The role of wages in a market economy. Wages: what is it, the main functions of wages, its classification and terms of payment according to the Labor Code The regulatory function of wages means
Wage- this is the main part of the funds allocated for consumption, representing a share of income (net output), depending on the final results of the team’s work and distributed among workers in accordance with the quantity and quality of labor expended, the real labor contribution of each and the amount of invested capital.
In economic theory, there are two main concepts for determining the nature of wages:
a) wages are the price of labor. Its size and dynamics are formed under the influence of market factors and, first of all, supply and demand;
b) wages are the monetary expression of the value of the commodity “labor power” or “the transformed form of the value of the commodity labor power.” Its value is determined by production conditions and market factors - supply and demand, under the influence of which wages deviate from the cost of labor.
In labor markets, sellers are workers of a certain qualification, specialty, and buyers are enterprises and firms. The price of labor is the basic guaranteed wage in the form of salaries, tariffs, forms of piecework and time-based payment. Demand and supply for labor are differentiated by its professional training, taking into account demand from its specific consumers and supply from its owners, that is, a market system is formed for its individual types.
The purchase and sale of labor occurs under labor contracts (agreements), which are the main documents regulating labor relations between the employer and the employee.
The most important condition for organizing social production and stimulating highly effective labor activity is the establishment of a measure of labor and a measure of its payment. The measure of remuneration is the remuneration or wages received by workers for providing their labor. In practice, wages, or the income of a particular employee, can take the form of various monetary payments: monthly salaries, hourly wage rates, bonuses, rewards, fees, compensation, etc.
It is also necessary to distinguish between nominal and real wages. Nominal wage or income expresses the total amount of money received by a worker for labor expended, work performed, service rendered, or time worked. It is determined by the current wage rate or the price of labor per unit of work time.
Real wages are the amount of goods and services that can be purchased with a nominal wage.
The essence of wages is that it represents the share of workers expressed in money in that part of the national income that is allocated for the purposes of personal consumption and distribution according to the quantity and quality of labor expended by each worker in social production.
Wages play a huge role in the development of the state’s economy and the improvement of the well-being of the people. It expresses a broad aspect of economic relations between society, the labor collective and workers regarding their participation in social labor and its payment.
On the one hand, wages are the main source of increasing the well-being of workers and employees, and on the other hand, they are an important lever for material stimulation of growth and improvement of social production. In order for production to continuously develop and improve, it is necessary to create a material interest for workers in the results of their work.
There are a number of reasons that influence the amount of remuneration, first of all, equalizing the differences in its size. They are mainly associated with the attractiveness and unattractiveness of professions. Hard, monotonous, dirty and dangerous work should naturally be paid much higher (miners, nuclear workers, dockers, garbage collectors, etc.), otherwise it will not be possible to select people for these specialties. Night work, overtime work, work on weekends and holidays should also be paid. It is this kind of payment that is intended to compensate for the unattractive features of the above professions and working conditions. Such differences caused by non-material reasons are called equalizing differences, since they are not directly related to labor costs and labor productivity.
Professions and types of work that attract a large number of people and are considered prestigious should be paid at lower wages, however, wage rates or fees in prestigious professions (lawyers, doctors, teachers, etc.) should take into account the high costs that these people suffered while learning their professions.
Differences in wages are associated not only with attractiveness and unattractiveness, pleasantness and unpleasantness, prestige and non-prestige of a profession or type of work. We can give a large number of examples where many prestigious professions are at the same time very highly paid (programmers, managers, banking workers, etc.). Differences in wages here are associated with other reasons, and therefore cannot be considered equalizing; rather, they should be called non-equalizing differences in the nature of labor. Such differences are based mainly on the quality of work, the difficulty of obtaining a profession due to material costs and time for education, as well as the need for a certain inclination and natural inclinations for a given profession. These differences are defined by the term “human capital”.
In modern conditions, during the transition to a market economy, in order to stimulate the work of workers, wages are not the only source of income for the employee. The total income of an employee includes the following types of payments: wages at tariff rates and salaries, additional benefits and compensation, incentives and bonuses, social payments, dividends, etc. The relationship between these elements forms the structure of income, or wages, of individual employees and the entire organization .
The salary structure in a particular organization is determined on the basis of a microeconomic analysis of the level of remuneration of workers, existing additional payments, costs and results of personnel labor, productivity and profitability of labor, as well as conditions in the regional labor market, in particular, the balance of supply and demand for labor etc.
The structure of income at enterprises in our country is determined by the ratio of three main components: tariff rates and salaries, additional payments and compensation, allowances and bonuses. Tariff rates and salaries determine the amount of remuneration in accordance with its complexity and responsibility under normal working conditions and corresponding labor costs.
Additional payments and compensations are established as compensation for additional labor costs in case of existing deviations in working conditions. Allowances and bonuses are provided to stimulate high creative activity of personnel, improve the quality of work, labor productivity and production efficiency and for high quality products are established depending on the total profit received or the total income of the enterprise in the amount of 20-40% of the tariff rate.
Bonuses are provided for high-quality and timely completion of production tasks, as well as for the personal creative contribution of employees to the final results of production.
Social benefits include partial or full payment of staff expenses for the following types: transportation, medical care, vacations and days off, meals during work, employee training, life insurance, out-of-town trips, financial assistance, etc.
The development and use of various forms and systems of remuneration make it possible to apply a certain procedure for calculating earnings to each group and category of workers. This provides a more accurate accounting of the quantity and quality of labor invested by workers in the final results of production.
Wages serve several functions.
