Module 6: Compensation and Benefits Overview
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Questions and Answers

What are the objectives of the Salary Standardization Law of 2015?

To compare the competitiveness of government pay in relation to the private sector and to craft a compensation strategy to bring government pay closer to market rates.

The Salary Standardization Law of 2015 was approved by President Gloria Macapagal Arroyo.

False

What is the Compensation and Benefits Study for the Public Sector?

A survey carried out by the DBM to administer the compensation and position classification system of the government.

The DBM services were engaged to carry out the Compensation and Benefits Study for the Public Sector by:

<p>Towers Watson</p> Signup and view all the answers

What is the minimum basic salary (SG1) after the implementation of the Salary Standardization Law of 2015?

<p>11,068 a month</p> Signup and view all the answers

The Salary Standardization Law of 2015 does not allow for salary overlaps.

<p>True</p> Signup and view all the answers

What is the guiding principle for the Salary Standardization Law of 2015

<p>Payment of just and equitable compensation to government personnel in accordance with the principle of equal pay for work of equal value</p> Signup and view all the answers

The Salary Standardization Law of 2015 requires that government compensation be adjusted to at least 70% of the market.

<p>True</p> Signup and view all the answers

The Salary Standardization Law of 2015 applies to all government employees, including those engaged through job orders.

<p>False</p> Signup and view all the answers

What types of benefits are included in the Productivity Enhancement Incentive?

<p>All of the above</p> Signup and view all the answers

The Salary Standardization Law of 2015 includes a provision for the Step Increment system.

<p>True</p> Signup and view all the answers

What is the purpose of the Step Increment system?

<p>To recognize and reward employees for their continuous satisfactory service in their present positions.</p> Signup and view all the answers

How often does the Step Increment occur?

<p>Every 3 years of continuous satisfactory service</p> Signup and view all the answers

Employees can progress from Step 1 to Step 8 of the salary grade allocation based solely on years of service.

<p>False</p> Signup and view all the answers

What is the purpose of the Performance Management System?

<p>To recognize and reward employees for their meritorious performance, leading to potential salary grade increases.</p> Signup and view all the answers

The Step Increment system is only applicable to civilian government personnel.

<p>False</p> Signup and view all the answers

What is the 13th Month Pay?

<p>A bonus paid to all government employees twice per year</p> Signup and view all the answers

The 14th Month Pay is only available to government employees who are in regular plantilla positions.

<p>False</p> Signup and view all the answers

To be eligible for the 14th Month Pay, government employees must have rendered at least four months of service from January 1 to October 31 of the current year.

<p>True</p> Signup and view all the answers

The 14th Month Pay includes a mandatory cash gift of $5,000.

<p>True</p> Signup and view all the answers

The Clothing Allowance is a fixed amount of $5,000 per annum.

<p>False</p> Signup and view all the answers

What is the purpose of the Collective Negotiating Agreement (CNA)?

<p>To provide a framework for negotiations between management and employees to address various issues related to working conditions, including compensation and benefits.</p> Signup and view all the answers

Why is the CNA Incentive implemented?

<p>To recognize and reward employees and management for their successful efforts in accomplishing performance targets, often leading to cost savings and improved efficiency.</p> Signup and view all the answers

What is the main focus of the Performance Based Bonus (PBB) system?

<p>To motivate and reward government employees based on their individual and organizational performance, specifically for achievements tied to performance targets and adherence to good governance principles.</p> Signup and view all the answers

Employees who are considered Consultants and experts hired for a limited period to perform specific activities or services with expected outputs are eligible for the Performance Based Bonus (PBB).

<p>False</p> Signup and view all the answers

What are the criteria for receiving the Loyalty Award?

<p>Successfully completing a milestone year in service, specifically the 10th year anniversary and every 5 years thereafter.</p> Signup and view all the answers

The Honoraria system is applicable to any government employee who performs work outside their regular duties, regardless of their position or qualifications.

<p>False</p> Signup and view all the answers

What is a main limitation for the Honoraria system?

