Reference no: EM133043731

Identify the remuneration management issue from the below paragraph and explain the issue in detail 

The TML patnagar lant started operations with a team of employees who were handpicked from those working in the commercial vehicles plant in pune. Patnagar located in the foothills of Uttarakhand and was destined to be an industrial area. Travelling to patnagar for a focus group discussion with employees and senior management. Soni was sure the effort and time involved would be worth it. He felt that patnagar was a new plat with a young employee base and hence, it may have a more positive energy culture than the plants he had visited earlier.

However, soni was disappointed to find that Patnagar was no different from the other plants. The focus group discussion had employees talking about everything with reference to rewards inc;;uding the city's social infrastructure. On the one hand, for senior leadership attraction to a remote location came up as a key engagement driver(i.e., it was easier to secure admission in a good school in remote location). Yet on the other hand, mosy of the graduate engineer trainees (GETs) were looking for opportunities to move back to pune , Chennai or the national capital region as soon as possible.

Another peculiar issue at patnagar was disparity in a component of the salary. To incentivize the team at pune to relocate to patnagar the employees' total pay was protected by balancing the house rent allowance (HRA) difference with a newly added component - personal compensatory allowance (PCA). When the patnagar plant expanded, many external hires were brought onboard. The newly selected employees found an inequity when PCA was missing from their compensation sheets. In addition, those with PCA retained the PCA component in their compensation structure if transferred elsewhere, thereby creating inequity with respect to existing staff in their new location