Reproductive function consists in ensuring the possibility of reproduction of the labor force at a socially normal level of consumption, that is, in determining such an absolute amount of wages that allows the conditions for normal reproduction of the labor force to be realized, in other words, maintaining, or even improving, the living conditions of a worker who should be able to live a normal life (pay for rent, food, clothing, i.e. basic necessities), who should have a real opportunity to take a break from work in order to restore the strength necessary for work. Also, the employee must have the opportunity to raise and educate children, the future labor force. Hence the initial meaning of this function, its determining role in relation to others. In the case when the salary at the main place of work does not provide the employee and his family members with normal reproduction, the problem of additional earnings arises. Working on two or three fronts is fraught with depletion of labor potential, a decrease in professionalism, deterioration of labor and production discipline, etc.
Social function, sometimes stands out from the reproductive one, although it is a continuation and addition of the first. Wages, as one of the main sources of income, should not only contribute to the reproduction of the labor force as such, but also enable a person to take advantage of a set of social benefits - medical services, quality recreation, education, raising children in the preschool education system, etc. And in addition, to ensure a comfortable existence for workers at retirement age.
Stimulating function is important from the position of the management of the enterprise: it is necessary to encourage the employee to be active at work, to achieve maximum output, and increase labor efficiency. This goal is served by establishing the amount of earnings depending on the results of labor achieved by each person. The separation of payment from the personal labor efforts of workers undermines the labor basis of wages, leads to a weakening of the stimulating function of wages, to its transformation into a consumer function and extinguishes the initiative and labor efforts of a person.
An employee should be interested in improving his qualifications in order to earn more money, because... higher qualifications are paid higher. Enterprises are interested in more highly qualified personnel to increase labor productivity and improve product quality. The implementation of the incentive function is carried out by the management of the enterprise through specific remuneration systems based on the assessment of labor results and the connection between the size of the wage fund (WF) and the efficiency of the enterprise.
The main direction for improving the entire wage organization system is to ensure a direct and strict dependence of wages on the final results of the economic activities of work collectives. In solving this problem, the correct choice and rational application of wage forms and systems, which will be discussed below, play an important role.
Status function salary presupposes the correspondence of the status, determined by the amount of wages, with the labor status of the employee. Status refers to a person’s position in a particular system of social relations and connections. Labor status is the place of a given employee in relation to other employees, both vertically and horizontally. Hence, the amount of remuneration for work is one of the main indicators of this status, and its comparison with one’s own labor efforts allows one to judge the fairness of remuneration. This requires the transparent development of a system of criteria for remuneration of individual groups, categories of personnel, taking into account the specifics of the enterprise, which should be reflected in the collective agreement (contracts). The status function is important primarily for the workers themselves, at the level of their claims to the salary that workers of the corresponding professions have in other enterprises, and the orientation of personnel to a higher level of material well-being. To implement this function, a material basis is also needed, which is embodied in the corresponding efficiency of labor and the activities of the company as a whole.
Regulatory function- This is the regulation of the labor market and the profitability of the company. Naturally, all other things being equal, the employee will be hired by the enterprise that pays more. But another thing is also true - it is not profitable for a company to pay too much, otherwise its profitability decreases. Enterprises hire workers, and workers offer their labor on the labor market. Like any market, the labor market has laws for the formation of labor prices.
Production-share the wage function determines the extent of participation of living labor (through wages) in the formation of the price of a product (product, service), its share in total production costs and in labor costs. This share allows us to establish the degree of cheapness (high cost) of labor, its competitiveness in the labor market, because only living labor sets materialized labor in motion, and therefore presupposes mandatory compliance with the lowest limits of the cost of labor and certain limits for wage increases. This function embodies the implementation of previous functions through a system of tariff rates (salaries) and grids, additional payments and allowances, bonuses, the procedure for their calculation and dependence on the payroll.
The production-share function is important not only for employers, but also for employees. Some non-tariff wage systems and other systems imply a close dependence of individual wages on the wage fund and the employee’s personal contribution. Within an enterprise, the wage fund of individual divisions can be built on a similar dependence (through the labor contribution coefficient (LCR) or in another way).
The organization of wages at an enterprise involves solving a twofold problem:
Guarantee payment to each employee in accordance with the results of his work and the cost of labor in the labor market;
Ensure that the employer achieves a result in the production process that would allow him (after selling the products on the goods market) to recover costs and make a profit.
Thus, through the organization of wages, the necessary compromise is achieved between the interests of the employer and the employee, promoting the development of social partnership relations between the two driving forces of the market economy.
The economic purpose of wages is to provide conditions for human life. For this reason, a person rents out his services. It is not surprising that workers strive to achieve high wages in order to better satisfy their needs. Moreover, a high level of wages can have a beneficial effect on the country’s economy as a whole, ensuring high demand for goods and services.
With a generally high level of wages and a tendency towards their increase, the demand for most goods and services is growing. It is generally accepted that this phenomenon leads to the creation of new and development of existing enterprises and contributes to the achievement of full employment. Proponents of the high-wage economy add that in developed industrial countries, wages are both the main source of income and the main source of livelihood for the bulk of the population. The stimulating effect it provides is not only greater than other incomes can provide, but also affects the entire country and the economy as a whole. This is a healthy impact, stimulating the production of basic consumer goods rather than expensive items for the elite. And, finally, high wages stimulate the efforts of enterprise managers to use labor wisely and modernize production.
Obviously, there is a certain limit that cannot be exceeded when setting wages. Wages should be high enough to stimulate demand, but if they are raised too much, there is a danger that demand will exceed supply, which will lead to higher prices and trigger inflationary processes. In addition, it will cause a sharp reduction in employment in society and an increase in unemployment.
It is important that wages, while contributing to the rationalization of production, do not simultaneously generate mass unemployment. It is clear that wage issues occupy an important place in the daily concerns of workers, employers and government authorities, as well as their relations with each other. While all three parties are interested in increasing the overall volume of production of goods and provision of services, and therefore wages, profits and income, their distribution, on the contrary, leads to a clash of interests. The most interested party here is employers, their goals are multilateral - to reduce production costs, while satisfying government requirements for wages, as well as maintaining a measure of social justice and preventing conflicts between the administration and the workforce.
