The form of paid popular today, including: paid time to time, paid according to the product, pay exchange, paid by revenue KPI. Each form has advantages, limitations and suitability to each type of different businesses. The selection form to pay appropriate wages to help businesses optimize costs to ensure the motivation retain talent.
The choice of the form of pay appropriate wages plays a key role to help businesses just optimum costs, personnel, just retain the best talent. Depending on the particular industry, the volume of work and business strategy, the business can apply as many forms as paid by the time, by product, by revenue or by exchange. Each method has advantages, limitations, private, directly affecting work motivation, engagement, effective production and business.
Understand the pros and cons of each form not only help construction business policy pay transparency, efficiency but also ensure full compliance with the principle of payment according to current labor law. The same Lac Viet Computing learn the form of paid downloads in the business today.
1. Concept and meaning of the form of payroll
The form of payroll is the method of business applicable to determine the pay for employees based on the basis of the agreement, the volume of work, time of work or results achieved. This is important element in human resource management because it directly affects the satisfaction of employees and the ability to control the budget salary.
For example, a manufacturing enterprise can be paid by products to encourage increased productivity, while a service company usually applied form of payroll from time to time to ensure steady income for employees.
Meaning with business and workers
- For business: choosing the form of pay appropriate wages to help optimize personnel costs, encourage work performance, maintaining competitiveness on the labor market. A mechanism reasonable wage also minimize the risk of labor disputes, thereby saving the cost of legal management.
- For workers: the form of paid clear, transparent, fair will create trust, motivation and encourage professional development. According to the report of the Organization international Labor office (ILO) in the year 2023, transparency in pay wages to help decrease to 20% of capacity, employees leave the company in the first 12 months of employment (source).
In Vietnam, the Ministry of Labor laws 2019 (Article 94 and Article 95) clearly stated principles pay: corporate pay salary directly in full on time; not distinguish gender in the pay wage; guaranteed salary not lower than the minimum wage due to state regulations. Adopting the form of payroll in business should be based on agreement with the employee, in accordance with the characteristics of work at the same time ensure the rights of both parties.
2. The form of paid downloads in Vietnam
Below is the detailed analysis of the form of payroll in business to help managers understand the characteristics, advantages and disadvantages, how to apply efficiency ensure both compliance with the principle of payment according to the labor law, both optimal cost just create motivation for employees.
2.1. Form pay over time
Pay over time is the method of salary calculation based on the time actually worked by the employee, may charge by the hour, day, week or month. This is the most common form in the industry requires the stability of working time rather than number of finished product, for example: office, administration, protection of customer care.
For example: A staff administrative salary 12.000.000, if in month working full number of days as specified (for example 26 days), you'll get full pay. If leave without pay 2 day salary will be deducted respectively.
Distance calculator
- By month: month Salary = salary agreement / number of working days standard × number of days actually worked.
- According to day/time: day/hour = month salary / number of days or hours worked standard × number of days/hours actually worked.
For example, Employees whose salary 12.000.000 VNĐ/month, 22 days will be paid 12.000.000 VNĐ. If 20 days, the salary received = 12.000.000 / 22 × 20 ≈ 10.909.000 VND.
Value of benefits for businesses:
- Easy to manage, cost estimates for the hr: Business can calculate the fixed salary every month, advantageous in financial planning.
- Encourage stability and commitment: employees tend to stick for a long time when steady income, don't depend too much on fluctuations in output.
- Meet the requirements of the law: this form is consistent with the principle of payment is stated in The Labor code of Vietnam, guaranteed the rights of the minimum wage, working time.
Restrictions
- Not directly reflect the performance of the individual.
- If not combined KPI or performance bonuses, which can lead to psychological work “full time”, not “sufficient quality”.
2.2. Form paid according to the product
Piecework is the adjective form of salary based on the amount and quality of the product or service that the employee complete. Can apply to industrial production, machining, industry, service is the output measurement is.
For example, A worker may get 5,000 coins for each shirt standard. If that month may 2.000 pcs, income will be 10,000,000, not bonus pass output.
Distance calculator: Salary = Single product price × Number of standard products.
For example, workers may, with a price tag of 25,000 VND/jacket, complete 200 jacket/month-standard wage = 25.000 × 200 = 5.000.000 VNĐ.
Value benefits for businesses
- Optimal labor productivity: workers are paid according to the work efficiency, from then automatically have the motivation to increase production and quality.
- Reduce fixed costs: Salary fluctuations in the output to help businesses more flexibility when market demand decreases.
