Compensation Mgt Quizam 1: Chapters 1-6
Identify the main sources of job analysis data
job holders + supervisors (and or anylysts)
Identify the factors that combine to form the basis for job evaluation
- organizational culture - job content - the external market - value to org. - skills required
what are the consequences of an internally aligned structure?
- reduced pay-related work stoppages - increased experience - reduced pay-related grievances
Identify the ways in which compensation affects the success of managers?
- it is a major expense that must be manages - it is a major factor determining employee attitudes and behaviors and thus organization.
Which of the following requirements should be met by an organization's pay structure?
- it should be fair to employees - employees should be able to view the way in which their work is linked to the work of the other's and the organization's objectives
How compensation systems might be tailored to three general business strategies
1. Innovator 2. Cost-cutters 3. Customer-focused
Arrange the units of job analysis according to size, starting with the smallest
1. Task 2. Position 3. Job 4. Job family
Arrange the steps involved in the determination of an internally aligned job structure in the order in which they occur
1. job analysis 2. job description 3. job evaluation
Identify the similarities between google, Nucor, and Merrill Lynch in terms of compensation strategies.
- All three formulate their pay strategy in a way that supports their business strategy - All three give importance to outstanding employee performance and commitment
According to the AMO theory, when will HR systems be most effective?
- When employee ability is enhanced through selective hiring and training and development - When roles are designed to allow employees to participate in decision making and have an opportunity to make an impact and when the compensation system encourages employees to act on their abilities and utilize the opportunity to make a difference
Identify the factors that influence the formulation of compensation strategies
- employee & union preferences - A company's culture and values - Social and political context
Identify the strategic choices involved in tailoring a pay structure that is internally aligned
- how specific the tailoring of their pay structure should be to the organization's design + work flow - how pay should be distributed through the levels in the structure
Merit increases
- increments to base pay and are based on performance - Merit payments are based on an assessment or rating of recent past performcance
Arrange the steps involved in developing a total compensation strategy in the order which they are conducted
1. Assess total compensation implications 2. Map a total compensation strategy 3. Implement strategy 4. Reassess
Total Compensation Strategy:
1. Assesses total compensation implications 2. Map a total compensation strategy 3. Implement strategy 4. Reassess
Steps to a Point Plan:
1. Conduct job analysis 2. Determine compensable factors 3. Scale the factors 4. Weight factors by importance 5. Select criterion pay structure 6. Communicate and train users 7. Apply to remaining jobs 8. Develop online support
while designing a point plan, arrange the steps that are conducted after job analysis in the order in which they occur
1. Determination of compensable factors 2. scaling of compensable factors 3. weighing of compensable factors according to importance 4. selection of criterion pay structure 5. communication of the plan and training users 6. applying the plan to non benchmark jobs and developing online software support
Four Policy Choices
1. Internal alignment 2. External Competitiveness 3. Employee contributions 4. Management
Job Analysis:
A systematic method to discover and describe similarities and differences among jobs
According to Boxall and Purcell, the ____ ____ is an increasingly common "very basic theory of performance" that bases performance on ability, motivation, and opportunity
AMO Theory
Compensation
All forms of financial returns and tangible services and benefits employees receive as part of an employment relationship.
Match the ways of ranking (Alternation ranking and paired comparison) while evaluating jobs w/ their descriptions
Alternation ranking: Evaluators reach a consensus on which jobs are the most and least valuable, followed by the next most and least valued, and so on until all the jobs have been arranged in order Paired comparison: evaluators use a matrix to compare every possible coupling of jobs
Which of the following is a difference between layered and delayered pay structures?
As opposed to the layered structure, employees are given more freedom and responsibility in the delayered structure
_______ _______ is the cash compensation that an employer pays an employee for the work performed.
Base wage
Identify a similarity between merit increases and merit bonuses
Both are based on a performance rating
How do most organizations motivate employees to apply for higher-level positions?
By associating promotions with money
Which of the following come from the basis for a cost of living adjustment to base wage?
Changes in living cost, experience or skill, changes in what other employees are paying for the same work
_____ refers to all forms of financial returns and tangible services and benefit empployee's receive as part of an employment relationship
Compensation
What does compensation mean to managers?