For the employer, the amount of wages that he pays to employees, along with other costs associated with hiring personnel (social benefits, training, etc.) form the cost of labor - one of the elements of production costs.
While employees are primarily interested in the amount of money they receive and what they can buy with it, the employer views compensation from a different angle. To the cost of labor, he adds the cost of raw materials, fuel, and other production costs in order to determine the cost of production and then its selling price. Ultimately, the amount of wages affects the amount of profit that the employer receives.
Thus, the main requirements for organizing wages at an enterprise, meeting both the interests of the employee and the interests of the employer, are:
1) ensuring the necessary wage growth;
2) with a decrease in its costs per unit of production;
3) a guarantee of increasing wages for each employee as the efficiency of the enterprise as a whole increases.
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Labor is the most important factor of production; it creates the basis of national wealth and the gross domestic product of society. At the same time, it provides income for citizens, whose lifestyle and standard of living is largely determined by whether they have and what kind of work they have.
A special role in the structure of an employee’s income belongs to wages. It still remains the main source of income for most workers.
High wages can have a beneficial effect on the economy as a whole, ensuring high demand for goods and services. And, finally, high wages stimulate the efforts of enterprise managers to use labor wisely and modernize production.
There are two main concepts in economic theory determining the nature of wages :
a) wages are the price of labor. Its magnitude and dynamics
are formed under the influence of market factors and, first of all, supply and demand;
b) wages are the monetary expression of the value of the product “working
force" or "the transformed form of the value of the commodity labor force." Its value is determined by production conditions and market factors - supply and demand, under their influence there is a deviation of wages from the cost of labor.
The most important condition for organizing social production and stimulating highly effective labor activity is the establishment of a measure of labor and a measure of its payment. The measure of remuneration is the remuneration or wages received by workers for providing their labor. In practice, wages, or the income of a particular employee, can take the form of various monetary payments: monthly salaries, hourly wage rates, bonuses, rewards, fees, compensation, etc. .
The true essence of wages is manifested in the functions that they perform. Wages serve several functions.
Reproductive function consists in ensuring the possibility of reproduction of the labor force at a socially normal level of consumption, that is, in determining such an absolute amount of wages that allows the conditions for normal reproduction of the labor force to be realized, in other words, maintaining, or even improving, the living conditions of a worker who should be able to live a normal life (pay for rent, food, clothing, i.e. basic necessities), who should have a real opportunity to take a break from work in order to restore the strength necessary for work. Also, the employee must have the opportunity to raise and educate children, the future labor force. Hence the initial meaning of this function, its determining role in relation to others. In the case when the salary at the main place of work does not provide the employee and his family members with normal reproduction, the problem of additional earnings arises. Working on two or three fronts is fraught with depletion of labor potential, a decrease in professionalism, deterioration of labor and production discipline, etc.
Social function, sometimes stands out from the reproductive one, although it is a continuation and addition of the first. Wages, as one of the main sources of income, should not only contribute to the reproduction of the labor force as such, but also enable a person to take advantage of a set of social benefits - medical services, quality recreation, education, raising children in the preschool education system, etc. And in addition, to ensure a comfortable existence for workers at retirement age.
Stimulating function is important from the position of the management of the enterprise: it is necessary to encourage the employee to be active at work, to achieve maximum output, and increase labor efficiency. This goal is served by establishing the amount of earnings depending on the results of labor achieved by each person. The separation of payment from the personal labor efforts of workers undermines the labor basis of wages, leads to a weakening of the stimulating function of wages, to its transformation into a consumer function and extinguishes the initiative and labor efforts of a person.
An employee should be interested in improving his qualifications in order to earn more money, because... higher qualifications are paid higher. Enterprises are interested in more highly qualified personnel to increase labor productivity and improve product quality. The implementation of the incentive function is carried out by the management of the enterprise through specific remuneration systems based on the assessment of labor results and the connection between the size of the wage fund and the efficiency of the enterprise. The main direction for improving the entire wage organization system is to ensure a direct and strict dependence of wages on the final results of the economic activities of work collectives. In solving this problem, the correct choice and rational application of wage forms and systems, which will be discussed below, play an important role.
Status function salary presupposes the correspondence of the status, determined by the amount of wages, with the labor status of the employee. Status refers to a person’s position in a particular system of social relations and connections. Labor status is the place of a given employee in relation to other employees, both vertically and horizontally. Hence, the amount of remuneration for work is one of the main indicators of this status, and its comparison with one’s own labor efforts allows one to judge the fairness of remuneration. This requires the transparent development of a system of criteria for remuneration of individual groups, categories of personnel, taking into account the specifics of the enterprise, which should be reflected in the collective agreement (contracts). The status function is important primarily for the workers themselves, at the level of their claims to the salary that workers of the corresponding professions have in other enterprises, and the orientation of personnel to a higher level of material well-being. To implement this function, a material basis is also needed, which is embodied in the corresponding efficiency of labor and the activities of the company as a whole.
Regulatory function- This is the regulation of the labor market and the profitability of the company. Naturally, all other things being equal, the employee will be hired by the enterprise that pays more. But another thing is also true - it is not profitable for a company to pay too much, otherwise its profitability decreases. Enterprises hire workers, and workers offer their labor on the labor market. Like any market, the labor market has laws for the formation of labor prices.
