Introductio

n
INCENTIVES
Basic Concept

What is incentive? In simple words, incentive is anything that attracts a

worker and stimulates him to work. The incentives can be financial and non-
financial. Both types of incentives play important role under different
conditions. For example, financial incentives are considered to be more
valued under the work conditions where wages are at low levels. On the
contrary, non-financial incentives are more preferable where wage levels are
high and the rate of tax is progressive. However, a review of research
evidences indicates that there is a shift in emphasis in the demands of
employees and their unions from financial to non-financial benefits.

The term incentive has been defined differently by different authors. We

produce here a few of these definitions.

According to the National Commission on Labor,

"Wage incentives are extra financial motivation. They are designed to
stimulate human effort by rewarding the person, over and above the time
rated remuneration, for improvements in the present or targeted results".

Burak and Smith have defined incentive as, " An incentive scheme is a plan
or program to motivate individuals for good performance. An incentive is
most frequently built on monetary rewards (incentive pay or a monetary
bonus), but also may include a variety of non-monetary rewards or prizes".
 According to Venkata Ratnam and Srivastava, "A wage incentive scheme
is a method of payment for work of an acceptable quality produced over and
above a specified quantity or standard".

Now we can define incentive as a system of payment under which the

amount payable to his output. Such a payment is also called 'payment by
results' (PBR). Thus, PBR refers to a method which provides for the "direct
linking of workers earnings to a measure of their performance”.

The main features of incentives from the above definitions can be

listed as follows:
1 Incentives are based on a standard of performance for the job.
2 Incentives are measurable in monetary terms.
3 Incentives are meant to motivate workers for better and more
performance.
4 Incentives have direct linking to performance.
5 Incentives vary from person to person and from time to time for the
same person.

OBJECTIVES
1. Profitable for both workers and management
2. help to increase the production
3. reduce cost
4. high up morale by rewarding workers in proportion to their output
5. recognize the worker for his good performance
6. improve utilization of equipment, materials and sevvice
7. should furnish a basis for cost control and labour control.
8. reduce labour turnover and absenteeism
9. aim at improve relations between workers and management.

LIMITATIONS
1. There is a possibility of reducing the quality of products since
incentives are ususlly based on output.
2. workers paid by results disregard security regulation in order to aceive
output. It will increase the danger of accidents
3. some workers may work day and night, it would affect their health.
 4. jealousy and conflict may arise among employees, because some
employees will earn more .
5. workers may oppose introduction of new machines, methods as they
fear that new methods or machines will decrease their earnigs.
6. when production is disrupted due to management fault, the workers
will insist to get compensation.

An incentive scheme is usually based on three assumptions:

1. The belief that money is a strong motivator.

2. That the relationship between effort and reward can be systematically
established. The relationship so based leaves no doubts in the minds of
the concerned employees.
3. The feedback to the employees is immediate and direct.
Classification of Incentives
Incentives are classified as under.

• FINANCIAL AND NON FINANCIAL INCENTIVES

• INDIVIDUAL AND GROUP INCENTIVES

(a) Financial incentives

Financial incentives include Salary, premium, reward, dividend, bonus,
income from investment. Financial incentives play a very important role in
improving the performance of the employees. Cash plays a very important
role in fulfilling the needs of the individuals especially of labor class.

(b) Non financial incentives

As the employees have other needs like respect and self centered needs
, they can be motivated with the help of following non-financial
incentives.
• Job satisfaction
• Job security
• Respect and recognition
 • Training and other employee improvement programs
• Housing/medical/educational facilities
• Opportunities for growth.
• Suggestion scheme, praise, employee-superiors relationship etc

Individual incentives

Individual incentive are the extra compensation paid to an individual for all
production over a specified quantity.

Advantages
1. Administration of individual incentives is simple because incentives
can be given after the assessment of individual’s work
2. each and everybody gets the return in accordance with work. This
makes the person more dedicated towards the work.
3. persons who do the work with less efficiency are not entitled to
incentives.
Limitations
1. the employees inclination is more on quantity as compared to quality
2. rigidity of rates
3. this incentive system is inappropriate where delays are frequent and
beyond the individual’s control as well as where the work is
automated.
4. adverse effect on speeding production upon the health of the
employee.
5. there is a problem of restriction of output in view of group pressures
from the fellow employees.