Compensation influences managers success in two ways: - Major expense that must be managed - Major determinant of employee attitudes and behaviors
The business strategy of Orient inc. a clothing company, involves providing customers w/ clothes at prices lower than those of their competitors. Which of the following would be an important compensable factor for this company?
Cost containment
Match the types of data collected for job analysis w/ their categories
Data related to job: work identification Data related to employee: Internal and external relationships
Which test of compensation strategy is the most difficult?
Determining whether it adds value
The pay differences among levels are referred to as ________.
Differentials
Identify an aspect of compensation that may be viewed as a measure of justice in society?
Earning differentials between women and men
Match the compensation objectives
Efficiency: Improving performance and quality, pleasing customers and stockholders and keeping labor costs under control Fairness: Equitable treatment of all employees through the recognition of employee contributions and needs Compliance: Conforming to federal and state compensation laws and regulations
Marginal productivity:
Employees pay use value
Management
Ensuring that the right people get the right pay for achieving the right objectives in the right way
which compensation objective has a company failed to meet if it misuses the statistics used to measure competitors' pay rates?
Ethics
______ ______ refers to pay comparisons w/ competitors
External competitiveness
Quantitative job analysis:
Facilitates statistical analysis of results, allowing faster data collection
Administering and Evaluating the Plan:
Fairness in the plan's administration Availability of sufficient information Adequate communication and employee involvement
True or False: Alignment is probably the most difficult test that a pay strategy has to pass
False
True or false: Union reps who actively participate in the design of internal structure believe that collective bargaining yields more equitable results
False
Strategic perspective
Focuses on those compensation choices that help the organization gain and sustain competitive advantage
Match the companies w/ their strategies for internal alignment
Google: It minimizes hierarchy and stresses collaboration Nucor: Provides several opportunities but no defined career paths Merrill Lynch: It sizes jobs based on knowledge/skill, complexity, business impact, and strategic value
Which of the following would be considered a measure of success of the training provided to users to help them apply a point plan?
High (inter) rater reliability
_____ ___ - the education, experience, knowledge, abilities, and skills required to perform the work is a major influence on internal structures
Human capital
Job Data:
Identification
In which of the following situations should an organization's internal structure be redesignes?
If it does not motivate employees to work towards achieving the organizations objective
Wall street financial services firms and banks rewarded employees for developing "innovative" new financial investment vehicles and for taking risks that helped them and their firms earn a significant amount of money by using...
Incentive plans
Which theory sees organizations as responding a conforming to normative pressures in their environments in order to gain legitimacy and to minimize risk?
Institutional theory
_____ _____ refers to the pay relationships among different jobs or skills competencies w/in a single organization
Internal Alignment
____ ____ is the policy that refers to comparisons among jobs or skill levels inside a single organization
Internal alignment
Match the types of internal structure alignment (int. align. based on content and int. align. based on value) with their features
Internal alignment based on content: it organizes jobs based on the requires skills and associated duties and responsibilities Internal alignment based on value: It organizes jobs based on the relative contribution of the skills, duties, and responsibilities of each job to the organization's goals
Which of the following is true of Nucor steels corporate mission?
It believes in achieving success by working together
Why has Nucor Steel done well despite paying its workers higher than companies inside and outside the steel industry?
It has much higher productivity than is usually seen in the steel industry
which of the following is a possibility if managers and employees are not involved in designing the internal pay structure
It may be easier for them to imagine ways the structure might have been rearranged to their personal preferences
Identify a true statement about the compensation strategy at google
It offers its employees significant stock programs
Which of the following makes a company's compensation strategy difficult to imitate?
Its alignment within the overall HR strategy
the first step in designing a point plan is ______.
Job analysis
A job summary that can be used to make HR decisions is called a(n) ______ ______
Job description
Job Specification:
Knowledge, skills, and abilities necessary to perform the job
Identify common examples of income protection benefits provided by employers
Life insurance, retirement programs, medical insurance
Supply chain analysis:
Looks at how an organization does its work
Which of the following means ensuring that the right people get the right pay for achieving the right objectives in the right way?
