Chapter 12: Money and Motivation Flashcards
Fixed pay
compensation that is independent of the performance level of the individual, group, or organization
variable pay
any plan that ties pay to productivity or profitability
intrinsic motivation
motivation that derives from the pleasure someone gets from doing the job or task
instrumentality
the perceived relationship between successful performance and obtaining the reward
expectancy
a person’s expectation that his or her effort will lead to performance
valence
the perceived value a person attaches to the reward
merit pay (merit raise)
any salary increase awarded to an employee based on his or her individual performance
employee share purchase/stock ownership plan (ESOP)
a plan whereby a trust is established to hold shares of company stock purchased for or issued to employees . The trust distributes the stock to employees on retirement, separation from service, or as otherwise prescribed by the plan.
profit-sharing plan
a plan whereby most or all employees share in the company’s profits
gainsharing
an incentive plan that engages employees in a common effort to achieve productivity objectives and share the gains
piecework
a system of pay based on the number of items processed by each individual work in a unit of time, such as items per hour or items per day
guarenteed piecework plan
the minimum hourly wage plus as incentive for each unit produced above a set number of units per hour
straight piecework plan
a set payment for each piece produced or processed
differential piece-rate plan
a plan by which a worker is paid a basic hourly rate plus an extra percentage of his or her base rate for production exceeding the standard per hour or per day. It is similar to piecework payment but is based on a percentage premium
team or group incentive plan
a plan in which a production standard is set for a specific work group and its members are paid incentives if the group exceeds the production standard