Group Incentives
Group incentives system involve co-operation among employees ,
management and the union for reduction in labor, material and supply
costs, strengthening of employee loyalty to the company.
Advantages
1. Reduces absenteeism and production
2. reduces conflict and confusion among group members
3. group incentives lead to lesser control.

Requirement of good incentive

 1. proper climate: this means that the relation between management
and employees should be good and free from suspicion
2. co-operation of workers
3. worker’s participation: wage incentive scheme should be
implemented with the consultation of workers and union.
4. scientific standard: the scheme must be based on scientific
management.
5. simplicity: the incentive scheme should be simple and everybody
must understand it.

6. equitable: this means the scheme should give equal opportunity to

all.
7. flexible: changes may be required due to technological changes,
market demand etc
8. less costly and wide coverage.
9. guarantee minimum wages: it will ensure a security to all
10.ceiling on earning: the maximum amount of earnings must be fixed.
It will help to maintain quality
11.grievance settlement on time
12. timely payment of incentive
13.follow up: required to rectify the mistakes in incentive scheme.’

WAGE INCENTIVE

We may define wage incentive as a system of payment under which the

amount payable to a person is linked with his output. Such payment may be
called “payment with result”
“t refers to all plans that provide extra pay for extra performance in addition
to regular wages for a job”- by Hummel & Nickerson,

Types of Wage incentive Schemes

The following different wage incentive plans for Direct workers will be
discussed here.
 1. straight piece rate
2. Halsey Premium plan
3. Rowan Premium plan
4. Bedaux Point Plan
5. Gnat Task & bonus plan
6. Emerson efficiency plan
7. Taylors differential plan

Individual Incentive (PBR) Schemes

Under this plan, employees are paid on the basis of results. The chief
incentive plans included in this category are discussed in seriatim.

Halsey Premium Plan: This plan, originated by F. A. Halsey, an American

engineer, is a combination of the time and the piece wage in a modified
form. Under this plan, a guaranteed wage based on past experience is
determined. If a worker saves time, he gets 50% of wages for time saved
(called premium) in addition to normal wages. It is optional for the worker
to work on the premium or not. Thus, this plan also provides incentive to
efficient workers.

Advantages
• It is simple to understand. And guarantees time wages to employees
• The wages of time saved are shared by both employers and
workers, so it is helpful in reducing labor cost
• It makes distinction between efficient and inefficient workers.and
gives increasing incentive to efficient workers

Disadvantages
• Quality of the work suffers because workers are in a hurry to save
more and more time to get more and more incentive
• Workers criticize this method on the ground that the employer gets
a share of wages of time saved.
Illustration
Rate per hour = Rs 15/hour
Time allowed for job = 20 hours
Time taken = 15 hours
Calculate the total earnings of the worker under the Halsey plan
S (standard time) = 20 hours
T(time taken) = 15 hours
R(rate) = Rs 15 per hour.
Total earnings = TXR+50%(S-T)XR
= 15X15+50/100(20-15)X15
= 225+2.5X15
Total wages for 15 hrs = 262.5
Find the effective rate of earnings = 262.5/15= Rs17.5

Rowan Premium Plan: This plan was developed by D. Rowan in 1901.

Under this method , the worker is again guaranteed wages at the ordinary
rate for time taken by him to complete the job. The difference between
Rowan and Halsey Premium plans are in the calculation of bonus.

Under Halsey plan, bonus is fixed percentage of the wages of time saved
where as under Rowan plan, bonus is that proportion of the wages of the
time taken which the time saved to the standard time allowed.

The bonus is S-T x T x R

S
and the total earnings will be calculated as

T x R + S-T x T x R
S
Where T= time taken(actual time), S= Standard time (time allowed),
R = Rate per hour

Assume R- hourly wage rate=Rs10

T- Actual time taken to complete the job = 4 hours
S- Standard time or allowed time = 6 hours
W= 10X4+(6-4 / 6 ) X10X4 = 40 + 13.3 = 53.3
Bedaux plan
Under this plan, every operation or job is expressed in terms of so many
standard minutes., which are called ‘Bedeaux points’ or B s ; each B
representing I minute. through time and motion study. Upto 100%
performance i.e. up to standard Bs, the worker is paid time wages without
any premium for efficiency. If the actual performance exceeds the standard
performance in terms of Bs, then 75% of the wages of the time saved is paid
to the worker as bonus and 25% is earned by the foreman.

