BUSINESS ADMINISTRATION
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Wage and benefits saved due to vacancy
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The cost of reduced productivity while the new employee is learning on the job
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The cost of additional overtime to cover vacancy
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All three answers are correct
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Detailed explanation-1: -Employee cost includes the following: (i) Wages and salary; (ii) Allowances and incentives; (iii) Payment for overtimes; (iv) Employer’s contribution to Provident fund and other welfare funds; (v) Other benefits (leave with pay, free or subsidised food, leave travel concession etc.) etc.
Detailed explanation-2: -There are three cost categories associated with employee turnover. Separation costs account for exit interviews, termination administration, severance pay, and unemployment compensation. Replacement costs account for attracting applicants, interviews, testing, and moving expenses.
Detailed explanation-3: -A layoff is an involuntary separation from work through no fault of employees, often initiated by the employer for economic reasons to cut costs.