Production-share the wage function determines the extent of participation of living labor (through wages) in the formation of the price of a product (product, service), its share in total production costs and in labor costs. This share allows us to establish the degree of cheapness (high cost) of labor, its competitiveness in the labor market, because only living labor sets materialized labor in motion, and therefore presupposes mandatory compliance with the lowest limits of the cost of labor and certain limits for wage increases. This function embodies the implementation of previous functions through a system of tariff rates (salaries) and grids, additional payments and allowances, bonuses, the procedure for their calculation and dependence on the payroll. The production-share function is important not only for employers, but also for employees. Some non-tariff wage systems and other systems imply a close dependence of individual wages on the wage fund and the employee’s personal contribution. Within an enterprise, the wage fund of individual divisions can be based on a similar dependence (through the labor contribution coefficient or in another way).
Each function, as a part of a single whole - wages, not only presupposes the existence of other parts, but also contains their elements. For example, functions such as accounting and production, reproduction, and stimulation simultaneously play a social role. In turn, the stimulating and accounting-production functions of wages are realized in the reproduction function. At the same time, with general unity, one of the functions, to a certain extent, may be opposite to another or exclude another, reducing the result of its action.
The most significant contradiction between the functions is that some of them lead to the differentiation of earnings, while others, on the contrary, lead to their equalization. The stronger the equalization, the weaker the differentiation, the weaker the stimulating effect of wages. This is a normal phenomenon, because... it reflects the internal unity and struggle of opposites, and does not indicate the inaccuracy of the identified functions.
The organization of wages at the enterprise is associated with a two-pronged solution tasks :
Guarantee payment to each employee in accordance with the results of his work and the cost of labor in the labor market;
Ensure that the employer achieves a result in the production process that would allow him (after selling the products on the goods market) to recover costs and make a profit.
Thus, through the organization of wages, the necessary compromise between the interests of the employer and employee , promoting the development of social partnership relations between the two driving forces of the market economy.
The Economic Problem of Wages - provide conditions for human life. For this reason, a person rents out his services. It is not surprising that workers strive to achieve high wages in order to better satisfy their needs. Moreover, a high level of wages can have a beneficial effect on the country’s economy as a whole, ensuring high demand for goods and services. With a generally high level of wages and a tendency towards their increase, the demand for most goods and services is growing. It is generally accepted that this phenomenon leads to the creation of new and development of existing enterprises and contributes to the achievement of full employment.
Proponents of the high-wage economy add that in developed industrial countries, wages are both the main source of income and the main source of livelihood for the bulk of the population. The stimulating effect it provides is not only greater than other incomes can provide, but also affects the entire country and the economy as a whole. This is a healthy impact, stimulating the production of basic consumer goods rather than expensive items for the elite. And, finally, high wages stimulate the efforts of enterprise managers to use labor wisely and modernize production.
Obviously, there is a certain limit that cannot be exceeded when setting wages. Wages should be high enough to stimulate demand, but if they are raised too much, there is a danger that demand will exceed supply, which will lead to higher prices and trigger inflationary processes. In addition, it will cause a sharp reduction in employment in society and an increase in unemployment. It is important that wages, while contributing to the rationalization of production, do not simultaneously generate mass unemployment. It is clear that wage issues occupy an important place in the daily concerns of workers, employers and government authorities, as well as their relationships with each other.
2. Basic principles of organization and regulation of remuneration.
While employees are primarily interested in the amount of money they receive and what they can buy with it, the employer views compensation from a different angle. To the cost of labor, he adds the cost of raw materials, fuel, and other production costs in order to determine the cost of production and then its selling price. Ultimately, the amount of wages affects the amount of profit that the employer receives.
Thus, the main requirements for the organization wages at an enterprise that meet both the interests of the employee and the interests of the employer are:
1) ensuring the necessary wage growth;
2) with a decrease in its costs per unit of production;
3) a guarantee of increasing wages for each employee as the efficiency of the enterprise as a whole increases.
The main task of organizing wages is to make wages dependent on the team and the quality of the labor contribution of each employee and thereby increase the stimulating function of everyone's contribution.
When developing a salary policy for an organization at an enterprise, it is necessary to take into account a number of principles:
· application of progressive forms and systems of remuneration that best meet the requirements of the enterprise;
· forms of material remuneration must be competitive with the forms of remuneration of other enterprises;
· independence of enterprises in organizing wages, in establishing forms, systems and amounts of remuneration for workers;
· taking into account the complexity of the work performed and the level of qualifications;
· differentiation of wages depending on the conditions and severity of physical labor, the industry sector of the enterprise;
· payment for the final results of production and depending on the quantity and quality of labor expended;
· material interest of workers in high final results of work;
· systematic increase in real wages, bringing the minimum wage level closer to the subsistence level budget;
· ensuring social protection of workers with the help of state guarantees and the enterprise itself;
· state regulation of wages;
· indexation of wages in accordance with the level of inflation;
· the growth rate of labor productivity exceeding the growth rate of average wages;
· incentive measures for efficient work, product quality, resource savings;
· penalties for violations of labor and production discipline;
· agreeing on general terms and conditions of remuneration with trade unions.
When organizing remuneration, the following tasks are solved:
· choice of forms of remuneration;
· choice of method for forming the basic salary;
· choice of wage regulation mechanism;
· determination of wages;
Issues of labor organization occupy one of the leading places in the socio-economic policy of the state. In a market economy, the practical implementation of measures to improve the organization of remuneration should be based on compliance with a number of principles of remuneration, which must be based on the following economic laws: the law of reimbursement of costs for the reproduction of labor, the law of value.