For example, standard time required for a job is 20 hours ie 1200 Bs in terms
of minutes (20x60) where as a worker has taken 16 hours ie 960 Bs instead
of 1200 Bs . The worker has saved 240 Bs or 4 hours (4x60). Suppose the
time rate is Rs 20/- per hour , the time saved will be equal to Rs 80 ( 4x20)
the worker will get 75% of Rs 80/- . So his total earnings will be as follows
Time wages for 16 hours-actual time taken@ Rs 20 per hour = 320
Bonus 75% of 4hrs wages (75/100x4x20) = 60
Total earnings = 380

Emerson Efficiency Plan:

Under this scheme, both standard work and day wage are fixed. Bonus is
paid on the basis of worker's efficiency. A worker becomes entitled to get
bonus only when his/her efficiency reaches to 67%. The rate of bonus goes
on increasing till he achieves 100% efficiency. Above 100% efficiency,
bonus will be 20% of the basic rate plus 1% for each 1% increase in
efficiency. In this way, at 120% efficiency, a worker receives a bonus of
40% and at 140% efficiency, worker gets 60% of the day wage as bonus.
• In this plan , bonus is payable only when efficiency touches 66.7 %of
standard laid down.
• The amount of bonus payable increases progressively with increae in
efficiency in such a manner that at 100% efficiency, the bonus is 20% of
hourly rate. For efficiency beyond 100% additional 1% bonus is payable for
each 1% Iincrease in efficiency.beyond 100%.
• Thus at 110% efficiency bonus payable is 30% and total wages
payable are time wages for the actual time taken plus 30% of time wages as
bonus.

Illustration
Standard output/day of 8 hrs is 16 units. Actual output of a worker for 8 hrs is
20 units. Rate per hour is Rs 2.5. calculate wage as per Emmerson’s
efficiency plan
Level of performance actual output/standard outputx 100
20/16x100=125%
bonus payable is 45% as follows
At 100% efficiency 20%of time wages
For next 25% @1% for each 25%of time wages
Total bonus 45%
Time wages for 8 hours 8x2.5=20
Add 45% bonus 45/100x20 9
Total wages payable Rs 29/-

Gantt Task and Bonus Plan:

This plan is devised by H.L. Gantt. This plan combines time, piece
wage and bonus.

• First a standard time is fixed for doing a job

• The actual performance is calculated with standard time and
efficiency is determined
• If a worker takes more time than standard time (his efficiency is
below 100%), he is given wages for the time
• If a worker takes standard time to perform the task (efficiency is
100%), he is given wages for standard time and a bonus of 20%of
wage earned
• If a worker takes less than standard time, he is given wages for
standard time plus a bonus of 20% of the wages for the standard time.
In other words if the performance is more than 100%, he is given
wage plus 20%of piece wages
Advantages
1. simple to understand
2. ensures guaranteed time wages to the worker who are below
 average
3. worker tries to become more efficient since increasing rate of
bonus is very satisfying to efficient workers.
4. fixed cost per unit decreases with increase in production due to
incentive for efficient workers

Disadvantages
1. it divides the workers into two categories, one who earns the bonus
and the other who does not.

ILLUSTRATION

Standard output per day = 1000 units

Guaranteed payment = Rs 500/= ie 50 Ps/unit
• Worker A produces 850 units, so his performance is 85%-he will get
Rs 500/- the guaranteed wages
• Worker B’s level of performance is 1000 units. So he will get Rs 500
plus 20% bonus pertaining to standard time ie 20% of 500 ie Rs 100.
so Rs 600

• Worker C ‘s output is 1100 units, so his level of performance is 110%

and therefore he will get 20% piece wages as bonus

Piece wages for 1100 units @ 50 paise = Rs 550

20% bonus = rs 110
Total = Rs 660

Taylors Differential Piece rate System

This system was introduced by Taylor, the father of scientific management

Taylor was of the view that that an inefficient worker had no place in an
organization and he should be penalised by paying low piece rate for low
production. To encourage the worker to complete the work in standard time ,
he is given a lower piece rate. Thus if standard production has been fixed at 8
units/day of 8 hours , the higher piece rate for 8 units or beyond may be Re
1/= per unit and lower rate for an output if less than 8 units per day, may be
80 paise
Per unit.
Hence Taylor decided to give a large reward to those who would complete
the work within or less than the standard time. The system is very harsh to
inefficient workers on account of low rate and low output.

