Question

Mrs. Rajlaxmi is working as the Human Resource Consultant in a firm
manufacturing cosmetic, which is facing a problem of high employee turnover.
The CEO of the company has invited suggestions from her for retaining the
talented employees & reducing the employee turnover. Mrs. Rajlaxmi
recommends that the good employees be rewarded in a way that it creates a
feeling of ownership among the employees and at the same time makes
them contribute towards the growth of the organization.
Identify the incentive and explain its type, which has been suggested by
Mrs. Rajlaxmi to the CEO of the company.
(b)
Also explain any two other incentives of the same type.​

Answer 1

• (1) The given para highlights the financial incentive to be adopted by the firm. Among the financial incentives, the above mentioned para mentions co-partnership as financial incentive. Co-partnership – Under the scheme of co-partnership, a worker gets his usual wages, a share in the profit of the company and a share in the management of the company as well. Co-partnership implies both profit-sharing and control sharing. (2) Following are some of the other financial incentives : (i) Bonus – Bonus is a reward that is offered on a one-time basis for high performance. A bonus may be in cash or in some other form like trips for top sales people. Bonus is different from merit increase which is perpetuated year after year. (ii) Profit-sharing – Under this scheme, employees are given a legitimate share in the surplus earned by the firm. It is a scheme of providing a sort of group incentive to the workers for higher productivity and greater profitability. Employers often use this device to extort the loyalty of workers and reduce the influence of trade unions.