COMPENSATION

reliability

measure of consistency of results among various analysts, various methods, various sources of data, or over time.

point factor method of job evaluation

most commonly used system; determined by compensable factors, factor degrees numerically scaled, and weights reflecting the relevance of each factor: (adv) basis for comparison, compensable factors communicate what is valued, (disadv) bureaucratic and rule-bound.

long term incentives

inducements offered in advance to influence longer rate (multi year) results. Usually offered to TOP MANAGERS and PROFESSIONALS to get them to focus on long term organization objectives.

job content

information that describes a job. May include responsibility assumes and/or the tasks performed.

certification of skills in a skill based pay system

is important because perception of fairness, alignment with orgs strategy, may be best for short term initiatives.

job analysis

is the systematic process of collecting information that identifies similarities and differences in the work

internal equity

often called internal alignment, refers to the pay relationships among different jobs/skills/competencies within a single organization. Employees compare to jobs similar to their own, and their job to others at the same employer.

ranking method of job evaluation

orders job descriptions from highest to lowest based on a global definition of relative value or contribution to the organizations success: (adv) easy to explain. (disadv) no basis for comparison.

competency sets

translates each core competency into action

hay plan

uses three universal compensable elements to measure the relative size of jobs

job structures

an ordering of jobs based on their content or relative value.

steps in formulating compensation strategy

assess total compensation implications, map a total compensation strategy, implement strategy, reassess.

job families

grouping of related jobs that require different skills and responsibility levels

hr strategy

hr systems will be most effective when roles are designed to allow employees to be involved in decisions that have an opportunity to make an impact

incentive pay

tie pay increases directly to performance, bonus, quarterly bonus, not guaranteed.

fair labor standards act

- A federal law governing minimum wage, over time pay, equal pay for men and women in the same types of jobs, child labor, and record keeping requirements.

benchmark job

- positions that remain consistent across the industry in terms of salary, responsibilities, seniority, and can therefore be compared across different employers as reference points for making pay comparisons within or without the organization. - A prototypical job, or group of jobs, used as a reference point for making pay comparisons within or without the organization.

claw back

a mechanism by which an employer can recover pay from an executive if it was based on inaccurate financial statements.

comp and ben strategy

a strategic plan for employee compensation determines how much you want to pay employees and what type of employees you want to attract.

job descriptions

a summary of the most important features of a job. It identifies the job and describes the general nature of the work, specific task responsibilities, outcomes, and the employee characteristics required to perform the job.

competency

basic knowledge and abilities employees must acquire or demonstrate in a competency based plan in order to successfully perform the work, satisfy customers, and achieve business objectives.

skill blocks

basic units of knowledge employees must master to perform the work, satisfy customers, and achieve business objectives.

pension and health benefits

big challenge, very expensive, obamacare

base salary

cash compensation that an employer pays for the work performed. Tends to reflect the value of the work itself and ignore differences in individual contributions.

compensable factors

characteristics in the work that the organization values, that helps it pursue its strategy and achieve its objectives; job attributes that provide the basis for evaluating the relative worth of jobs inside an organization. Must be work related, business related, and acceptable to the parties involved.

steps in creating an internal job structure

collect, summarize work content information, determine what to value, assess relative value, translate into structure.

job evaluation

comparison of jobs within an organization

procedural fairness

concept concerned with the process used to make and implement decisions about pay. Suggests that the way pay decisions are made and implemented may be as important to employees as the results of the decision.

competency based pay

core competencies abstract the underlying broadly applicable knowledge, skills and behaviors that form the foundation for success at any level or job in the organization

competency based pay structures

core competencies, competency sets, behavioral descriptors, person-based structure.

lily ledbetter fair pay act

employers can be liable for current pay differences that are a result of discrimination.

Equal pay act

equal pay required for men and women doing "substantially similar" work in terms of skill, effort, responsibility, and working conditions that does not allow sex discrimination in the view of wages

job analysis decisions

establish the purpose, single vs multiple plans, choose among alternative approaches, obtain involvement of relevant stakeholders, evaluate plans usefulness.

validity

examines the convergence of results among sources of data and methods.

pay model

framework for examining current pay systems and a guide for most of this book.

job

group of tasks performed by one person that make up the total work assignment of that person

say on pay provision of the dodd frank act

requires reporting by all public companies on the ratio of ceo pay relative to the median pay of employees.

classification process of job evaluation

series of classes and grades that describe a group of jobs. Each grade in a class will represent different levels of difficulty and responsibility: (adv) efficient grouping under one-system, (disadv) descriptions lead to manipulation

skill based pay structures

skill analysis, skill blocks, certification process, person-based structure.

task

smallest unit of analysis, a specific statement of what a person does; ex. answer the telephone.

merit increases

specifications that tie pay increases to performance. They may take one of two forms: the simplest version specifies pay increases permissible for different levels of performance. More complex guidelines tie pay not only to performance but also to position in the pay range.

pay structure aligned

that there are no internal equity problems, that it is in line with strategies.

pay structures

the array of pay rates for different jobs within a single organization; they focus attention on differential compensation paid for work of unequal worth.

job content

the heart of job analysis; involves the elemental tasks or units of work with emphasis on the purpose of each task.

relational returns

the non quantifiable returns employees get from employment, such as social satisfaction, friendship, feeling or belonging, or accomplishment: Recognition/status, employment security, hard work, learning opportunities.