9. pay structure

Question 1

pay from employer pov

Answer 1

motivational, aligns interest

Question 2

pay from employee pov

Answer 2

standard of living and status

Question 3

key concept in pay structure

Answer 3

pay level (avg pay) and job structure (relative pay)

Question 4

equity theory

Answer 4

employees compare their output/input ratio to others

Question 5

developing pay levels

Answer 5

market pressures (product market and labour market competition)
efficiency wage theory
market pay surveys (benchmark)

Question 6

developing job structure

Answer 6

job evaluation (experience, education, complexity) -> point-factor theory

Question 7

developing pay structure

Answer 7

market survey data (external equity)
pay policy line (internal equity)
pay grades (jobs are grouped in pay grades)

Question 8

market survey data

Answer 8

key jobs -> market survey data
non-key jobs -> point-pay regression

Question 9

globalisation

Answer 9

expatriate pay and geographic pay differentials

Question 10

monitoring compensation cost

Answer 10

compa-ratio = actual pay / pay midpoint

Question 11

challenges with job-based pay structure

Answer 11

bureaucracy “its not on my job description” effect
lack of adaptability

Question 12

solution to job-based pay structure

Answer 12

delayering
skill based pay

Question 13

skill based pay challenges

Answer 13

• find utility to new skills acquired
• employee that “top-out”
• training and certif
• how to price combo of skills

Question 14

excessive executive pay

Answer 14

trust gap and customer dissatisfaction

Question 15

regulation

Answer 15

EEO (equal employment opportunity)
min wage laws