executive compensation in pt telkom
DESCRIPTION
Midtest Presentation of Compensation Management Course by Siti Kania MeviantiTRANSCRIPT
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PROJECT
DATE CLIENT08/03/2012 SITI KANIA MEVIANTI / 19009108
Executive Compensation in PT TelkomMB 4015 – Compensation Management
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INTRODUCTION
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Compensation Management
The remuneration received by the employees in return for his/her
contribution to the organization
An organized practice which involves balancing work-employee relation by providing monetary and non-monetary benefits.
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Assignment Content
This paper aims to study about the executive compensation of state owned company, especially PT Telkom as the scope of project, and relate them with the implementation of legal aspects, whether it have been compatible or not.
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LEGAL ASPECTS IN COMPENSATION MANAGEMENT
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Legal Aspects Analyzed
Cash Compensation
Base Salary
Merit/Cost of Living
Short-Term Incentives
Long-Term Incentives
Benefits
Income Protection
Work/Life Balance
Allowances
...all factors based on George T. Milkovich on “Compensation”
Legal Aspects related: Ministerial Regulations PER-07/MBU/2010
About Income Guidelines for Directors, Commissioners, and the Supervisory Board of SOE’s
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IMPLEMENTATION OF LEGAL ASPECTS
OF STATE OWNED COMPANIES IN INDONESIA
Company Position Base SalaryTake Home
PayDetails
Bank Mandiri
CEOIDR 166 M /
monthNA Allowances not included
BOD NAIDR 705 M /
monthSalary IDR 27.57 B ; Allowances 17.51 ; Bonus IDR 48
B ; Housing IDR 1B ; Transportation IDR 3.87 B
Bank Rakyat Indonesia
CEOIDR 167 M /
monthNA -
BOD NAIDR 333 M /
monthIncome per year: IDR 4 B
Bonus, incentives and tantiem: IDR 159.9 B
Bank Negara Indonesia
BOD NAIDR 314 M /
monthIncome per Year: IDR 3.7 B
PT Aneka Tambang
CEOIDR 105 M /
monthNA Incentives, bonus and allowances not included
BOD NAIDR 250.8 M / month
Income per Year: IDR 3.01 B(Salary and Allowances)
PT Timah Tbk
BOD NAIDR 80 M /
monthIncome per Year: IDR 962.2 M
(Salary)
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CASE STUDY
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Company Profile
Largest telecommunication and network service provider in Indonesia
Encompass a broader portfolio of TIME (Time, Information, Media, and
Edutainment)
Committed to ongoing innovation, positioned as a strongly competitive new wave company
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IMPLEMENTATION OF LEGAL ASPECTS
IN PT TELKOM INDONESIA
Position Base Salary Take Home Pay Income per Year Details
CEO IDR 118 M/month IDR 602 M/month IDR 7.22 B
Take Home Pay income already includes salary, allowances and
insurances.
BOD NA IDr 544 M/month IDR 6.53 B
Income already includes salary, allowances, and
insurances.
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Type Implemented Legal Aspect
Cash Compensation
Base Salary Yes MR PER-07/MBU/2010 Article 4
Merit/Cost of Living Yes MR PER-07/MBU/2010 Article 2
Short Term Incentives Yes NA
Long Term Incentives Yes NA
Benefits
Income Protection Yes NA
Work/Life Balance
Home Office Yes MR PER-07/MBU/2010 Article 26
Transportation Yes MR PER-07/MBU/2010 Article 21
Housing Yes MR PER-07/MBU/2010 Article 15
Allowances
Health Yes MR PER-07/MBU/2010 Article 22
Clothes Yes MR PER-07/MBU/2010 Article 11
Pension Yes MR PER-07/MBU/2010 Article 10
Communication Yes MR PER-07/MBU/2010 Article 9
Religious Holiday Yes MR PER-07/MBU/2010 Article 8
(Cuti Tahunan) Yes MR PER-07/MBU/2010 Article 13
(Cuti Besar) Yes MR PER-07/MBU/2010 Article 14
Professional Associations Yes MR PER-07/MBU/2010 Article 23
Legal Protection Yes MR PER-07/MBU/2010 Article 25
Club Membership Yes MR PER-07/MBU/2010 Article 27
Representation Cost Yes MR PER-07/MBU/2010 Article 28
Utility Cost Yes MR PER-07/MBU/2010 Article 16
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Critical Review/Analysis
Compared to other state owned companies, PT Telkom had implemented most of the compensation factors based on the legal aspects.
One of many reasons that keeps PT Telkom one step ahead of its competitors.
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Suggestion
PT Telkom has provide enough compensation for their executives, all factors stated in
Milkovich’s book has already covered.
In order to keep pace with the competitors, PT Telkom just need to maintain their compensation
system or maybe improve them.
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CONCLUSION
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No wonder that people all over Indonesia are eager to apply to PT Telkom, since they offers complete
package of compensation for the executives.
‘dream company’ for employees...Research: Warta Ekonomi
Better understanding about compensation system of SOE’s in Indonesia, and its legal aspects.
Better consideration in choosing company to work on in the future.
Conclusion
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Thank You