Management
identify the types of jobs for which every point plans, such as the National Metal Trades Association (NMTA) plan and the National Electrical Manufacturers Ass. (NEMA) plan, were developed
Manufacturing jobs + office jobs
_______ _______ is a theory that was put forth in the last half of the 19th century and that countered the views of Karl Marx by stating that employers pay use value
Marginal productivity
Delayering:
May cut an entire level of work
Increments to base pay that are given to employees one the basis of their performance are known as....
Merit increases
Match the companies by their compensation strategy maps
Microsoft: total compensation is given prominence SAS: Total compensation supports work/life balance
Which of the following are forbidden by equal employment legislation in the U.S. from serving as the criteria for setting pay differentials?
National origin, religion, gender, and race
How does compensation influence employees?
Pay can influence employee motivation and behavior in 2 ways: - incentive effect - sorting effect
Vicious Circle:
Pay for performance is a downward momentum and continuous difficulties
Virtuous circle:
Pay for performance is at an upward momentum and continuous improvement
_____ ______ refers to the array of pay rates for different work or skills w/in a single organization
Pay structure
which method of job evaluation has compensable factors whose degrees are numerically scaled and whose relative importance is weighed in the determination of job structure?
Point metjod
What are Porfyra and Colina Manufacturing's internal structures?
Porfyra: Hierarchical structure Colina: Egalitarian structure
Employee Data:
Position analysis questionnaire
____ ____ refers to the process used to make pay decisions and suggests that the way a pay decision is made may be equally as important to employees as the results of the decision.
Procedural fairness
Match the sources of fairness of a pay structure w/ their meanings
Procedural justice: The method used for determining a pay structure Distribution Justice: A pay structure itself
Job Evaluation:
Process of systematically determining the relative worth of jobs to create a job structure for the organization. The evaluation is based on a combination of job content, skills, value to the organization.
People who support the idea of adopting best practices in developing a pay strategy feel that this ______
Provides the employer with preferential access to superior employers
In order to collect job information, employees may be directed to a website where they fill in an online questionnaire. The approach is known as _____ ______ _____ (QJA)
Questionnaire job analysis
Job Evaluation Methods:
Ranking Classification Point method
Match the common job evaluation methods ( ranking and classification and point) w/ their advantages
Ranking: It's quick, simple, and easy to explain Classification: A wide range of work can be grouped together in a single system Point: the basis for comparisons is determined by compensable factord
External competitiveness
Refers to pay comparisons with competitors - Have twofold effect on objectives: 1. To ensure that the pay is sufficient to attract and retain employees 2. To control labor costs so that the organization's prices of products or services can remain competitive in a global economy
Pay Structure:
Refers to the array of pay rates for different work or skills within a single organization.
Distributive Justice:
Refers to the fairness of the decision
______ is a measure of the consistency of results among various job analyst, various methods of job analysis, various sources of data, or overtime
Reliability
Job-based Structure:
Relies on the work content- tasks, behaviors, responsibilities
Best Practices:
Results in better performance with almost any business strategy
Task Data:
Reveals the actual work performed and its purpose or outcome
Which of the following do most unions demand as a way to promote solidarity among members?
Seniority-based promotions + small pay differences among jobs
Person-based Structure:
Shifts the focus to the employees skills, knowledge, or competencies
Skill-based pay:
Shows up in manufacturing, where the work involves teams, multiskills, and flexibility
Identify the ways in which pay can influence employee motivation and behavior?
Sorting effect & incentive effect
Outsourcing:
Specialists are paid based on the internal structure of their home employer
Long-term incentives are usually in the form of?