ILLUSTRATION

Calculate the earnings of workers A and B under straight piece rate system
and Taylor’s differential piece rate system
Norma rate/hour = Rs 1.80
Std time/unit = 20 seconds
Differential to be applied = 80% below std and 120% above std
Worker A produces 1300 units per day and worker B produces 15000
units/day
Solution
Standard production per 20 seconds =1unit
Therefore per minute=60/20=3units, per hour 3x60=180 units, per day of 8
hours will be 180x8=1440 units
Normal rate/hour= Rs 1.80
Normal piece rate 180/180 units = 1 paise
Low piece rate below standard production 1P X80/100=8Paise
High piece rate at or above standard = 1PX120/100=1.2 Paise
FOR A
Under straight piece rate system 1300 units@1P – 1300X1/100=Rs 13
Under Taylors Differential plan 1300 units@ 0.8P=1300X8/10X1/100= Rs
10.40
FOR B
Under Straight piece rate = 1500@IP = 1500X1/100 = Rs 15
Under Taylors Differential plan = 1500@1.2=1500X12/10 X 1/100=Rs18
Group Incentive Schemes

The incentive schemes discussed earlier can be applied on a group basis also.
Group incentive schemes are appropriate where jobs are interdependent. It is
difficult to meaningfully measure individual performance and group
pressures affect the performance of the members of the group. The chief
group incentive schemes are discussed here.

Profit-sharing: The concept of profit-sharing emerged towards the end of

the nineteenth century. Profit-sharing, as the name itself suggests, is sharing
of profit of organization among employees. The basic rationale behind profit-
sharing is that the organizational profit is an outcome of the co-operative
efforts of various parties, therefore, employees should also share in profits as
shareholders share by getting dividend on their investment, i.e. share capital.
The very purpose of introducing profit-sharing is to strengthen the loyalty of
employees to the organization. Thus, profit-sharing is regarded as a stepping
stone to industrial democracy.
Practical
study

Search for oil by Pak Stanvac, an Esso/Mobil joint venture in 1957, led to
the discovery of Mari gas field situated near Daharki -- a small town in
upper Sindh province. Esso was the first to study this development in detail
and propose the establishment of a urea plant in that area.
The proposal was approved by the government in 1964, which led to a
fertilizer plant agreement signed in December that year. Subsequently in
1965, the Esso Pakistan Fertilizer Company Limited was incorporated, with
75% of the shares owned by Esso and 25% by the general public. The
construction of a urea plant commenced at Daharki the following year with
the annual capacity of 173,000 tons and production commenced in 1968. At
US $ 43 million, it was the single largest foreign investment by an MNC in
the country.

A full-fledged marketing organization was established which undertook

agronomic programs to educate the farmers of Pakistan. As the nation’s first
fertilizer brand, Engro (then Esso) helped modernize traditional farming
practices to boost farm yields, directly impacting the quality of life not only
for farmers and their families, but for the community at large. As a result of
these efforts, consumption of fertilizers increased in Pakistan, paving the
way for the Company’s branded urea called "Engro", an acronym for
"Energy for Growth".

Vision
To be the premier Pakistani enterprise with a global
reach, passionately pursuing value creation for all
stakeholders.

ENGRO Businesses

Engro Chemical Pakistan Limited (ECPL)

The Company’s current manufacturing base includes urea name plate

capacity of 975,000 tons per annum and blended fertilizer (NPK) capacity of
160,000 tons per year. A premier brand and nationwide presence ensure
sellout production. Additionally, the company imports and sells phosphatic
fertilizers for balanced fertility and improved farm yields. Engro’s share of
Pakistan’s phosphates market mirrors or exceeds its urea market share.

Expansion plans include a new urea plant of 1.3 million tons annual
capacity, also at Daharki. The US$ 1 billion project is well underway and on
track for commercial production in mid 2010. This addition will increase
Engro’s urea market share to 35% from 19% at present.
Engro Foods Limited (EFL)

Engro Foods, a wholly owned subsidiary had its first full year of operations
in 2007. The Company continued expanding with additions to brand
portfolio, milk production and distribution capacities.

The portfolio now includes four impressive brands; Olper's milk, Olper’s
cream, Olwell and Tarang. Olper’s market share peaked at 17% during 2007.

EFL operates two dairy processing factories located in Sukkur, and Sahiwal.
The company’s milk collection network now boasts over 700 village milk
collectors and 400 milk collection centers. Covering 2400 villages across
Pakistan, the activities of the Company touch the lives of almost 51,000
farmers.