From the requirements of economic laws, a system of principles for organizing remuneration can be formulated, including:
The principle of payment based on costs and results, which follows from all the above laws. For a long period of time, the entire system of organizing wages in the state was aimed at distribution according to labor costs, which does not meet the requirements of the modern level of economic development. Currently, the principle of payment based on costs and results of labor, and not just costs, is more strict;
The principle of increasing the level of wages based on an increase in production efficiency, which is determined, first of all, by the action of such economic laws as the law of increasing labor productivity, the law of increasing needs. It follows from these laws that an increase in employee wages should be carried out only on the basis of increasing production efficiency;
The principle of faster growth of social labor productivity compared to wage growth, which follows from the law of increasing labor productivity. It is designed to ensure the necessary savings and further expansion of production;
The principle of material interest in increasing labor efficiency follows from the law of increasing labor productivity and the law of value. It is necessary not only to ensure a material interest in certain results of labor, but also to interest the employee in increasing labor efficiency. The implementation of this principle in the organization of remuneration will contribute to the achievement of certain qualitative changes in the work of the entire economic mechanism.
Each enterprise independently determines its policy in matters of remuneration.
At the same time, there are a number of factors external nature, in a certain way limiting decision-making at the enterprise. These include:
Legally established minimum wage per month;
Terms of collective agreements between the administration of the enterprise and the workforce represented by the trade union organization;
Salary levels used by competing business organizations;
The level of employment of the population and the availability of free labor in the required professions and specialties;
Level of labor market conditions, unemployment in the region;
Cost of living (consumer basket).
Internal factors influencing the level of wages are:
Results of economic activities and financial position of the enterprise;
The desire for stable work and stabilization of the workforce;
Demand for highly qualified workers.
In the course of work, the types of work and functional responsibilities performed are not the same: they can be prestigious or non-prestigious, satisfying or dissatisfying the employee. At the same time, workers have different classification categories and qualifications; Changes in working conditions and regime are possible. All this influences the formation of wage inequality and its organization.
Differences in wages are determined by the employee’s compliance and contribution to the final results of the enterprise. Factors that determine differences in employee wages include the level of education, professional training and production experience, determined by practical work experience.
The salary must be such that the employee can support himself and his family. Unreasonably low wages force the employee to look for other sources of income or place of work. This reduces the employee’s “return” due to the fact that he does not recover physiologically and morally by the start of a new working day and works less efficiently. In a market economy, the demand and supply of free labor resources and unemployment have a significant impact on the amount of wages. The labor market strives for an equilibrium system of differences in wages, in which the aggregate demand for each category of labor will be equal to supply, respectively. And at the same time, it is one of the most imperfect markets due to the fact that the potential free labor force is not aware of the availability of all vacant jobs in the region and, in general, about the demand for its labor.
There are several reasons for this:
Lack of complete reliable information in the employment service about vacancies at enterprises;
The desire and production need of the employer to attract an experienced, highly qualified specialist or worker to the enterprise;
Transition to a more advanced democratic and public system for selecting and hiring the necessary categories of workers based on competitive recruitment;
The outdated practice of employment based on the so-called principle of forming “generational dynasties” at prestigious enterprises;
Reservation of vacant jobs for the employment of young specialists, graduates of vocational schools, schools, demobilized from the army and other categories of citizens.
Thus, the amount of wages is influenced by supply and demand, which depend on the quantitative, qualitative and social factors of hiring.
Graphically, the amount of wages can be represented by adding the labor supply and demand curves (Fig. 1).
Rice. 1. Salary amount
Curve – characterizes the demand for labor; – labor supply; point – the point of equilibrium between supply and demand. The quadrangle determines the amount of wages.
Real wages are determined by the quantity of goods and services that can be purchased with a nominal wage.
The amount of real wages depends on a number of factors:
1) this is the value of the nominal wage. The higher the money wage, the higher the level of real wages;
2) the level of prices for consumer goods and services. If the money wage remains unchanged and prices rise, then this is equivalent to a decrease in wages, and vice versa;
3) the availability of a sufficient number of goods that meet the demand of the population. If the price does not change, but there are no goods, then the shortage is also equivalent to a decrease in wages;
4) the level of cost of paid services, i.e. use of transport, home repairs, clothing, etc.
In modern conditions, in accordance with the legislation of the Republic of Belarus, regardless of the organizational and legal forms, enterprises independently determine the forms, systems and amounts of remuneration. However, enterprises do not search for more advanced forms of organizing remuneration than the traditional ones - time-based, piece-rate. In some, being unprofitable, which limits the possibilities of stimulating the work of workers, they are not able to optimize the proportions of wages in accordance with the complexity of the work performed and the professional and qualification characteristics of the workers. Therefore the state regulates wages by establishing and changing the minimum wage, tax legislation, establishing state guarantees, indexation, social insurance and protection.
Thus, the wage regulation mechanism should be based on a combination of the following areas:
· government regulation;
· labor market;
· general agreement;
· collective agreements.
State regulation is carried out directly or indirectly. Direct regulation is the establishment of certain quantitative parameters mandatory for business entities, a minimum wage (based on the minimum consumer budget); the size of the tariff rate of the first category and coefficients; tax rates.
Indirect regulation is carried out through periodic recommendations on the application of tariff rates, on the organization of progressive forms and systems of remuneration, etc.
The minimum wage is the minimum level of wages officially established by the state in enterprises of any form of ownership in the form of the lowest monthly rate or hourly wage. The mechanism for applying the minimum wage is regulated by Article 59 of the Labor Code, Decree of the President of the Republic of Belarus dated February 15, 2002. No. 3 “On some issues of regulation of the minimum wage”, Law of the Republic of Belarus dated June 17, 2002. No. 124-3 “On the establishment and procedure for increasing the minimum wage”, by Resolution of the Council of Ministers of the Republic of Belarus dated December 13, 2004. No. 1579.
In foreign countries, the state minimum wage is reviewed regularly, taking into account the level of inflation and some other factors. For example, in France, a mechanism has been developed that provides for an automatic increase in the minimum wage when prices rise by 2%. In the US, the minimum wage is revised as necessary; The legislation does not provide for the state's obligations to review.
