HRM300 CH.10-CH12

recency error

allowing performance, either good or bad, at the end of the review period to play too large a role in determining an employee's rating for the entire period

Halo error

an appraiser giving favorable ratings to all job duties based on impressive performance in just one job function (ex: rater who hates tardiness)

the definition on "Employee Benefits"

are that part of the total compensation package other pay for time worked, provided to employee in whole or in part by employer payments ( e.g. life insurance, pension, worker's compensation).

Central Tendency error

avoiding extremes in ratings across employees

leniency error

consistently rating someone higher than is deserved

First impression error

developing a negative or positive opinion of an employee early in the review period and allowing that to influence all later perceptions of performance

horn error

downgrading an employee across all performance dimensions exclusively because of poor performance on one dimension

what are the 6 Issues Courts Stress

- Courts are favorably disposed to appraisal systems that give specific written instructions on how to complete the appraisal - Organizations tend to be able to support their cases better when the appraisal system incorporates clear criteria for evaluating performance - The presence of adequately developed job descriptions provides a rational foundation for personnel decisions - Courts also approve of appraisal systems that require supervisors to provide feedback about appraisal results to the employees affected - The courts seem to like evaluation systems that incorporate a review of any performance rating by a higher level supervisor - Most importantly, the courts consistently suggest that the key to fair appraisals depends on consistent treatment across raters, regardless of race, color, religion, sex or national origin

Advantages of using Group Incentive Plan

- Positive impact on organization and individual performance of about 5 to 10 percent per year. -Easier to develop performance measures than it is for individual plans. -Signals that cooperation, both within and across groups, is a desired behavior. -Teamwork meets with enthusiastic support from most employees. -May increase participation of employees in decision-making process.

The Employee Preferences/Factors influencing the choice of benefit package

-Equity: fairness historically and in relationship to what others receive. -Personal needs as linked to: Age, Sex, Marital status, Number of dependents.

The Employer Preferences/Factors influencing the choice of benefit package

-Relationship to total compensation costs -Costs relative to benefits -Compensation offerings Role of benefits in: Attraction, Retention, Motivation. -Legal requirements

The elements to consider when designing a gain-sharing plan

-Strength of reinforcement -Productivity standards -Sharing the gains split -----between management and -workers -Scope of the formula -Great care must be exercised -Perceived fairness of the formula -Ease of administration -Production variability

What are the disadvantages of Individual Incentive Plans

1. Greater conflict between employees and managers 2. Interdiction to new technology may be resisted by employees. 3. Reduced willingness of employees to suggest new production methods to fear of subsequent increases in production standards. 4. Equipment is poorly maintain, stopping employees efforts to earn larger incentives. 5. Increased turnovers among new employees 6. Mistrust between workers and management.

What are the advantages of Individual Incentive Plans

1.Substantial impact that raises productivity, lower production costs, and increases earnings of workers. 2.Les direct supervision is required to maintain reasonable levels of output than under payment by time. 3. In most cases, systems of payment by result, if accompanied by improved organizational and work measurement, enable labor cost to be estimated more accurately than under payment by time. This helps costing and budgetary control .

severity error

: rating individuals consistently lower than deserved

Cost effectiveness of Benefits

Cost effectiveness in two situations: 1) Most employee benefits are not taxable, avoids payments of state and federal income. 2)Group benefits- life, health and legal insurance can be obtained at lower cost than could be obtained by the employees acting on their own

What are the section on Promotional Increases as a Pay-For-Performance Tool ?

Effective method of rewarding good performance Promotion accompanied by a salary increase - 8 to 12% Characteristics of promotional pay increases. Size of increment is approximately double a normal merit increase Reward employees for commitment and exemplary performance.

What are the 4 types of Errors by raters when processing information

Errors in Appraising performance : criterion contamination. Errors in observation (attention) Errors in storage and recall Errors in the actual evaluation

What are the difference between the Common Errors in the Appraisal Process

Holo error Horn error First impression error Recency error- Leniency error Severity error Central tendency error Clone error Spillover error

Evaluating Performance: Ranking.

Raters compare employees against each other to: Determine the relative ordering of the group on some performance measure (usually some measure of overall performance)

Evaluating Performance: Ranking Rating formats.

Require raters to evaluate employees on some absolute standard Each performance standard is measured on a scale Standard rating scale: Adjectives are used as anchors Behaviorally anchored rating scales (BARS): Behaviors are used as descriptors

What is a Pay For Performance Plan

Signals a movement: Away from entitlement Sometimes a very slow movement towards a pay that varies with individual or organizational performance

what a Lump-sum Bonus involves (or awards)

Substitute for merit pay. Based on employee/ company performance. Does not build into base pay. Viewed as less of an entitlement than merit pay. Can be considerable Less Expensive than Merit Pay over the long run.

The most frequently used means to communicate benefit information to employees

The employee benefit handbook

Clone Error

giving better ratings to individuals who are like the rater in behavior and/or personality

Spillover error

when employers seek to avoid unionization by offering workers the wages, benefits, and working conditions won in rival unionized firms