Engro Energy Limited (EEL)

This wholly owned subsidiary is setting up an Independent Power Plant near

Qadirpur in Sindh; Targeting 2009 for commercial operations, the power
project will have a net output of 217 MW. The plant will utilize low heating
value permeate gas from Qadirpur gas field which is currently being flared.
Engro Eximp (Pvt.) Limited (EEPL) Engro Eximp (Pvt.) Limited is a
wholly owned subsidiary in the trading business of fertilizer imports.
Employee policies
Our constant pursuit towards the welfare of our employees has led to the
formulation of many unique policies, to create a more positive work
environment, promote greater gender diversity, provide opportunities for
training and development and build career opportunities. Such policies
include ethics policy, gift policy, non-discrimination and anti-harassment
policy, maternity leave policy, part time work policy and off track policy.

Financial incentives
In Engro there is some financial incentive but it is only on some high level
like managerial level. According to gift policy and salary policy they give
financial incentive on best working abilities. There are 2700 employees
working in Engro and Engro providing them the best they have. Every year
Engro gave bonus to there employees twice therefore the level of employees
loyalty level is very high in Engro.

Non financial incentives

Engro providing a massive non financial incentive to there employees they
almost complete all the criteria’s of non financial incentives like Job
satisfaction ,Job security Training and other employee improvement
programs, Housing/medical/educational facilities.
There are some following details of non financial increments:

Training and employee improvement

Engro Chemicals Pakistan Limited spend Rs210 million public-private
partnership project for the establishment of a Technical Training Center in
Dharki, District Ghotki, to develop trained manpower for the local industry
The project falls under the Ministry of Industries, Production and Special
Initiatives and is directed towards providing skilled manpower from among
the local population for the cluster of energy and chemical industry located
in upper Sindh. Engro has committed Rs44 million, in addition to, technical
assistance over the next few years to the project.

Job satisfaction
At Engro, they strive to uphold the tradition of excellence and become the
employer of choice. There is a workplace where the employees feel
confident, valued, and most importantly, inspired.

Work life balance

Engro given the importance of family and appreciate that the employees
need to balance their professional and personal responsibilities. It is engro
intent to make it easier for there employees to manage their work/life
balance more effectively. Engro also encourage there employees to take part
in numerous programs aimed at strengthening their overall wellbeing.

Employee friendly policies

Engro constant pursuit towards the welfare of there employees has led to the
formulation of many unique policies, to create a more positive work
environment, promote greater gender diversity, provide opportunities for
training and development and build career opportunities. Such policies
include ethics policy, gift policy, non-discrimination and anti-harassment
policy, maternity leave policy, part time work policy and off track policy.
Women network

Engro believe that networking, coaching and mentoring provide

opportunities for people to grow personally and professionally throughout
their careers at Engro. Engro is known to be an equal opportunity employer.
As part of our diversity initiatives, “WEAVE” was formed to facilitate
informal networks and relationships among women employees of Engro
across functions and affiliates.

Housing facilities

Engro Township
Engro providing proper accommodation near to there plant in Darki. The
Engro Township is one of a complete housing scheme where they provide
every comfort of life. Darki is one of a remote area in interior Sind and it is
really difficult for engineers and technical staff to live there but Engro
provides exact level of urban style in such ruler area.

Infrastructure Schemes
Through drainage and brick-paving schemes, Engro contributed towards
improving basic infrastructure in the labor communities. While drainage
schemes are aimed at improving hygiene and health conditions of labor
residents, the brick paving schemes are geared to reduce possible
injuries to pedestrians from walking on unpaved streets, especially after
sunset and rainfall. Jung has benefited from the drainage scheme in 2008
while Bago Bhutto was a beneficiary of the brick paving scheme in the same
year.

Medical facilities
Dar ul Shifa Clinic
Since 2002, the Dar-ul Shifa Clinic, an evening clinic in a dedicated room at
Sahara Welfare Society, provides free medical consultation services to
patients (mostly women and children). The clinic has treated over 43,000
patients and provided medicines worth over Rs. 1.8 million since its
establishment.
In 2008, 5,039 patients availed this facility and received free or highly
subsidized medicines worth over Rs. 372,000. The most commonly treated
medical ailments were respiratory tract infections
(over 50% of total patients treated), skin diseases (approximately 25% of
total patients treated), and gastro-intestinal tract infections (over 8% of total
patients treated). The highest number of patients
treated by the clinic in 2008 were children (2,665 or nearly 53% of total
patients), followed by women (1,977 or around 39% of total patients) and
men (397 or 8% of total patients).

