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HR management > Chapter 11 > Flashcards

Chapter 11 Flashcards

1
Q

Total Rewards in HR includes what 5 things?

A
  1. compensation
  2. benefits
  3. work-life balance
  4. performance management
  5. Talent management
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2
Q

compensation provided by an organization can come two ways. what are those ways and how do you get the money.

A

directly (through base pay and variable pay) and indirectly (through benefits)

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3
Q

Fair Labor Standards Act (FSLA) is what?

A
  • affects pay systems
  • requires most organizations to pay a minimum wage and to comply with overtime provisions, including appropriately classifying employees as exempt or nonexempt and as independent contractors or employees
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4
Q

a base pay system is developed how?

A

using information from valuations of jobs and pay surveys

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5
Q

valuation of jobs can be determined using either what two things?

A

job evaluation or market pricing

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6
Q

total rewards?

A

monetary and nonmonetary rewards provided by companies to attract, motivate, and retain employees

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7
Q

total rewards philosophy empahsizes what?

A

how a company can use both direct and indirect (or relational) rewards for motivation and commitment.

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8
Q

several strategic decision can guide the design of compensation practices what are they?

A
  1. compliance with all applicable laws
  2. cost-effectiveness for the organization
  3. internal and external equity for employees
  4. optimal mix of compensation components
  5. performance enhancement for the organization
  6. performance recognition and talent management for employees
  7. enhanced recruitment, involvement, and retention of employees
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9
Q

tangible rewards?

A

elements of compensation that can be quantatively measured and compared between different organizations

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10
Q

intangible rewards

A

elements of compensation that cannot be easily measured or quanitified

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11
Q

examples of tangible direct rewards?

A

base pay (wages, salary) and variable pay (bounses, incentives, and equity awards)

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12
Q

examples of tangible indirect rewards

A
  1. health care benefits
  2. paid time off
  3. disability benefits
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13
Q

intangible rewards

A
  1. suppoertive work environment
  2. challenging work
  3. autonomy
  4. positive reinforcement
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14
Q

base pay?

A

basic compensation that an employee receives often as hourly wage or salary

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15
Q

direct compensation examples?

A

base and variable pay

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16
Q

wages?

A

payments calculated directly on the basis of time worked by employees

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17
Q

salary?

A

consistent payments made each period regardless of the number of hours worked

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18
Q

variable pay?

A

compensation linked directly to individual, team, or organization performance
ex. bonuses, incentive programs, equity awards, and comissions

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19
Q

benefits?

A

indirect reward given to an employee or group of employees as part of membership in the organization, regardless of performance

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20
Q

primary federal law affecting compensation is what and what was it passed?

A

Fair Labor Standards Act (FLSA) and passed in 1938

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21
Q

provisions of both the original FLSA act and subsequent revisions focus on what 3 major areas?

A
  1. minimum wage
  2. limitations on the use of child labor
  3. exempt and nonexempt status (overtime provisions)
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22
Q

under the FLSA, employees are classified as exempt or nonexempt. what do those two things mean?

A

exempt employees hold positions where they do not get paid overtime.`
nonexempt employees must be paid overtime.
- overtime is required for those working hourly jobs but if you have a salary you are nonexempt

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23
Q

what is a fluctuating workweek?

A

when you only pay one third of the overtime rate because it is assumed that the base part of overtime pay has already been included in the salary that the individual has earned for that week.

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24
Q

for individuals who are nonexempt, employers must consider many issues. what are the 7?