Regulation of the minimum wage is carried out on the basis of laws (USA, France, Spain, etc.) and agreements (Great Britain, Germany, Italy, etc.). Consumption funds, i.e., corresponding social payments or social funds of the state and enterprise, have a certain impact on the incomes of workers.
Internal, microeconomic wage flexibility is associated with the performance of the enterprise, i.e. its profitability and profitability, as well as with the individual performance of the employee himself. An individual approach to increasing wages is built taking into account the following basic provisions that form the system:
1. determination of the minimum annual wage for each category of workers, taking into account all payments;
2. unequal increase in wages within the framework of a predetermined increase in the total wage fund;
3. refusal to index wages as prices rise and switch to increasing them depending on the personal merits of workers;
4. taking into account the employee’s merits, and not his length of service, when deciding on personal salary increases;
5. determination of methods for assessing the individual merits of an employee.
One of the elements that determines the amount of wages is the cost of living budget. It is an indicator of the minimum composition and structure of consumption of material goods and services necessary to maintain human health and ensure livelihoods. The BPM is used as a basis for implementing targeted social policy, to justify the minimum wage, old-age pension, establishing a minimum unemployment benefit and scholarships for students. The subsistence budget is approved by the Council of Ministers of the Republic of Belarus for the main socio-demographic groups in average prices of the previous period on average per capita for: the working population, pensioners, students, children aged 3 to 16 years, children under 3 years of age. The minimum consumer budget represents a higher standard of living wage. It is calculated and approved differentiated by age and social groups by the Ministry of Labor and Social Protection of the Republic of Belarus.
In addition to government regulation, there are other restrictions in matters of organization and remuneration. They are due to regulation through social partnership system .
A partnership is created on the basis of an agreement that regulates the rights and obligations of the participants. The types of partnership include a general agreement between the government, the Union of Employers and trade unions of the country to establish uniform approaches to the organization of wages in industries, regions, and enterprises.
On the basis of the agreement at enterprises, the administration concludes collective agreements with the workforce and the trade union organization. They reflect:
ü questions of forms, systems and amounts of remuneration, material incentives, specific amounts of guarantee and compensation payments, benefits, additional payments;
ü a mechanism for changing wages in accordance with rising prices, the level of inflation, depending on the fulfillment of the indicators of the collective agreement;
ü issues of personnel retraining, conditions for releasing employees;
ü duration of working hours and rest time, vacations;
ü improvement of working conditions and safety; economic security and health protection;
ü social insurance issues, benefits for employees;
ü terms of payment of wages;
ü the circle of employees is determined, for whom an individual level of remuneration is established, etc.
Indirect regulation involves providing conditions for the use of progressive forms and systems of remuneration, informing about the level of wages in various industries, methodological support, consulting, recommendations on the application of regulatory documents.
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Reproductive function consists in ensuring the possibility of reproduction of the labor force at a socially normal level of consumption, that is, in determining such an absolute amount of wages that allows the conditions for normal reproduction of the labor force to be realized, in other words, maintaining, or even improving, the living conditions of a worker who should be able to live a normal life (pay for rent, food, clothing, i.e. basic necessities), who should have a real opportunity to take a break from work in order to restore the strength necessary for work. Also, the employee must have the opportunity to raise and educate children, the future labor force. Hence the initial meaning of this function, its determining role in relation to others. In the case when the salary at the main place of work does not provide the employee and his family members with normal reproduction, the problem of additional earnings arises. Working on two or three fronts is fraught with depletion of labor potential, a decrease in professionalism, deterioration of labor and production discipline, etc.
Social function, sometimes stands out from the reproductive one, although it is a continuation and addition of the first. Wages, as one of the main sources of income, should not only contribute to the reproduction of the labor force as such, but also enable a person to take advantage of a set of social benefits - medical services, quality recreation, education, raising children in the preschool education system, etc. And in addition, to ensure a comfortable existence for workers at retirement age.
Stimulating function is important from the position of the management of the enterprise: it is necessary to encourage the employee to be active at work, to achieve maximum output, and increase labor efficiency. This goal is served by establishing the amount of earnings depending on the results of labor achieved by each person. The separation of payment from the personal labor efforts of workers undermines the labor basis of wages, leads to a weakening of the stimulating function of wages, to its transformation into a consumer function and extinguishes the initiative and labor efforts of a person.
An employee should be interested in improving his qualifications in order to earn more money, because... higher qualifications are paid higher. Enterprises are interested in more highly qualified personnel to increase labor productivity and improve product quality. The implementation of the incentive function is carried out by the management of the enterprise through specific remuneration systems based on the assessment of labor results and the connection between the size of the wage fund (WF) and the efficiency of the enterprise.
The main direction for improving the entire wage organization system is to ensure a direct and strict dependence of wages on the final results of the economic activities of work collectives. In solving this problem, the correct choice and rational application of wage forms and systems, which will be discussed below, play an important role.
Status function salary presupposes the correspondence of the status, determined by the amount of wages, with the labor status of the employee. Status refers to a person’s position in a particular system of social relations and connections. Labor status is the place of a given employee in relation to other employees, both vertically and horizontally. Hence, the amount of remuneration for work is one of the main indicators of this status, and its comparison with one’s own labor efforts allows one to judge the fairness of remuneration. This requires the transparent development of a system of criteria for remuneration of individual groups, categories of personnel, taking into account the specifics of the enterprise, which should be reflected in the collective agreement (contracts). The status function is important primarily for the workers themselves, at the level of their claims to the salary that workers of the corresponding professions have in other enterprises, and the orientation of personnel to a higher level of material well-being. To implement this function, a material basis is also needed, which is embodied in the corresponding efficiency of labor and the activities of the company as a whole.
