ABSTRACT
The top three leading contributors to the inflow of foreign exchange in the Malaysian economy is the Tourism sector, it was estimated that the business were believed to worth MYR 60.6 billion in 2013 (approximately USD19.5 billion) (Tourism Malaysia, 2012). The hospitality industry is also considered part of the Tourism sector and it can be categorized into three segments; transportation services, accommodation and tourist destination (Hayes & Ninemeier, 2009). Kuala Lumpur was ranked as the seventh most visited destination in the world (Euromonitor Report, 2010). The development and growth of the Hospitality and Tourism industry in Malaysia promotes Kuala Lumpur to be the top tenth Best Shopping Cities in the world by CNN’s Travel Survey (Prime Minister Department, 2013). This study is developed as a means to examine the practice of Human Resources Management practice that concentrate on factors such as compensation and performance appraisal. Lodging business provide accommodation for those who are away from homes and in many circumstances the industry uses human to deliver hotel products and services. Therefore, to employ the best service deliverer is seen to be vital. A number of reviews of literature suggest that there are many factors that can enhance employee job performance. Some of the strategies are working environment (culture, belief), physical environment (facilities, equipment), rules and regulations
essential. It was known that there are two types of compensation program namely; direct and indirect financial compensation. Fundamentally, compensation practice can be divided into two categories that are financial and non-financial. As the name implies, the financial compensation involved all benefits in terms of monetary given to employees. Financial rewards can be further divided into two categories that are direct reward and indirect reward. Wages, commission, bonuses are all known as direct reward. Meanwhile, non-financial compensation refers to the satisfaction received by the employees from the job environment itself. Non-financial can be divided into two categories; the job and the job environment (Wayne, 2008). Examples of indirect rewards are; medical leave, life insurance, retirement plan, social security and paid vacation. For the non-financial reward, it refers to the skill and knowledge gained through the job surrounding. The component of compensation system is depicted in Figure 1.