- Create fairness internal: income proportional to the effort, avoid drama, “in the many, who do little but enjoy the same”.
Restrictions
- Easy to create pressure on the amount, affect workers ' health.
- If quality control is not good, the product error may increase.
When should I apply: manufacturing, machining, agriculture, food processing where the product is clearly quantified.
2.3. Form of paid exchange
This is a form of pay that business and labour (or labor) agreement before a salary fixed to complete the package a volume of work or specific projects, in the specified time.
Salary does not depend on the number of days of work, duration of labor, or the number of hours the, which is based on the final result.
Can apply for individual or group with the contract clear about the scope of work, standard quality, mold delivery time.
How to specify salary
- Based on volume, the difficulty of the work.
- Reference costs, the expected time to complete.
- Can plus bonuses if the delivery deadline or quality of exceeding requirements.
Advantages
- Flexible, encouraging employees to actively work organization, the optimum duration.
- Reduce the pressure constant monitoring of the business, saving management costs.
- Suitable for work, fashion service, project, or product has clear requirements.
Cons
- If standard delivery is not described clearly incurred controversy about the quality or volume.
- Workers who can work fast but the lack of guaranteed quality if not controlled well.
- Business difficult to track progress if the exchange packages without mold inspection periodically.
For example apply
- Exchange construction of the rough, a work item built-in 45 days.
- Exchange machining 1,000 products furniture within 2 months.
- Exchange service maintenance IT system in 3 months, including troubleshooting and routine maintenance.
Note management
- Need to sign a contract or clear agreement on scope, quality, schedule, criteria, testing and method of payment.
- Should have the mold test between states to promptly processed if the progress or the quality is not reached.
2.4. Form paid by the revenue or commission
Income is calculated based on a percentage of revenue, contract value, or profit that employees bring to the business.
Often combination of sticky wages (guaranteed minimum level of income) and payroll software (commission/revenue). The commission percentage can be fixed or under the ladder (revenue higher, percent larger).
How to determine the roses
- Based on the profit margin of the product/service.
- Consider the face by the market, competition policy in the industry.
- Can adjust according to each stage of business or each group of products.
Advantages
- Create a powerful incentive for employees to find customers, key contracts and increased sales.
- To help businesses only pay when really there is revenue-optimal personnel costs.
- Flexibility in the application for each product, service or business area.
Cons
- Income volatility, can cause instability in personal finance if turnover is low.
- The pressure of business can lead to unhealthy competition, or risk selling false commitment.
- Businesses need to have a system measuring revenue transparency to avoid disputes.
When to apply: parts trading, brokers, insurance, real estate, financial consulting, advertising services. The industry has the value of the contract or time latch single long.
For example apply
- Employees, real estate brokers, get 2% of the value of apartments for sale success.
- Business software get 10% on the contract value services to sign new.
- Counselor insurance get commission according to each insurance package customer purchases.
Note management
- Building regulations roses transparent, public, way, time of payment.
- Combined training, sales skills and professional ethics to avoid risk commitment false.
2.5. Pay flexible (Flexible Pay)
Pay flexible model is a combination of methods to pay different salaries in the same structure, income, for example: the salary is fixed by the time (to ensure stability) + salary fluctuations in product, performance, or business number (motivational).
The goal of this form is to ensure both stable source of revenue for the staff, just create incentive for them to improve productivity.
Advantages:
- Balance between stable income, encourage performance.
- To help businesses easily customize wage policy in accordance with each department, location.
- Increase the level of satisfaction mounting employees thanks to meet all needs, financial security and the opportunity to increase income.
Restrictions:
- System requirements salary management transparent, easy to understand, if not, will cause confusion or sense of injustice.
- Difficult to apply if the business is no measurement data accurate performance.
- Easily lead to comparisons between the parts if the structure fluctuations, uneven.
Object suitable business:
- Business medium and large scale operations multidisciplinary or have many kinds of different positions (administrative, production, sales...).
- Organizations want to move from pay hard to model elements recommended but still keep stability.
2.6. Paid according to performance (KPIS/OKRs)
This form is mounted directly to the income of employees with the work results, based on indicators that measure efficiency (KPI) or target – result key (OKRs). Wages are usually composed of a fixed part + bonus/commission based on the results achieved against the objectives set out.
Advantages:
- The inextricable link between your business goals and personal effort.
- Create a clear motivation for employees to strive to achieve or exceed targets.
- Easily adjust the award to reflect the business reality.
Restrictions:
- Can create pressure high, easy to cause stress or imbalance work – life.