<p>The total <em>Honoraria</em> received from all special projects shall not exceed 25% of the individual's annual basic salary.</p> Signup and view all the answers

The Magna Carta Benefits include honoraria for lecturers and resource persons, per diem, hazard pay, subsistence allowance, laundry allowance, free quarters, longevity pay, and salary increase for retirement and terminal leave benefit purposes.

<p>True</p> Signup and view all the answers

Upon retirement, a government employee automatically receives a one-step increase in their basic salary.

<p>True</p> Signup and view all the answers

What are the different types of leaves that government employees are entitled to?

<p>Vacation leave, sick leave, privilege leave, maternity leave, paternity leave, bereavement leave, solo parent leave, leave for victims of violence against women and their children, and special leave for women.</p> Signup and view all the answers

Government employees can monetize a minimum of 10 days of vacation leave credits, but no more than 30 days per year.

<p>True</p> Signup and view all the answers

Government employees can monetize 50% of their accumulated vacation and sick leave credits, subject to the agency head's approval and if funds are available.

<p>True</p> Signup and view all the answers

What is the purpose of the Terminal Leave Benefit (TLB) system?

<p>To provide financial assistance to retirees, both compulsory and those who choose to retire voluntarily, based on their accumulated vacation and sick leave credits.</p> Signup and view all the answers

How is the Terminal Leave Benefit (TLB) calculated?

<p>The calculation is based on the retiree's final monthly salary, the number of accumulated vacation and sick leave credits, and a constant factor of 0.0481927.</p> Signup and view all the answers

The GSIS contribution rate for government employees is nine percent.

<p>True</p> Signup and view all the answers

The PhilHealth contribution rate for direct contributors is currently 2.75% of their monthly basic salary.

<p>False</p> Signup and view all the answers

The PAG-IBIG contribution rate for members is 2% of their monthly compensation, with a maximum of $5,000 as the base salary.

<p>True</p> Signup and view all the answers

What is the purpose of the Employees' Compensation Program (ECP)?

<p>To provide a safety net for both public and private sector employees in the event of workplace-related accidents, illnesses, or death.</p> Signup and view all the answers

The ECP covers all workers in the formal sector, starting from the first day of their employment.

<p>True</p> Signup and view all the answers

The Maternity Leave benefit provided by the SSS includes a maximum of 78 days of leave for a normal delivery.

<p>False</p> Signup and view all the answers

The Maternity Leave benefit is not convertible or cumulative, meaning employees cannot roll over unused days to future pregnancies.

<p>True</p> Signup and view all the answers

The Paternity Leave benefit, as defined by RA 8187, is applicable to the first four deliveries of the employee's lawful wife with whom he is cohabiting.

<p>True</p> Signup and view all the answers

The Paternity Leave benefit is convertible and cumulative, allowing employees to accrue unused days to future pregnancies.

<p>False</p> Signup and view all the answers

The Service Incentive Leave benefit is applicable to all employees, including government employees and those employed in personal service.

<p>False</p> Signup and view all the answers

The Service Incentive Leave benefit is commutable, meaning employees can choose to receive the leave days or a cash equivalent.

<p>True</p> Signup and view all the answers

The Parental Leave benefit, as defined by RA 8972, is only available to single parents who are struggling financially due to difficult circumstances.

<p>False</p> Signup and view all the answers

The Special Leave for Women benefit is applicable only to women who have undergone surgery due to gynecological disorders, regardless of employment status and length of service.

<p>False</p> Signup and view all the answers

The Service Charges sharing policy requires that 85% of collected service charges be equally distributed among all rank-and-file employees, while the remaining 15% is retained by management to cover losses, breakages, and distribution to managerial employees.

<p>True</p> Signup and view all the answers

The Minimum Wage system in the Philippines is based on a single national minimum wage rate that applies to all industries and sectors.

<p>False</p> Signup and view all the answers

Study Notes

Module 6: Compensation and Benefits for Public and Private Sector

  • Salary Standardization Law of 2015: A legislative act to modify the compensation and classification system for civilian government personnel and military personnel. It was approved by President Benigno Aquino III. Key members of the Senate involved included Franklin Drilon, and Loren Legarda.
  • Compensation Adjustment Basis: The proposed adjustments were based on a "Compensation and Benefits Study for the Public Sector". This study compared government pay to the private sector.
  • Study Objectives: Comparison of government pay to the private sector, and development of a compensation strategy to align government pay with market rates.

