Direct versus Indirect Rewards for the Attraction of the Employees

Abstract

What do employees need most in terms of rewards? There is a “optimum package” for rewarding? What percentage of direct and indirect rewards should contain a reward strategy? These are only a few of questions that are elucidated with this paper. In order to make a clear image about direct and indirect possible rewards, this article defines: wages, bonuses, premium pay, participation at profit, different incentives, other direct rewards, mandatory and pension rewards, insurances, paying the not worked time and other indirect rewards and benefits. Further, the theoretical background move forward and make connections also to the legislative connotation of the rewards. The main legislative texts discussed that influence Human Resource Management in terms of direct and indirect rewards are: Law 571/2003 from the Fiscal Code, Title IV from the Labour Code and Employee Benefits from the International Accounting Standards.