Snakebite Treatment Facility

Engro’s snakebite treatment facility, housed at the Engro Clinic at Daharki,
is a one-of-a-kind facility available for snakebite victims in Ghotki and
surrounding districts. The facility is open round-the-clock with
professionally trained paramedic staff available to attend to patients.
Since its inception, the snakebite clinic has treated nearly 80,000 patients
and saved innumerable lives. In 2008, the facility treated 4,962 patients, of
which 1,416 patients were administered the anti-snakebite
venom (ASV) serum.

Educational facilities

Engro providing best educational facilities to there employees children’s.

For this purpose there is a proper educational institute in Engro Township
and they also provide institutes in darki.

Sahara Community School

Through Engro’s support, the Sahara Community School was established in
2002. The school educates 247 children from nursery through class 5, of
which 108 are girls and 139 boys, taught by 17 teachers. To maintain
quality, the school keeps a good teacher-student ratio with the annual intake
of students being restricted to 30 children in each class.
In addition to regular classes, the school also holds non-formal classes where
a five-year primary curriculum is covered in three years. The non-formal
classes, which started in August 2006, are meant for overage children who
cannot be admitted to regular classes. Currently two batches, consisting of
46 and 42 children respectively, are benefiting from this program.

The Data Collection

Primary Data

BOOKS

Compensation Management (Matthew J Deluca)

5th Edition

Chapter# 7

Page # 179,183,187

Web site

www.karmayog.org
www.wikipedia.org

www.corporatewatch.org.uk
Secondary Data
Organization

ENGRO Chemical Pakistan (Ltd)

Web site

http://www.engro.com/

http://www.csrpakistan.pk/

SWOT Analysis

Strengths Weaknesses

• ENGRO is the one of a big • Engro mostly focus on non

business group of Pakistan
they have 2700 employees in
there group.
• Engro spend over Rs80
million in different non
financial increments for there
employees.
• The employees loyalty level is
very high because of there
policies Such policies include
ethics policy, gift policy, non-
financial incentive but cash
plays a very important role in
fulfilling the needs of the
individuals especially of labor
class.
• One of a weakness is that the
Engro incentive programs
generally facilitate the upper
class employees they are not
properly highlighting labor.
 discrimination and anti-
harassment policy.

Opportunities Threats

• ENGRO can do more for there • Business situation in all over

employees they must focus the the world is not suitable in
education facilities. these days this factor may be
effect on ENGRO incentive
• Engro providing some good programme.
facilities in health project but
there is still some upgrading
required.

Conclusion:

We know that business is an economic activity, which is carried out on a

regular basis to earn profit. The biggest challenge today is linking incentives
to performance both large and small organizations have made a variety of
efforts to do so, with mixed results. The problems have ranged from a lack
of communication to a change in the business environment. However, we
must have seen businessmen spending money on different aspects, which is
not going to give them any profit straightaway. The business not only the
name of capital or profit there is most important organ is employees. It is
one of a basic responsibility of organization to keep motivated and establish
there employees. It is necessary to improving the quality of employee’s life
and therefore some provide housing, transport, education and health care to
their employees and their families. In some places businessmen provide free
medical facility to there labor. Incentive pay plans are not always popular
because they have problems that may make them not worth their advantages.
The assumption that workers operate only on an economic level is not
supported when one sees the restriction of output that often occurs in
incentive pay plans. Incentive pay plans also require considerable
administrative costs, take control away from supervisors, and require a
supportive climate within management. Further, the inability to define
performance in a way that is complete and acceptable often has doomed
incentive pay plans. Changing the conditions of the plan once established is
very difficult, as it is often seen as taking away things from the employee.
Finally, incentive pay plans for one group in the organization may be
perceived as inequitable by other groups in the organization.

Recommendations:

I found Engro one of a big business group of Pakistani industries. They

provide good jobs to there employees but there responsibilities are not ended
there they must provide them more facilities. I also realize that there
incentive programs are impressive but my recommendation is that the Engro
provide proper housing scheme to there labor and there are much more to do
in health program specially the hepatitis medication.

References

BOOKS

Compensation Management (Matthew J Deluca)

5th Edition

Chapter# 7

Page # 179,183,187

Web site

www.karmayog.org
www.wikipedia.org

www.corporatewatch.org.uk
http://www.engro.com/

http://www.csrpakistan.pk/
http://books.google.com.pk/

http://dictionary.reference.com/browse/incentive