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HR > Ch 9 > Flashcards

Ch 9 Flashcards

1
Q

What Is Compensation

A

direct compensation, Indirect compensation, Nonfinancial compensation, Total rewards

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2
Q

Direct compensation

A

encompasses employee wages and salaries, incentives, bonuses, and commissions

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3
Q

Indirect compensation

A

comprises the many benefits supplied by employers

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4
Q

Nonfinancial compensation

A

includes employee recognition programs, rewarding jobs, organizational support, work environment, and flexible
work hours

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5
Q

Total rewards

A

captures all three components, plus other aspects of organizational rewards, including career advancement/developmental opportunities, recognition, work-life balance, and job security

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6
Q

Strategic Compensation

A

the compensation of employees in ways that enhance motivation and growth while at the same time aligning their efforts with the objectives, philosophies, and culture of the organization

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7
Q

Linking compensation to organizational objectives

A

an integral way of attracting talented candidates is offering a standout compensation package

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8
Q

Motivating employees through compensation

A

expectancy theory (employees should exert greater work effort if they have reason to expect that it will result in a reward that is valued) and equity theory (explains how people respond to situations in which they feel they have received less [or more] than they deserve)

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9
Q

The Bases for Compensation

A
  • Hourly work
  • Piecework: work paid according to the number of units produced
  • Employment practices are a provincial jurisdiction, and each province has its own employment standards act
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10
Q

Determining Compensation - Internal Factors

A
  • Compensation/pay strategy
  • Job evaluation
  • Merit raises
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11
Q

Determining Compensation - External Factors

A
  • Supply and demand for qualified labour within an area
  • Wage survey data
  • Consumer price index (CPI)
  • Escalator clauses
  • Real wages
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12
Q

Consumer price index (CPI)

A

a measure of the average change in prices over time in a fixed “market basket” of goods and services

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13
Q

Escalator clauses

A

clauses in collective agreements that provide for quarterly cost-of-living adjustments in wages, basing the adjustments on changes in the CPI

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14
Q

Real wages

A

wage increases larger than rises in the CPI, that is, the real earning power of wages

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15
Q

Job evaluation

A

a systematic process of determining the relative worth of jobs to establish which jobs should be paid more than others within an organization

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16
Q

Job ranking system

A

the simplest and oldest system of job evaluation by which jobs are arrayed on the basis of their relative worth

17
Q

Job classification system

A

a system of job evaluation in which jobs are classified and grouped according to a series of predetermined wage grades

18
Q

Point system

A

a quantitative job evaluation procedure that determines the relative value of a job by the total points assigned to it
- permits jobs to be evaluated quantitatively on the basis of compensable factors

19
Q

Job Evaluation for Management Positions

A
  • Point plans
  • Hay profile method
20
Q

Hay profile method

A

a job evaluation technique using three factors— knowledge, mental activity, and accountability—to evaluate executive and managerial positions

21
Q

The Compensation Structure

A

The evaluated worth of each job in terms of its rank, class, points, or monetary worth must be converted into an hourly, daily, weekly, or monthly wage rate

22
Q

Wage and salary survey

A

a survey of the wages paid to employees of other employers in the surveying organization’s relevant labour market
- permits an organization to maintain external equity
- only key jobs are used

23
Q

Wage curve

A

a curve in a scattergram representing the relationship between the relative worth of jobs and wage rates

24
Q

Pay grades

A

groups of jobs within a
particular class that are paid the same rate

25
Q

Rate Ranges

A
  • Rate ranges that are proportionately greater for each successive grade provide a greater incentive for employees to accept a promotion to a job in a higher grade
26
Q

How are rate ranges divided

A

divided into a series of steps that permit employees to receive increases up to the maximum rate for the range on the basis of merit or seniority or a combination of the two

27
Q

Red circle rates

A

payment rates above the maximum of the pay range

28
Q

Broadbanding

A

collapses many traditional salary grades into a few wide salary bands

29
Q

Competency-based pay

A

pay based on an employee’s skill level, variety of skills possessed, or increased job knowledge
- Organizations will grant an increase in pay after each skill or knowledge has been mastered

30
Q

Government Regulation of Compensation

A
  • Canada Labour Code and the Canada Labour Standards
    Regulations set minimum labour standards for all employees and
    employers in works or undertakings that fall within federal jurisdiction
  • Collective agreements are permitted to override the provisions of these acts
31
Q

groups exempt from overtime requirements

A

Particular groups, including lawyers, doctors, engineers, and managers

32
Q

Significant Compensation Issues

A
  • Pay equity
  • Wage-rate compression
  • pay transparency
33
Q

Pay equity

A

equal pay for work of equal value

  • Organizations must inspect any differences in compensation between positions of equal value held in the majority by women compared to jobs held mainly by men
34
Q

Wage-rate compression

A

compression of differentials between job classes, particularly the differential between hourly workers and their managers

35
Q

Pay transparency

A

the ability for employees to be made aware of what other employees in their workplace are earning

HR (10 decks)

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