Stock ownership
____ refers to the fundamental directions that an organization chooses
Strategy
Customer-focused business strategy
Stresses delighting customers and bases employee pay on how well they do this
Cost-cutter efficiency focused strategy
Stresses doing more with less by minimizing costs, encouraging productivity increases, and specifying in greater detail exactly how jobs should be performed
Innovator
Stresses new products and short respond time to new market trends
Line of Sight:
Structure must be fair to employees
Match the job analysis terms (Task, Job, Job family) w/ their examples
Task: Analyzing data Job: Content developer Job family: clinical research
Job Description:
Tasks, duties, and responsibilities that make up a job
Base wage
The cash compensation that an employer pays in return for the work performed
Validity:
The degree the evaluation assesses relative job worth Degree of agreement between Hit rates
Strategy
The fundamental directions an organization chooses - defines its strategy through the trade offs it makes in choosing what to and not to do
Workflow:
The process by which goods and services are delivered to the customer
Which of the following factors are likely to influence the number incumbents per job from which to collect data?
The stability of the job and the ease of collecting the info
Use Value:
The value of goods/ services an employee produces in a job
Exchange Value:
The wage agreed upon by the employer and employee
Value:
The worth of the work (the relative contribution of a job to the organization aims)
The business units at United technologies follow different compensation strategies b/c?
They faced varied competitive conditions
Why do some stockholders support the use of stock to pay employees?
They feel that it creates a sense of ownership among employees that will improve performance
Why are some people against the idea of viewing pay as an investment w/ measurable returns?
They feel that this view reduces the importance of treating employees equitably
Which of the following is true of the income protection benefits provided by employers?
They help protect employees from the financial risks inherent in daily life
which of the following is true of allowances?
They often grown out of whatever is in limited supply
Identify the examples of programs that help employers balance their work and personal responsibilities
Time away from work, access to services to meet specific needs, flexible work arrangements
Mark's an employee at a multinational technology company. In addition to receiving a comfortable base wage, he receives a pension and medical insurance. He also enjoys employment security and receives recognition for his work.
Total compensation: Pension + medical insurance Relational returns: Employment security recogonition
According to ______ _____, players will play better in a tournament where the prize differentials are large than in a tournament where the prize differentials are small
Tournament theory
True or false: The job content identified by job analysis is used to describe and evaluate work
True
What is the first step in formulating a total compensation strategy?
Understanding business strategy and competitive dynamics
Employee contributions
Understanding the basis for judging performance, helps percieves pay as fair - Important policy decision because it directly affects employees' attitudes and behaviors - team incentives
_____ examines the convergence of results among sources of data and methods
Validity
Match the companies w/ the flexible benefits they offer their employees
Whole foods: employees vote on the benefits of their choice Netflix: Employees can select the mix of stock options and salary General Mills: Employees are allowed to exchange several needs salary for stock awards
Content:
Work performed in a job and how it gets done
Compliance
as a pay objective means conforming to federal and state laws and regulations
How do employees Judge the equity of their pay?
by making several comparisons
In the ______ method of job evaluation, a series of well-described classes covers the range of jobs in an organization, and a job description is compared to the class descriptions to decide which class is the best fit for that job
classification
what is the best way to deal with discrepancies in job analysis data?
collect more data
characteristics in the work that organization values, and those that help it pursue its strategy and achieve its objectives are called _____ ______
compensable factors
________ refers to all forms of financial returns and tangible services and benefits employees receive as part of as employment relationship
compensation
After the determination of factor weights by an advisory committee members recommend the _____ ____ ____, that is a pay structure they wish to duplicate w/ the point plan
criterion pay structure
The ____ ____ business strategy places emphasis on pleasing customers and bases employee pay on how well they do this
customer-focused
A major work decision change is ______, in which entire levels of work are removed
delayering
Job analysis is useful if it can ______ in a reliable, valid, and acceptable manner
determines similarities and differences among jobs
What are the objectives of the compensation strategy followed at google?
emphasis on innovation, recognition of contributions, committed to cost containment
The importance given to employee contributions is a significant policy decision because it directly affect _____.
employee's attitudes and work behaviors
The Americans with Disabilities Act (ADA) requires that ______ ______ of a job --- those that cannot be reassigned to other workers -- must be specified for jobs covered by the legislation
essential elements
True or False: Not all organizations that pay people have a compensation strategy
false
True or false: verification of a job description involves only the job holders supervisors
false
true or false: tradition does not influence whether or not the compensable factors used to slot jobs into the pay structure are accepted
false
The occupational info network, or O&*NET, is an easily accessible source of ____ that can be used during job analysis
generic job descriptions
Stockholders who are not a favor of using stock to pay employees believe that ...
granting employees too much ownership dilutes stockholder wealth
A characteristic of any pay structure is its
hierarchical nature
The final result of the job analysis --- job description- job evaluation process is a ______.
hierarchy of work
Sorting effect
higher pay levels help organizations attract more high-quality applicants, allowing them to be more selective in their hiring. May improve employee retention.
