UNIVERSITI UTARA MALAYSIA

OTHMAN YEOP ABDULLAH GRADUATE SCHOOL OF

BUSINESS

BSMH 5143Compensation and Benefits

Management

Compensation Best Practices

INTELL

By;812399813315813379813397814284

Presentation Overview• Introduction INTELL - Sau Yee

• Base Salary & Bonuses - Pridiv

• Allowance - Syahrulniza

• Short and long term incentives - Teh Safina

• Benefits - Huda

Introduction INTELL

Founded in 1968 to build semiconductor memory products.

Intel introduced the world's first microprocessor in 1971.

Impressed by Penang's location, workforce and local government support, Intel had invested $1.6 million by November 1972 to start its first offshore assembly plant (A1).

Today, Intel Penang is home to a high-tech campus with 10 buildings; including one of Intel's largest assembly and test sites and a design and development center.

Introduction INTELL

Visioncreate and extend computing technology to connect and enrich the lives of every person on earth.

Intel Public PolicyIntel works with governments, organizations, and industries around the world to advocate policies that encourage new ideas, promote fair commerce, and protect resources.

INTELL ValuesCustomer Orientation

listen and respond to the customers, suppliers and stakeholders. clearly communicate mutual intentions and expectations.Discipline

Ensure a safe, clean and injury-free workplace. Make and meet commitments.Quality

Achieve the highest standards of excellence Do the right things

right Continuously learn, develop and improve

Code of ConductFive principles of conducting Intel-related business

Conduct Business with Honesty and Integrity

Follow the Letter and Spirit of the Law

Treat Each Other Fairly

Act in the Best Interests of Intel and Avoid Conflicts of Interest

Protect the Company’s Assets and Reputation

Goal & PerformanceIntel rank in green power Since 2008, Intel has been the largest voluntary purchaser of green power in the U.S Inspiring young innovators

In 2012, Intel reached 7 million students through the Intel International Science and Engineering Fair, a program of Society for Science & the Public.Empowering girls and women In 2013, supported the launch of the  “Girl Rising” film which highlight the importance of investing in the education of girls and women to advance economic opportunity.

Base Pay @IntellFactors determine base pay: relevant

education, skills, experience, and job performance

Total direct compensation

Performance-based cash compensation

The Compensation Committee

Actual pay positions vary by individual

Base Pay @Intell - 2011

performance-based compensation 91% - total direct compensation

performance-based cash - 31% on average

total direct compensation in the form of equity awards - 60% on average

Base Pay @Intell

Total cash compensation base salary + performance-based

cash compensation

cash compensation is paid under the annual incentive cash plan based

Base Pay @Intell - Best Practices

Match & Lead pay structure

Pay system based on: - Skills & Knowledge - Performance Based payment

Bonus @Intell

Employee Bonus (EB) - mentioned in the job contract

- focusing on skilled and management staff

- Bonus are financial and non financial

- Obj : as motivation and retention tool

Employee Cash Bonus Program (ECBP)

- solely based on performance- targeted at new employees

Compensation philosophy and practices

At Intel the compensation committee and Intel’s management use the compensation to help recruit, retain and motivate their employees. Compensation also as the way to company depends on for current and future success.

Intel believe that the proportion of at risk, performance based compensation should rise as an employee’s level of responsibility increases.

Intel’s compensation philosophy is reflected as key design priorities that govern the compensation decisions.

There are key designs for compensation at Intel:

I. are to align with stockholders interests.

II. Then compensation benefits also help to motivate employees to achieve their business goals

III. Compensation also can give a balance performance objectives and time horizons.

IV. Through compensation also, Intel will recruit and retain the highest caliber of employees

V. will encourage employee stock ownership and also manage the cost and dilution

VI. help maintain consistency in the way that executive officers and the broader employee population are compensated.

Benefits at Intel(1.) Allowences

ii. Allowances- allowances are vary as well in terms of shift allowances and also car allowances. Shift allowances are for the production employees who engage in shifty basis and also their pay depends on the shift. Meanwhile for extra working hours will be given extra income as well referring to how many working hours. Car allowances on the other hand is for those in sales and marketing department who need to travel all time to promote and branding Intel externally. They will be given certain survival amount for the car usage.

EMPLOYEE’S BENEFITS PLAN

Great Place to Work (GPTW) BenefitsHelp employees to balance their work and personal responsibilities.

Stock ProgramsOpportunity to have their own company stock

Corporate Officer Stock Ownership GuidelinesFor Intel's executive officersGuidelines were set up by Boards(specifies the number of shares that executive officers need to accumulate and hold within 5 years of appointment or promotion)

Short Term Incentives

Medical Incentives

Annual Leave Incentives

Bonuses

Commissions

The Like-reward

Long Term Incentives

Stock Option

Incentive Cash Payment

Incentive Cash Payment

Annual Incentive Cash Payments

Semiannual Incentive Cash Payments.

Annual Incentive Cash

The Compensation Committee sets annual incentive cash target for each executive officer.

Following the end of the year the annual incentive cash target amount is multiplied by an annual incentive cash multiplier, which is the average of three performance ratios.

The three performance ratios are based on:

Intel’s current-year net income or adjusted net income relative to Intel’s average net income used in the calculation over the previous three years.

Intel’s net income growth or adjusted net income growth relative to that of the market comparator group

Satisfaction of Intel operational performance goals.

Semiannual Incentive Cash Payments

Calculates payouts based on Intel’s corporate profitability which links compensation to financial performance.

Payouts are communicated as a number of extra days of compensation, with executive officers normally receiving the same number of extra days as other employees

EMPLOYEE’S BENEFITS PLAN

Purpose of Employee’s Benefit Plan to attract, retain and motivate

employees expectation of job, life and

economic securitybenefits are subject to government

regulation (Eg: EPF, Socso) to be more competitive compared to

other company in the same industry

EMPLOYEE’S BENEFITS PLAN

Intel’s Benefits Plan

Healthcare BenefitsDental and vision correction coverage, and supplemental coverage including dependent coverage available at discount rate.

Life and Accident InsuranceInsurance cost paid by Intel

EMPLOYEE’S BENEFITS PLAN

Retirement Plan Intel will contribute 12% of an

employee’s monthly earnings to employees’ EPF account.

Retirement gift payout ( age ≥ 55 and minimum 10 years of service with Intel )

Employee Assistance Program (EAP) Helps family enjoy a happy,

healthy and productive life Provide confidential access to

short-term professional counseling service, together with work or life services. (Eg: free childcare and eldercare assistance

counseling)

THANK YOU