A
  1. compensatory time off
  2. incentives for nonexempt employees
  3. training time
  4. security inspection time
  5. after-hours email time
  6. travel time
  7. donning and doffing time
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25
what is compensatory time off?
only in the public sector, comp hours are earned by public sector nonexempt employees in lieu of payment for extra time and worked at the rate of 15 times the number of hours over 40 worked that week
26
incentives for nonexempt employees
employers must add the amount of direct work-related incentives to an employee's base pay and then calculate overtime pay as 1.5 times the higher (adjusted) rate of pay
27
training time
time in training must count as work by nonexempt employees unless they voluntarily do it or it has nothing to do with their job
28
security inspection time
some companies may have to count the time that employees spend going through security inspections after work as compensable
29
after hours email time?
some employees can make arguement checking emails after hous counts as overtime. so companies can try to adopt curfew policies so they dont have check after hours
30
travel time?
travel time counts as work time if it occurs during normal work hours for the benefit of the employer
31
donning and doffing time
putting on clothes or taking care of equipment counts as work
32
title VII of the civil rights act of 1964 prohibits what?
discrimination based on race, color, sex, religion, or national origin
33
equal pay act of 1963?
act prohibits companies from using different wage scales for men and women performing essentially the same jobs
34
lilly ledbetter fair pay act
signed in 2009 allowed people to file complaints and discrimination in quicker manners bc a law prior severely restricted the time period for filing complaints of employment discrimination concerning compensation.
35
prevailing wage
an hourly wage determined by a formula that considers the rate paid for a job by a majority of the employers in the appropriate georgraphic area
36
garnishment
a court order that directs an employer to set aside a portion of an employee's wages to pay a debt to a creditor
37
what are the two basic compensation philosophies?
entitlement philosophy and the performance philosophy
38
entitlement philosophy?
assumes that individuals who have worked for another year with the company are entitled to pay increases with little regard for performance differences ex. giving automatic increases to their employees every year which are often called COST OF LIVING INCREASES
39
pay for performance philosophy?
assumes that compensation decisions reflect performance differences
40
what are " say on pay" guidelines?
guidelines that provide shareholders an opportunity to review top management pay at least once a year over a three year period
41
expectancy theory?
theory that says an employee's motivation is based on the probability that his or her efforts will lead to an expected level of performance that is linked to a valued reward
42
equity theory?
theory that says individuals judge fairness (equity) in compensation by comparing their inputs and outcomes against the inputs and outcomes of referent others
43
what are referent others?
workers that the individual uses as a reference point to make these comparisons
44
what are an example of inputs?
skills, abilities, knowledge, efforts
45
what are examples of outputs?
wages, salary, benefits, bonuses
46
what is internal equity?
means that employees are compensated fairly within an organization with regards to their KSA's they use in their jobs as well as their resposnibiltiies, accomplishments, and job performance
47
what is external equity?
when one companies's rewards are compared to anothers. if it isnt good they will have higher turnover rate bc people will leave
48
what are two types of justice that are important in regards to internal equity and what are they?
1. procedural justice - perceived fairness of the process and procedures used to make decisions about employees, including their pay 2. distributive justice - perceived fairness of how rewards and other outcomes are distributed
49
what is a quartile strategy and how is it used?
a quartile strategy is used to establish policies about where they (an organization) wish to be positioned in the labor market def: quartile strategy reflects the overall market position where the organization sets its compensation levels
50
an employer using a first quartile "lag the market" strategy choose to do what?
"lag the market" by paying below market levels for several reason such as not being able to pay more or there is a lot of workers and they can get some at lower costs to them however it can be bad bc of higher turnover and low employee moral
51
what is a lead the market strategy (3rd quartile)
this strategy helps companies attract and retain sufficient workers with require capabilities and be more selective when hiring
52
what is a match the market strategy of 2nd quartile?
when they pay employees what the market will pay them to balance employer cost pressure and need to get and keep employees
53
what are some considerations in determining what quartile strategy to use. 3 of them?
1. financial resources available 2. competitiveness pressures 3. market availability of employees
54
competency based pay
rewards individuals for the capabilities they demonstrate and acquire
55
offshoring?
moving jobs to lower wage countries
56
home country - based approach
maintains the standard of living the expatriate had in the home county. housing, taxes and discretionary spending expenses are calculated based on those items in the home country
57
host country - based approach
compensates the expatriate at the same level as workers from the host country
58
two general approaches for valuing jobs are?
job evaluation and market pricing
59
job evaluation
formal systematic process to determine the relative worth of jobs within an organization
60
ranking method?
simple system that places jobs in order from highest to lowest by value in an organization
61
classification method?
often used in public sector, descriptions of jobs are written and then each job is put into a grade according to the class it best matches
62
factor comparison method?
complex quantitative method that combines ranking and point factor methods. orgs that use this develop their own key jos and factors
63
point factor method?
most popular job evaluation approach bc its easy to use and considers components of a job
64
compensable factor
job dimension commonly present throughout a group of jobs within an organization that can be rated for each job
65
market pricing
uses market pay data to identify the relative value of jobs based on what other employers pay for similar jobs
66
primary advantage of market pricing is what?
it closely ties organizational pay levels to what is actually occuring in the market withinout influene of internal job evals
67
biggest disadvantage of market pricing is what?
that pay survey data may be limited or may not be gathered in methodologically sound ways
68
pay survey?
pay survey is a collection of data on compensation rates for workers performing similar jobs in other organizations
69
benchmark jobs
jobs that are found in many other organizations that can be used for the purposes of comparison
70
pay grades?
groupings of individual jobs that have approximately the same value to the organization
71
market line?
grah line that show the relationship between job value as determined by job evaluation points and job value as determined pay survey rates
72
market branding
grouping jobs into pay grades based on similar market survey amounts
73
broadbanding?
practice of using fewer pay grades with much broader ranges than in traditional compensation systems
74
red circled employee
incumbent who is paid above the range set for a job | ex. get paid 2o bucks ina a pay range of 15-20 so they red circled and cant get a raise
75
green circled employees
incumbent who is paid below the range set for a job. opposite of red circled and are encouraged to get rapid pay increase
76
pay compression
occurs when the pay differences among individuals with different levels of experience and performance become small
77
salary inversion
ocurs when the pay given to new hires is higher than the compensation provided to more senior employees
78
compa ratio
pay level divided by the midpoint of the pay range
79
seniority
time spent in an organization or working in a particular job
80
cost of living adjustment
pay increase to compensate for inflation and rising prices and are tied to the changes in the consumer price indenc or some other economic measure
81
accross the board increases
pay increasses across the board the same for everyone
82
lump sum incfreases
one time payment of all or part of a yearly pay increase. versus getting an increase in hourly wage

HR management (16 decks)

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