Chap 9 Compensation Flashcards
Definition of compensation
Cash and non cash reward employees receive for their work
7 areas that impact the pay system of an organization
What are the 7 objectives of compensation
What are the 5 major phases of compensation Managment
- Job analysis
- Job eveluation
- wage and salary survey
- Pricing jobs
- Match
3 componants of job evaluation
- Position description
- Job description
- Job Standard
definition of job evaluation
The systematic process of assessing job comtent and ranking jobs according to a consistent set of job characteristics and worker traits. The purpose of job evaluation is to determin which job should be paid more than others. It provides for internal equity
What are the 3 methodes for job evaluation
- Job Ranking
- Job grading/ Job classification
- Point System
Definition of job ranking
It is the simplest and least precise methode of job evaluation in which jobs are ranked subjectively according to their worth to the organization
What is the definition of Job grading / Job classification
It is a form of job classification that assignes jobs to predetermined job classification according to their relative worth to the organization.
Definition of the point system
It is a form of job evaluation that assesses the relative importance of the job key factors in order to arrive at the relative worth of the job.
What are the 6 steps needed to implement the point system job evaluation
1) Determin the compensable factors : skills, effort…
2) determin levels of degree of factors
3) Allocate points to subfactors. This reflects the relative importance of each sub factor
4) Allocate points to levels. Allocate points accross each row to reflect the importance of different levels
5) Dvt the point manuel. It containes a job explanation of each job elemant
6) Apply the point system
What is a wage and salary survey
It is a study made of wage and salaries paid by other organizations within the employer’s labour market
Definition of internal equity
Perceived equity of pay in an organization
definition of external equity
Perceived fairness in pay compared to what other employeers are paying for the same type of work
What are the 5 sources of compensation data
- Human Resource and Skill Development Canada (HRSDC)
- Labour Canada
- Employer Association
- Private consultant
Definition of Pay Range
A series of steps or levels within a pay grade, usualy based on year of service
What is the definition of Broadbanding
Reducing the number of salary grades and ranges into just a few levels or bands, each of which then contains a relatively wide range of jobs and salary levels
What is the definition of Merit Raise
A pay increase given to individual workers according to an evaluation of their performance
Definition of Match
grouping of the different pay levels into a structure that can be managed
What are the 4 challanges affecting compensation
- Flat rate
- Compas-Ratio
- Red circle pay rate
- Gov Constraints
Definition of flat Rate
Exeptional performance cannot be rewarded. To give the worker a merit increase requiers moving the employee to a higher job class. this upsets the entier balance of internal equity dvt
Definition of Compa-Ratio
an indicator of how the salary of an employee relates to the midpoint of the relevant pay grade.
Definition of red circle pay rate
Rate of pay above the maximum pay range
What does “equal pay for work of equal value” means?
the principle of equal pay for men and women in job with comparable content. It goes beyond equal pay for equal work.
What is pay equity
It is the policy used to enforce the equal pay for work of equal value principle
Definition of equal pay for equal work
The principle or policy of equal rates of pay for all employees in an establishment performing the same kind and amount of work, regardless of sex, race, or other characteristics of individual workers not related to ability or performance.
What are the 7 reasonable factors that justify differences in wage ?
- Performance rating
- Seniority
- Red circling
- Rehabilitation assignment
- Demotion
- Wage reduction
- Tamporary training position
Definition of incentive pay
Compensation that is directly tied to an employee’s performance and/or productivity Incentives can be individual or team based.
What are the 5 Individual incentive options
What are the 4 commission plan possible
What are the 5 possible team based incentives
What are the benefits of the incentive system
What problems are caused by incentive plans