- If KPIS/OKRs don't set reasonable, staff can focus on only short-term goals, ignoring long-term benefits.
- Need tracking system transparent reviews to avoid controversy.
Object suitable business:
- The business can measure work efficiency clear, especially industry, sales, marketing, project management, production by production.
- Organizations have a culture of transparency, result driven, ready-investment rating system work efficiency.
3. Should choose the form of paid how? The selection criteria suitable for business
Choosing the right form of paid not only decided to effective hr management, but also directly affect the ability to retain talent and competitiveness of the business. A form of paid accordingly to ensure both meet the principle of pay under the labor laws, medium optimization, budget, medium, motivational work.
3.1. Scale, industry activity
Large-scale enterprises often applied to combine multiple forms of wage payment in the business to fit the diversity of location, parts.
For example: office block paid from time to time to ensure the stable block production application form paid by products to promote productivity. In contrast, small business or startup is usually preferred mechanism to pay wages, flexible, associated with the result of the work to reduce the pressure fixed costs.
3.2. The nature of work (quantitative or qualitative)
With work that yields easily measured (e.g., apparel, production of components), the form of paid according to the product help pinned income with actual results, motivational markedly.
With the qualitative (consulting services, content creation), form paid over time or according to the project to help ensure a stable income, at the same time easy to control the quality.
Choosing the wrong form can cause an imbalance: productivity does not increase, although the cost of personnel or staff lack motivation because income does not reflect the effort.
3.3. Strategic goals of the business
If the goal is to increase productivity in the short term, businesses can apply form paid securities or according to the product. Conversely, if the priority retain talent, wage policies need to combine between the fixed part (base salary from time to time) and the volatility (bonus according to performance).
3.4. Regulatory factors, transparency
All forms of pay in the enterprise must comply with the principle of payment according to the law of labor: paid in full, on time, irrespective of gender, not lower than the minimum wage. Besides, transparency in the way payroll is the key element that helps build confidence limit disputes.
For example, if the applied form of paid according to the product, businesses should announce clearly the level, standard quality, how to determine the unit price of the product. Transparency helps employees understand and believe in the wage mechanism, while protecting the business before the legal risks.
4. The optimal solution process payroll with hr software
In the context of business must manage many forms pay different salaries as paid by duration, by product or by revenue, the calculation is not only time-consuming but also the potential risk of errors. Software hr management modern bring the benefits highlights:
- Process automation salary calculator: Hệ thống có khả năng tổng hợp dữ liệu từ hệ thống chấm công, sản lượng, KPI… để tính toán lương chính xác. Điều này giúp giảm tới 90% lỗi sai do nhập liệu thủ công, đồng thời rút ngắn thời gian xử lý bảng lương từ vài ngày xuống chỉ còn vài giờ.
- Ensure compliance with legal regulations: the management software, payroll be configured according to the current labour code, to correctly apply the principles of pay, the minimum wage regulations on overtime, holiday, new year, deductions filing insurance to help businesses limit the legal risks, labor dispute.
- Save cost management: According to a survey by CIPD 2024, the business application solutions payroll automatically save an average of 20-25% of the cost of personnel management, by reducing the volume of administrative work and limited to outsource services salary calculator.
Software hr LV SureHCS là giải pháp quản trị nhân sự toàn diện được thiết kế linh hoạt để đáp ứng mọi hình thức trả lương trong doanh nghiệp, bao gồm: theo thời gian, theo sản phẩm, theo doanh số hoặc kết hợp nhiều phương pháp.
- Tightly integrated modules: Data from attendance management, production, KPI and contract labor is related more help payroll consistently accurate.
- Automatically apply diverse forms of wage payment: Whether firms pay wages according to the product for workers, according to the time for office staff or sales for the business division system are processed at the same time ensuring the rule of pay transparency.
- Report analysis personnel costs in real time: The leader can see the total cost of salaries, bonus, comparing fluctuations between the states to make decisions timely adjustment.
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CONTACT INFORMATION:
- Hotline: 0901 555 063
- Email: surehcs@lacviet.com.vn | Website: https://www.surehcs.com/
- Office address: 23 Nguyen Thi Huynh, Phu Nhuan, ho chi minh CITY.CITY
The choice of the form of paid not just a matter of compliance with legal regulations but also the strategic hr management important direct impact on work performance, operating costs and the ability to retain talent. Businesses need to carefully consider between characteristics industry, production model – business, objects of labor, as well as goal development to the application form paid accordingly.