In the point method of job evaluation, different factor weights indicate differences in.....
importance attached to each factor by the employer
Identify a true statement about the application of a point plan ti non benchmark jobs
it can be done by people who were not necessarily involved in the design process
identify the products of job analysis
job description and job specification
In the 14th century western Europe, the Christian church endorsed a(n) ____ ______ _______ that denied market forces such as skills shortages as appropriate determinants of pay structure
just wage doctrine
A drawback of the ranking method of job evaluation is that evaluators using this method must ______.
know about every single job under study
Which of the following is likely if a company pays its employees based on performance?
low turnover
Cost of Living Adjustment (COLA)
made to base pay on the basis of changes in: - What others are paying, living costs, or experience/skill
In a survey of approximately 1,000 members of world at work was selected by the majority as the primary method of job evaluation
market pricing
identify a true statement about the factor scales constructed in the point method of job evaluation
most factor scales consist of four to eight degrees
A disadvantage of egalitarian pay structure is that they may result in a ____--
negative sorting effect
In the context of compensation, which of the following is a way better satisfy employees individual needs and preferences?
offering more choice
_______ refers to the movement of jobs to locations beyond a country's boarders
offshoring
AMO Theory
p=f(A,M,O) - p is performance - A is ability - M is motivation - O is opportunity - HR systems will be most effective when roles are designed to allow employees to be involved in decisions to have an opportunity to make an impact
Incentive effect
pay influences individual and aggregate motivation
Internal alignment
refers to comparisons among jobs or skill levels inside a single organization - jobs and people's skills are compared in terms of their relative contributions to the business objectives
Salary
refers to the pay for employees who are EXEMPT from regulations of the Fair Labor Standards Act (FLSA) and hence do not receive over pay
Relational returns from work: Procedural Fairness
refers to the process used to make pay decisions. It suggests that the way a pay decision is made may be equally as important to employees as the results of the decision
In the United States, the pay for employees who are exempt from regulations of the Fair Labor Standards Act (FLSA) and hence do not receive overtime pay is referred to as...
salary
Pay structures undergo changes due to external factors such as _____
skill shortages
identify the aspects of job content whose values depend on their relationships to market wages
skills required + customer contacts
Identify a true statement about the stability of jobs and currency of job information
some jobs remain relatively stable over time
A ___ ___ focuses on those compensation choices that help the organization gain and sustain competitive advantage
strategic perspective
Who performs job analysis in present times?
supervisors and human resource generalists
______ ______ ____ looks at the way in which an org. does its work: activities pursued to accomplish specific objectives for specific customers
supply chain analysis
______ ______ reveal the actual work performed and its purpose or outcome
task data
The reassessment step in formulating a total compensation strategy recognizes that ______
the compensation strategy must undergo modifications in response to changing conditions
the level at which job analysis begins influences _______
the extent of similarity or dissimilarity between jobs
what is the advantage of conventional questionnaires and interviews?
the involvement of employees improves their understanding of the process
Identify a difference between layered and delayered pay structures
the layered structure is more hierarchical than the delayerd structure
Which of the following does job content emphasize?
the purpose of each elemental task or unit of work
Performance-based pay is most effective when ______
there is success to share
Which of the following are true of aligned pay structure
they support the way work gets done and they are fair to employees
What are the pay objectives followed at merrill lynch
to hire, motivate, and retain the best talent
why is a manual prepared after a job evaluation point plan is designed?
