Compensation (Milkovich) Terms

ability to pay

The ability of a firm to meet employee wage demands while remaining profitable; a frequent issue in contract negotiations with unions; this is constrained by its ability to compete in its product market

ability

an individual's capability to engage in a specific behavior

appeals processes

mechanisms are created to handle pay disagreements- provide a forum for employees and managers to voice their complaints and receive a hearing

across-the-board increases

A general adjustment that provides equal increases to all employees

agency theory

A theory of motivation that depicts exchange relationships in terms of two parties: agents and principals. According to this theory, both sides of the exchange will seek the most favorable exchange possible and will act opportunistically if given a chance. As applied to executive compensation, agency theory would place part of the executive's pay at risk to motivate the executive (agent) to act in the best interests of the shareholders (principals) rather in the executive's own self-interests.

access discrimination

Discrimination that focuses on the staffing and allocation decisions made by employers. It denies particular jobs, promotions, or training opportunities to qualified women or minorities; illegal under Title VII of the Civil Rights Act of 1964.

affirmative action

Firms with government contracts must take affirmative steps to hire women and minorities in proportion to their presence in the labor force.

ADA

Legislation passed in 1990 that requires that reasonable accommodations be provided to permit employees with disabilities to perform the essential elements of a job

ADEA of 1967

Legislation that makes nonfederal employees age 40 and over a protected class relative to their treatment in pay, benefits, and other personnel actions. The 1990 amendment is called the Older Workers Benefit Protection Act.

all-salaried workforce

Pay approach in which not only exempt employees (FLSA), who traditionally are paid a salary rather than an hourly rate, but also nonexempt employees receive a prescribed amount of money each pay period that does not primarily depend on the number of hours worked.

alternation ranking

a job evaluation method that involves ordering the job description alternately at each extreme.