Starting Performance Appraisal Management

Dear All,

I am working in Fabrication and Erection company since 3 years.

For this year i had taken initiative to start Performance Appraisals.

Previously it was like i have make list of the staff and two of the directors were use to increase the staff salary by 1000/2000/5000/ etc and promotions also.

Now i started PMS by using rating system.

I made the site wise list and i had sent to all site in charges to rate them.

after receiving from site in charge i had forwarded to reviewing officer then i made one consolidated list and i will be giving it to management committee.

Management committee will be doing final ratings.

i fixed up the % of the increment like

0 t0 1 0%
2 t0 3 5%
4 to 5 10%
5 to 6 15 %
6 to 7 20 %
8 to 9 30 %
10 40%

1. i explained you all how i did PMS but would like to know from all of you is this will work?

2. we work on Gross Salary we don’t have CTC system. i would like to organize our compensation.

our salary structure is based on gross salary like
e.g 20000/- gross salary then

Basic=35% of GS
Company Allowance=25% of GS
Edu Allow= 5% of GS
Conveyance Allow= 10% of GS
HRA = 25% of GS

want to ask is this structure will help for higher salary for Tax?

3. now management had decided to give 12 k to the BE fresher, previously we used to give 8k. now my question if we give 12k to fresher then our engs those who are working with 1 yrs exp they are having 10k salary then how to fill this gap?

please guide me
16th April 2010 From India, Pune