to permit users who were not involved in the plans development to apply the plan as its developers intended
True or false: Flexible and balanced guidelines are necessary to ensure efficient job evaluation
true
True or false: job context does not have intrinsic value if its value depends on what it can command in the external market
true
Identify a common example of a characteristic that is usually present in a limited number of jobs but is made into a compensable factor and applied to all jobs
unpleasant working conditions
______ refers to the practicality of the collected info.
usefulness
Identify the ways in which the reliability of job analysis data can be improved
using multiple raters and providing more training
The process by which goods and services are delivered to the customer is referred to as ______ ______
work flow
Unlike Microsoft's compensation strategy, SAS institutes approach to compensation emphasizes ______.
work/life programs
Identify the true statements about whole foods business objectives
- to take extraordinary measures to satisfy and delights customers - to hire and try to retain employees who are going to help the company make money
Identify the conditions under which jobs are susceptible to outsourcing
- when the work can be routinized - when the electronic transmission of inputs and outputs is simple - when only limited interaction of the collected information
Which of the following features of research should be kept in mind while deciding the usefulness and relevance of a research study?
- whether the research separates correlation from causation - whether there are alternate explanations - whether the research is useful
which of the following can form the basis for a cost of living adjustment (COLA) to base wages?
Changes in experiences or skill and changes in what other employers are paying or the same work
Identify a true statement about relative compensation costs and productivity rates across nations
Countries like Mexico and China have much lower hourly compensation rates than the U.S.A
How are efficiency, fairness, and compliance affected by internal alignment policies?
Efficiency: it's influenced by employees motivation to choose increased training and more responsibility in dealing with customers Fairness: Its influenced by employees comparisons of their pay to pay of other employers in an organization. Compliance: It's influenced by the basis used while making internal comparisons among employees
Match the factors (External and organizational) that shape the internal structure of an organization w/ their examples
External Factors: Economic pressures and gov't policies, laws and regulations Organizational factors: strategy, technology, human capital
What shapes Internal Structures?
External factors Organization factors
Match the types of factors (external and internal factors) that affect the pay for jobs w/ the types of jobs they influence
External factors: Entry Internal: Non entry
True or False: Cost of living adjustments to base wages are becoming increasingly common nowadays
False
Identify a draw back of egalitarian pay structures
High-performing and more skilled employees may feel unpaid
Match the types of cash compensation with their aims
Incentives --> explicitly attempt to influence future behavior reward a past behavior which is helped to ....
_____ _____ _____ refer to the rules and procedures that determine the pay for the different jobs within a single organization and allocate employees among those different jobs
Internal labor markets
Reliability:
Is a measure of the consistency of results among various analysts, various methods, various sources of data, or over time
Source of Competitive Advantage: Three Tests
Is it aligned? Does it differentiate? Does it add value?
Mach the products of job analysis (Job description & Job specification) w/ their definitions
Job description: the list of tasks, duties, and responsibilities included in a job Job specification: the list of knowledge, skills, abilities, and other characteristics that an individual must possess to perform the job
Match the types of work-related internal structures w/ their areas of focus
Job related structures: focus on what people are doing and the anticipated outcomes Skill and competency based structures: focus on the person
The _____ _____ _____ (PAQ) groups work info into seven basic factors: info input, mental process, work output, relationships w/ other persons, job context, other job characteristics, and general dimensions
Position analysis questionnaire
Match the universal compensable factors employed by the hay group method w/ the dimensions that are included in them
Problem solving: Environment and challenge Accountability: Freedom to act and impact
Offshoring:
Refers to the movement of jobs to locations beyond a country's borders
Internal Alignment(internal fairness/equity)
Refers to the pay relationships among different jobs/skills within a single organization
Procedural justice:
Refers to the process by which a decision was reached
Best fit:
Reflects the company's strategies and values, globally competitive
which of the following are true of the perspective of researchers who make pay decisions based on job evaluation?
- they view job evaluation as a method that helps pay differences among jobs get accepted - they believe that job evaluation allows the exchange of views
Incentives
- tie pay increases to performance - are a one- time payment which differs from merit adjustments (so they don't permanently increase labor costs) - may be long-term (stock ownership, or stock options) or short-term - frequently referred to as variable pay
External and Organization factors influence a company's internal structure, what are the examples for both of these?