Regulatory function- This is the regulation of the labor market and the profitability of the company. Naturally, all other things being equal, the employee will be hired by the enterprise that pays more. But another thing is also true - it is not profitable for a company to pay too much, otherwise its profitability decreases. Enterprises hire workers, and workers offer their labor on the labor market. Like any market, the labor market has laws for the formation of labor prices.
Production-share function wages determine the extent of participation of living labor (through wages) in the formation of the price of a product (product, service), its share in total production costs and in labor costs. This share allows us to establish the degree of cheapness (high cost) of labor, its competitiveness in the labor market, because only living labor sets materialized labor in motion, and therefore presupposes mandatory compliance with the lowest limits of the cost of labor and certain limits for wage increases. This function embodies the implementation of previous functions through a system of tariff rates (salaries) and grids, additional payments and allowances, bonuses, the procedure for their calculation and dependence on the payroll.
The production-share function is important not only for employers, but also for employees. Some non-tariff wage systems and other systems imply a close dependence of individual wages on the wage fund and the employee’s personal contribution. Within an enterprise, the wage fund of individual divisions can be built on a similar dependence (through the labor contribution coefficient (LCR) or in another way).
Piecework form of remuneration makes payment directly dependent on labor productivity, ensures a combination of interests of the employee and the enterprise.
In this form, earnings depend on the number of units produced, taking into account their quality, complexity and working conditions. It is divided into the following systems:
Direct piecework, in which workers’ wages increase in direct proportion to the number of products they produce, i.e., payment for each unit of production they produce is carried out at the same rate.
Piece-bonus, in which, in addition to the amount of piecework wages, workers are awarded bonuses for specific indicators of their production activities.
Chord, in which a complex of various works is assessed, indicating the deadline for their completion.
With a piece-rate form of remuneration, production accounting can be organized if it is possible to measure and calculate the volume of work performed by each employee in natural meters.
Piecework wages for workers are determined by multiplying the number of works performed (products, operations) by the established price.
Types of wages
There are two types of wages: basic and additional. The main ones include:
payment accrued to employees for time worked;
quantity and quality of work performed;
payment at piece rates, tariff rates, salaries, bonuses;
additional payments in connection with deviations from normal working conditions, for work at night, for overtime work, payment for downtime through no fault of the workers.
Additional wages include:
payments for unworked time provided for by labor legislation;
payment for regular vacations and breaks from work for nursing mothers;
preferential hours for teenagers during the performance of state and public duties;
severance pay upon dismissal.
Depending on the amount of labor and time, there are two main forms of remuneration: piecework and time-based.
The piecework wage system is used when it is possible to take into account quantitative indicators of the result of labor and standardize it by establishing production standards and time standards. Under the piecework system, workers are paid at piecework rates in accordance with the quantity of products produced (work performed and services rendered).
Piece price is a derived value that is determined by calculation. To do this, the hourly tariff rate for the corresponding category of work performed is divided by the hourly production rate or multiplied by the established time rate in hours or days. To determine the final earnings, the piece rate is multiplied by the number of products produced.
When determining piecework rates, they are based on the tariff rates of the work performed, and not on the tariff category assigned to the employee.
Depending on the method of calculating earnings for piecework, there are several forms of remuneration:
direct piecework, when workers are paid for the number of units of products they produce and work performed based on fixed piecework rates;
piecework-progressive, in which payment increases for production above the norm;
piecework-bonus, when remuneration includes bonuses for exceeding production standards, achieving certain quality indicators: delivery of work on the first presentation, absence of defects, complaints, savings in materials.
The time-based wage system comes down to paying the cost of labor for time worked and is used when it is impossible to quantify the results of the labor activity of workers, employees and managers.
With a time-based wage system, the salary depends on the actual time worked and the employee’s tariff rate, and not on the number of works performed. Depending on the unit of accounting for time worked, the following tariff rates are applied: hourly, daily, monthly.
In the time-based wage system, there are two forms: simple time-based and time-based bonuses.
With simple time-based wages, a worker's earnings are determined by multiplying the hourly rate of his grade by the number of hours he worked. With time-based bonus wages, a bonus is added to the amount of earnings at the tariff, which is set as a percentage of the tariff rate.
Concept of cost
The cost of products (works, services) is the current costs of an enterprise expressed in monetary terms for the production and sale of products (works, services).
Product cost is a capacious, diverse and dynamic economic category. It is the most important qualitative indicator that shows how much it costs an enterprise to produce and sell products. The lower the cost, the higher the profit and, accordingly, the profitability of production.
Calculating the cost of production for an enterprise is necessary for:
Assessment of the implementation of the plan for this indicator and its dynamics;
Determining the profitability of production and individual types of products;
Implementation of internal production cost accounting;
Identification of reserves for reducing production costs;
Determining prices for products;
Calculation of the economic efficiency of introducing new equipment, technology, organizational and technical measures;
Justification for the decision to produce new types of products and discontinue obsolete products, etc.
The cost of production includes various types of costs that depend and do not depend on the operation of the enterprise, arising from the nature of this production and not directly related to it.
The influence of the state on the formation of production costs is manifested in the following cases:
Division of enterprise costs into current production costs and long-term investments;
Distinguishing the costs of enterprises into those attributable to the cost of production and those reimbursed from other sources of financing (financial results, special funds, target financing and target revenue, etc.);
Establishment of depreciation standards for fixed assets, rates of contributions for social needs, amounts of various taxes and fees.
In addition, it is necessary to keep in mind that at enterprises, although part of the costs is included in the cost of production in the amount actually produced, for tax purposes their amounts are adjusted taking into account the limits, norms, standards and rates approved in the established manner (travel expenses, entertainment expenses ).
