 Monetary benefits payable immediately:

Salaries and wages, dearness and other

allowances, productions incentive or bonus.
 Monetary benefits after some time in the
future: Employer’s contribution to P.F.,
E.S.I., pension etc. Gratuity, Profit linked
bonus
 Non-monetary benefits (fringe benefits):
Free or subsidized food, free medical or
hospital facilities, free or subsidized
education to the employees children, free
or subsidized housing etc.
 Payroll accounting is concerned with the
maintenance of records for the amounts due
to the employees like salaries, wages,
allowances, contributions to P.F and E.S.I.
etc.
 Labour cost accounting is concerned with
identifying the amount of labour cost to be
charged to individual jobs and overhead
accounts.
 Time rate methods
 Piece rate method
 Group bonus plans
 Halsey Premium bonus Plan-
Total wages =
(Time taken X Hourly rate) + 50 X Time saved X
100
Hourly rate
 Rowan Premium Bonus Plan-

Total wages =
(Time taken X Hourly rate)+ Time saved X Time
Standard time
taken X Hourly rate
 Straight Piece Rate Method-
wages = No of pieces produced X rate per piece
Taylor’s differential Piece rate System-
Formula:
80% of normal piece rate when below standard (low piece
rate)
120% of normal piece rate when at or above standard(High
piece rate)
Merrick’s Differential Piece Rate System-
Efficiency Piece rate applicable
Upto 83 1/3% Normal piece rate
Above 83 1/3% to 100% 110% of normal piece rate
Above 100% 120% of normal piece rate
 Where the worker completes his work in half
the time allowed; the bonus under both the
plans will be same
 If time saved is less than 50% of time
allowed, the Rowan plan is beneficial for the
worker.
 If time saved is more than 50% of the
standard time, the Halsey plan is
advantageous to the worker.
 It should be simple to understand by the
workers
 It should be transparent
 It should be simple to administer and reduce
clerical work
 It should act as a motivational scheme
 It should guarantee the minimum day wages.
 Labour turnover is the movement of people into and out of
the organization.
 Measurement of Labour Turnover-
 Labour turnover rate
 Separation rate

= Number of separations
Average number of employees
 Replacement Rate = Number of employees replaced

Average number of employees on

rolls

 Flux Rate = Number joining plus number leaving

average number of employees
 Avoidable causes:
 Dissatisfaction with wages and rewards
 Dissatisfaction with working conditions
 Dissatisfaction with personnel policies
 Lack of transport facilities, accommodation, medical and
other facilities
 Dissatisfaction with working hours
 Bad relation with co-workers
 Unavoidable causes:
 Family circumstances
 Climatic conditions
 Community conditions
 Retirement and death
 Marriage( in case of woman)
 Personal betterment
 Pay problems
 Employees leaving to further their career
 Employees leaving due to conflict
 The induction crisis
 Shortage of labour
 Changes in working requirements
 Losses of unstable recruits
 Adequate statistical control
 Joint control
 Use of exist interviews
 Preventive costs
 Personnel administration
 Medical services
 Welfare
 Pension schemes
 Better scales, Bonus and Perquisite
 Replacement costs
 Inefficiency of New worker
 Employment department
 Training and Induction
 Loss of output due to delay in obtaining new workers
 Cost of tool and machine breakage
 Accident frequency
 Cost of scrap and defective work