India is a country with enormous employment opportunities and as of the year 2015, 1,171.32 lakh people in India are employed by the MSME sector. To improve employment in these enterprises, compensation acts as a major managerial practice that influences an enterprise to perform better. In this micro context, Compensation practices may include giving salaries on time, providing leave encashment benefits, providing allowances, providing employee perks, overtime considerations, etc. The following study is a factor analysis of 50 respondents’ responses to reduce the seven variables into comprehensible few factors depending on their inter relationships and factor loadings. Thus, it was concluded in this study that employees are giving first preference for employee security on the job among the compensation practices in these micro setups. In due course of time with the changing paradigms it can be predicted that providing employee perks and allowances will reasonably be given priority among these small and micro enterprises after job security.