as big as other peoples. Disadvantages for Employer

- Employees may take advantage of this
- They cannot forecast their costs Disadvantages for Employer
-They may lose money from no sales
- They cannot forecast their finances
- Strikes are more likely due to lower wages. Calculating Pay Gross Pay - National Insurance (12%) - Tax (20%) - Voluntary Deductions Net Pay = Fringe Benefits Fringe Benefits are non monetary rewards for working well at your job. They include:

Company Car
Longer holiday
Life Insurance
Discounts in shops
Free uniform or suit
Flexible hours
Allowed to work from home This is an example of a real payslip This is a payslip example on excel How to Make a Payslip Gross Pay=
Hours x Rate of Pay Total Deductions=
NI (12%)+Income Tax (20%)+Voluntary Deductions Net Pay=
Gross Pay- Total Deductions Employee Name Pay Period Tax Code How to change a decimal to a percentage How to change a decimal to a currency How to Calculate Formulas State Pension pension, Trade Union
subscriptions, give as you earn,
save as you earn Income Tax- Rises the more you earn

First £7,475- tax free
Next £27,425- taxed at 20%
Rest £35,000- taxed at 40%
Last over £150,000- taxed at 50% Communcation Sender Message Channel of Communication Medium Reciever Feedback Communication- Definitions

Sender- An individual who sends a message to a reciever taking into account the nature of the message by deciding the channel and the medium by which the message is sent.

Message- The topic you are talking about for example a report on profits or a warning for speeding.

Channel of Communication- Which way the message goes in a business. For example a manager who needs to speak to a worker would go vertically fown but a manager to a manager would go horizonatlly along the hierarchy. Also it would be taken into account if formal or informal language is used.

Medium- An email verbal written or any other type of communication to contact someone.

Reciever- The person who recieves the message. They will interpret things depending on the medium and how it is worded.

Feedback- This is essential to the sender to know that the reciever has understood the message and if not how they could improve.

Formal- A type of communication intended to share information and which conforms to established proffessional rules and standards as well as processes and avoids wing slang technology.

Informal- A casual form of information sharing typically used in personal conversations with friends or family. In a business it can be used over text or email by socialising employees. Communication- Types

Formal -Used in Proffessional Setting.

Informal- Usually used with family and friends.

Internal- Communication between members of staff from within a business.

External- Communication between a member of staff and someone from outside the business. Communication- Methods
Oral
- Telephone
- Face to Face
- Voice Mail
- Pagers/ Bleepers
- Radios (2 way)

Written
- Letters
- Fax
- Email
- Memo

Video
- Video Conferencing

Graphical
- Graphs
- Diagrams
- Charts
- Tables
- Drawings
Full transcript