Highlights of Market Study

  • Market Benchmark Comparison: The study compared government pay to market benchmarks and median total guaranteed pay in the private sector. The study showed the government salaries for lower salary grades were closer to market rate than for higher salary grades.
  • Competitive Review Highlights: The review detailed the competitiveness of government salary structure in various job categories. For example, utility workers show a market position to 79%-126% of the market median, whereas executives showed a market position below 32%-22%.

Guiding Principle of SSL 2015

  • Payment: Just and equitable compensation for government personnel aligning with equal work value.
  • Comparability: Government pay comparable to private sector pay.
  • Standardization: Rationalization and standardization in compensation across all government agencies.
  • Incentives: Performance-based incentive scheme adopted.

Parameter of SSL 2015

  • Minimum Salary Increase: Minimum basic salary for SG1 increased from PHP 9,000 to PHP 11,068 per month.
  • Market Adjustment: Government compensation adjusted to at least 70% of the market rate.
  • Differentiation: Compensation acknowledges differences in responsibilities with no salary overlaps.

Main Objective of SSL 2015

  • Competitiveness: A primary goal to be competitive with the private sector market, so as to attract and retain talent
  • Pay-Performance Link: Strengthen the link between pay and performance.

Monthly Salary Schedule Four (4)

  • Provisions A sample schedule of monthly salaries for various positions, ranging from Utility Workers to Presidents.

Other Topics (Page 3-9)

  • Increment and Progression: Details a one-step increment for official and employee based on 3yr satisfactory service.
  • Market Comparison: Detailed comparisons between SSL and market rates for teachers, nurses, and other positions.
  • Budget Allocation: Discussion of the Personnel Economic Relief Allowance (PERA) Budget Circular (2011-2).
  • Additional Compensation: Includes subsistence, quarters, laundry, hazard, and longevity pay.
  • Representation, Transportation & Monthly Bonus: Details allowance to support government officials expenses.
  • PhilHealth and Pag-Ibig Contributions: Explains contributions and their calculations for various salary levels and types of employment (private/public).
  • Compensation Methods: Describes how compensation is approached in the private sector (e.g. different approaches for varying purposes, methods to evaluate and reward employee performance, and strategies for aligning compensation to the company's goals)

Compensation and Benefits in Public Employee Policies (Page 10-12)

  • Holiday Pay: Applies to all employees except government, retail, and service establishments employing fewer than 10 workers, casuals in positions, and others.
  • Night Shift Differential: Pays an additional 10% of compensation for hours worked between 10 PM and 6 AM.
  • Thirteenth-Month Pay: Required for all employees working at least one month during a calendar year (by December 24 of the year).
  • Separation Pay: Details the basis and conditions for separation pay for employees, based on cause.
  • Retirement Pay: Details, qualifications, amounts for eligible employees completing at least 5 years.

Additional Employee Policies (Pages 10-12)

  • Maternity Leave: Expanded to apply for all types of delivery (caesarean/normal), allowing 105 days in all cases.
  • Paternity Leave: Details benefits, conditions and coverage for all married male employees.
  • Solo Parents Leave: Coverage, application, and qualifications for solo parents.
  • Leave for Violence Victims: Leaves benefits extended for victims of abuse.
  • Special Leave for Women: Includes cases for gynecological surgery, 2 month leave.
  • Service Incentive Leave: Details for employees with one year of service (including government employee exclusions), and is payable at the end of the year.
  • Service Charges: The distribution of service charges between front of house and back of house staff.
  • Minimum Wage Rates: Different minimum wage rates for workers in different sectors.

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Description

Explore the key elements of the Compensation and Benefits module focusing on public and private sector comparisons. This quiz covers the Salary Standardization Law of 2015, objectives of the compensation study, and insights from market benchmark comparisons. Test your knowledge on how government pay aligns with private sector trends.

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