Cost calculations may vary due to the following factors:
1) depending on the degree of readiness of the product and its sale, the cost of gross, marketable, shipped and sold products is distinguished;
2) depending on the quantity of products - the cost per unit of production, the total volume of products produced;
3) depending on the completeness of inclusion of current expenses in the cost of the calculation object - the full actual cost and the reduced (truncated) cost;
4) depending on the efficiency of cost formation - actual, standard, planned;
5) depending on the cost accounting center, the following are distinguished:
a) workshop cost - represents the costs of the workshop associated with the production of products;
b) production cost - in addition to shop costs, it includes general business expenses;
c) full cost - reflects all production and sales costs, consisting of production costs and commercial expenses.
Thus, it is clear that in the theory and practice of accounting there is more than one concept of cost, and it is necessary to clarify each time which indicator we are talking about.
One of the main conditions for obtaining reliable information about the cost of production is scientifically based
Salary functions
Reproductive
ensuring full recovery of the employee’s expenses and creating conditions for his normal life activities
Stimulating
wages are a means of motivation through the establishment of a quantitative relationship between the amount of payment and the quantity, quality and results of workers’ work
Social
wages should reflect the social status of the employee and solve the problem of social justice
Formation of effective demand
the influence of wages through the effective demand of the population on the volume and structure of goods and services produced and, to a large extent, on investment policy
Regulating (resource-allocation)
optimization of the deployment of labor resources by region, economic sector, enterprise through influence on labor demand and supply
Accounting and production
reflects the degree of participation of living labor in the process of formation of the price of a product, its share in the total costs of production.
Motivational
the development of creativity in work and moral and prestigious attitudes shapes the moral qualities of workers, their work morale.
41. Wage regulation system and its elements.
From the requirements of economic laws, a system of principles for regulating wages can be formulated, including:
The principle of payment based on costs and results. For a long period of time, the entire system of organizing wages in the state was aimed at distribution according to labor costs, which does not meet the requirements of the modern level of economic development. Currently, the principle of payment based on costs and labor results, and not just costs, is more strict.
The principle of increasing the level of wages based on an increase in production efficiency, which is determined, first of all, by the action of such economic laws as the law of increasing labor productivity, the law of increasing needs. It follows from these laws that an increase in employee wages should be carried out only on the basis of increasing production efficiency.
The principle of faster growth of social labor productivity compared to wage growth, which follows from the law of increasing labor productivity. It is designed to ensure the necessary savings and further expansion of production.
The principle of material interest in increasing labor efficiency follows from the law of increasing labor productivity and the law of value. It is necessary not only to ensure a material interest in certain results of labor, but also to interest the employee in increasing labor efficiency. The implementation of this principle in the organization of remuneration will contribute to the achievement of certain qualitative changes in the operation of the entire economic mechanism.
Typically, wages are regulated and controlled by competent government agencies.
42. State regulation of wages, its main directions.
State regulation of wages - implementation of measures aimed at implementing the principle of correspondence between the measure of labor and the measure of its payment, ensuring equal pay for equal work.
Directions of state regulation of wages:
Legislative regulation of the conditions and procedure for remuneration, enshrined in the Labor Code of the Russian Federation and other regulations
Regulation of wages of employees in the public sector of the economy based on the tariff system
Establishment of the minimum wage (minimum wage)
Interdistrict regulation using regional coefficients and wage premiums
Tax regulation using direct (income tax) and indirect (VAT, sales tax, excise tax) taxes
Wage indexation
Establishment of regional coefficients and percentages of premiums
Establishment of state guarantees for wages.
There are three types of income and wage policies:
Controlling inflation through taxes and fiscal measures;
Revenue regulation based on government rules and regulations;
Tripartite cooperation policy.
Thus, the state implements measures to regulate wages at two levels:
Determines the state guarantees ensuring the interaction of all employers and employees in order to develop and agree on wage conditions;
Directly implemented by the state. guarantees established for employees of state organizations. sectors of the economy that are financed from budgets of different levels.
Basic functions of payroll
Wages perform several functions, the most important of which are reproduction, incentive, status, regulatory (distribution), production-share, accounting, etc.
Reproductive the function is to ensure the possibility of reproduction of the labor force at a socially normal level of consumption, i.e. in determining such an absolute amount of wages that allows for not only simple, but also expanded reproduction of the labor force.
Status function salary presupposes the correspondence of the status, determined by the amount of wages, with the labor status of the employee. By “status” we mean a person’s position in a particular system of social relations and connections. Labor status is the place of a given employee in relation to other employees, both vertically and horizontally. Hence, the amount of remuneration for labor is one of the main indicators of this status, and its comparison with one’s own labor efforts allows one to judge the fairness of remuneration.
Stimulating function salary is important from the position of company management: it is necessary to encourage the employee to achieve maximum output and increase labor efficiency. This goal is served by establishing the amount of earnings depending on the results of labor achieved by each person. The separation of pay from the personal labor efforts of workers undermines labor basis of salary, leads to a weakening of the stimulating function of wages, turning them into consumer wages and extinguishing a person’s initiative and labor efforts.
The implementation of the incentive function is carried out by the management of the company through remuneration systems based on the connection between the size of the wage fund (WF) and the efficiency of the company.
Regulatory function wages affect the relationship between demand and supply of labor, the formation and degree of its employment. This function serves as a balance of interests of both employees and employers. The objective basis for the implementation of this function is the principle of differentiation of wages by groups of workers, by priority of activities or other grounds (features),
Production-share the wage function determines the extent of participation of living labor (through wages) in the formation of the price of a product (product, service), its share in total production costs and in labor costs. This share makes it possible to establish the degree of cheapness (high cost) of labor power, its competitiveness in the labor market, because only living labor sets materialized labor in motion (no matter how great it is), and therefore presupposes mandatory compliance with the lower limits of the cost of labor power and certain limits salary increases. This function embodies the implementation of previous functions through a system of tariff rates (salaries) and grids, additional payments and allowances, bonuses, etc., the procedure for their calculation and dependence on the payroll.
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