Difference Between Benefits and Incentives
DIFFERENCE BETWEEN BENEFITS AND INCENTIVES
INCENTIVES
DEFINITION
An additional payment (or other remuneration) given to employees as a means of increasing output.
* Increasingly, MNCs these days are designing special incentive programmes for keeping expatriates motivated. In the process, a growing number of firms have dropped the ongoing premium for overseas assignments and replaced it with a one – time, lump-sum premium.
The lump – sum payment has at least three advantages: * First, expatriates realizes that they are paid this only once and that too when they accept an overseas assignment. So the payment tends to retain its motivational value. * Second: costs to the company are less because there is only one payment and no future financial commitment. This is so because incentive is a separate payment, distinguishable from a regular pay, and it is more rapidly for saving or spending. * Third, less chances for pre mature repatriation.
BENEFITS
• Alternatively known as indirect compensation,
• Benefits constitute a substantial portion of international compensation (approx. one third of compensation for regular employees is benefits).
• Benefits include a suit of programmes such as: * Entertainment, Festival celebrations, Gifts, Use of club facilities, provision of hospitality including food and beverage, employee welfare, use of health club, Conveyance tour and travel, Hotel Board and Lodging, vehicles, telephone and other telecommunication facilities, Sponsorship of children. * Basically an employee tends to join and stay with an organization which guarantees an attractive benefits programme. * Vacation along with holidays and rest breaks help employees mitigate fatigue and enhance productivity during the hours employees actually
INCENTIVES
DEFINITION
An additional payment (or other remuneration) given to employees as a means of increasing output.
* Increasingly, MNCs these days are designing special incentive programmes for keeping expatriates motivated. In the process, a growing number of firms have dropped the ongoing premium for overseas assignments and replaced it with a one – time, lump-sum premium.
The lump – sum payment has at least three advantages: * First, expatriates realizes that they are paid this only once and that too when they accept an overseas assignment. So the payment tends to retain its motivational value. * Second: costs to the company are less because there is only one payment and no future financial commitment. This is so because incentive is a separate payment, distinguishable from a regular pay, and it is more rapidly for saving or spending. * Third, less chances for pre mature repatriation.
BENEFITS
• Alternatively known as indirect compensation,
• Benefits constitute a substantial portion of international compensation (approx. one third of compensation for regular employees is benefits).
• Benefits include a suit of programmes such as: * Entertainment, Festival celebrations, Gifts, Use of club facilities, provision of hospitality including food and beverage, employee welfare, use of health club, Conveyance tour and travel, Hotel Board and Lodging, vehicles, telephone and other telecommunication facilities, Sponsorship of children. * Basically an employee tends to join and stay with an organization which guarantees an attractive benefits programme. * Vacation along with holidays and rest breaks help employees mitigate fatigue and enhance productivity during the hours employees actually