Chapter 8 Flashcards
What are 2 types of reward?
Financial
- Direct (hourly wage, salary, piece work, rate, bonuses-> dental insurance, health insurance, life insurance etc…)
- Indirect (benefits)
Non-financial
- Employee recognition programs (employee of the month…
- Flexible work hours
- Any other program that provides value to the employee in exchange for their efforts
What are some common organizational reward goals?
- Reward for past performance
- Remain competitive on the market ( if other companies do this, we want to do this too.. want people to say: this is a good place to work)
- Maintain salary equity among employees (you want your reward structure to motivate employees)
- Control compensation budget
- Attract, motivate and retain key employee
- Influence employee behaviours and job attitudes
What is a significant goal driving pay and reward changes?
- improve employee’s focus on achieving business goals
What are some internal factors determining wages?
- Employers’ compensation strategy ( looking at competition…)
- Employee’s relative worth
- Perceived worth of a job
- Employer’s ability to pay
What are some external factors determining wages?
- General economy
- Labour market conditions ( if a lot of supply, job is not going to be higher possible wage. But if someone having critical skills, going to influence wage)
- Area wage rates
- Cost of living (fix basket of goods and compare..)
- Collective bargaining
- Legal requirement (minimum wage)
What are the 4 job evaluation systems?
- Job ranking systems
- Job classification system
- Point system
- Factor comparison system
What are the 4 compensation structures?
- Wage and salary surveys (survey in the labour market)
- Wage curve
- Pay grades
- Rate ranges
What is the competency based pay?
Pay based on how many capabilities employees have or how many jobs they can perform
- How much they can multitask or multiskill.
- Based on employee’s competencies. How many job they can do => pay
- Promotes culture of learning, developing competencies,
What is broadbanding?
- Organization that use skill-based pay often use broadbanding
- Few wide salary bands
- Collapses many traditional salary grades into a few large salary bands
- Encourages lateral skill building
What are some incentive plans?
- Individual bonus (supplements the basic pay, for exerting greater efforts…)
- Team or group-based incentives ( reward team members when agreed upon performance standards are exceeded)
- Merit raise ( when performance standards achieved )
- Profit-sharing (based on the profits of the organization)
- Employee stock ownership plans
What are employee benefits?
Indirect rewards on behalf of employees to improve the quality of their work and personal lives
Can be voluntary or mandatory
- Companies spend 35 to 45% of payroll on retirement plans, group health benefits and paid time off.
What are some benefits required by law? (mandatory)
CPP/QPP (Canada and Qc pension plan => retiring pension…)
Employment insurance (EI)
Workers’ compensation insurance
Provincial hospital and medical services
Leaves without pay
What are some voluntary benefits?
- Health and welfare insurance
- Retirement and pension plans
- Pay for time not worked
- Leaves of absence
- Wellness programs
- Employee assistance programs
- Educational assistance
- Child and eldercare