External factors: stakeholders, and cultures and customs Organization factors: HR policy, employee acceptance, and cost implications
True or false: A present-value perspective focuses on the value of a company's initial offers to job applicants
False
True or false: organizations commonly use an established approach to derive a single internal structure that can be applied to different functional groups or units.
False
Recognition and status, employment security, challenging work, and opportunities are examples of ________
Relational returns
Job losses or gains in a nation over time are partly influenced by_____ across
Relative labor costs and productivity
Relational Returns
- Psychological - (learning opportunities, status, challenging work)
Identify the functions that a job evaluation must perform
- it should encourage behavior that supports org. obj. - it should support org. strategy and work flows - it should be fair to employees
What did Matt Bloom discover about the effect of pay differences on performance-based on 8 years of data on major league baseball?
Teams with small differences in member salaries did better than those w large differentials
True or false: professional or managerial job descriptions should include the relationship between the job, the person performing it, and the org. objectives
true
In which of the following ways can employees view compensation?
- As an entitlement for being an employee of the company - As a return in an exchange between their employer and themselves - A reward for having done well in a job - As an incentive to take or stay in a job and try ti perform well in that job
Merit bonuses
- Based on performance rating - Paid in the form of a lump sum rather than becoming a permanent part of the base salary
Identify examples of information that helps in identifying a job
- the number of people employed in a job - whether a job is exempt from the fair labor standards act - job departments - job traits
Identify the aspects of the pay model that influence the impact of any internal structure on organization performance
management, contributions, competitiveness
Total compensation
pay received directly as cash and indirectly as benefits
Conventional job analysis:
- Developing preliminary information - Interviewing jobholders and supervisions - Using the information to create and verify job description
Benefits
- Income protection- medical insurance, retirement programs, life insurance, saving plans - Work/Life balance- includes time away from work, access to services, and flexible work arrangements - Allowances often grow out of short supply
Identify the characteristics of a benchmark job
- It employs a reasonable proportion of the work force - its contents are well known and relatively stable over time
Identify the ways in which compensation affects the success of managers
- It is is a major factor determining employee attitudes and behaviors and thus, organization performance - it is a major expense that must be managed
In the context of pay structures, a(n) ____ - _____ ______ focuses on the skills, knowledge, or competencies possessed by an employee, whether or not they are utilized in the employee's particular job
person-based structure
Identify the provisions of the Dodd-Frank Wall street reform and consumer protection act
- Say pay that makes it obligatory for public companies to submit their executive compensaiton plan to a vote by shareholders - Clawback provisions designed to allow companies to take back compensation from executives in some instances
What does compensation mean to society?
- Some people see pay as a measure of justice - Job losses (or gains) in a country is partly a function of labor costs (and productivity)
What does compensation mean to stockholders?
- Some stockholders say using stock to pay employees creates a sense of ownership. - Stockholders have a interest in executive pay
Identify the true statements about incentives
- They are one time payments - They are often known as variable pay
Arrange the steps involved in the conventional job analysis procedure developed by the U.S fed gov't in the order of their occurrence
1. develop preliminary job info 2. conduct initial tour of work site 3. conduct interviews 4. conduct second tour of work site 5. consolidate job info 6. verify job description
Identify the true statement about a company's strategic compensation map
- It provides a visual reference of the company's compensation system - It can elucidate the message that the company is trying to deliver w/ its compensation system
What does compensation mean to employees?
- Pay is usually a major source of financial security - Employees may see compensation as- entitlement, incentives, and rewards
Total earnings opportunities: Present value of a stream of earnings
- Present value of a stream of earnings - returns from work - A network of returns - A present-value perspective shifts the comparison of today's initial offers to consideration of future bonuses, merit increases, and promotions
why is it important to maintain some documentation to support the choice of compensable factors while developing a point plan?
- it can with stand a variety of challenges to the pay structure - it helps gain acceptance by employees and managers - its easier to understand
Identify the major uses of job analysis in compensation
- it helps establish an internal job structure that is fair and aligned - it identifies similarities and differences in the work contents of a jobs.
