Chapter 9

Question 1

Compensation

Answer 1

is defined as all the monetary rewards provided to employees

Question 2

Direct Monetary Rewards

Answer 2

wages and salaries, overtime pay, paid vacations and holidays, retirement pay and sick leaves.

Question 3

Indirect Monetary Rewards

Answer 3

health insurance and life insurence, dental, vision, and cancer insurance.

Question 4

Labor Union

Answer 4

Is a factor that impacts compensation system.
Union representatives push hard for rewards systems that emphasize equality wherein all salary and wage increases are distributed equally among all workers.
-Use of step-increase program.
Reject performance-based reward systems wherein salary and wage increases are determined on the quality and quantity.

Question 5

Market Forces

Answer 5

law of supply and demand has a great deal to do with the compensation levels paid.
supply of workers increase then wages decrease.
the supply of professional workers is greater than the demand because:
-intrinsic and extrinsic
-lack of formal control (no testing competence)
-may not appreciate hiring professional workers in park.

Question 6

Compensation program

Answer 6

developing job descriptions, evaluating and ranking the relative worth of various jobs within an organization, assigning jobs to classification according to written standard, and defining a pay structure for each level of compensation.

Question 7

informal, arbitrary system

Answer 7

although flexible, easy to establish, and easy to administer, an informal, arbitrary pay program usually leads to favoritism, discrimination, and unfair politicking, and game playing

Question 8

formal base-pay systems

Answer 8

job descriptions
job evaluation
job clasiffication
pay structure

Question 9

Augmenting salary and wages: performance-based increases

Answer 9

most organizations have a system in place for awarding merit increases based on the quantity and quality of work performed.

Question 10

Augmenting salary and wages: non-performance based increases

Answer 10

organization may adjust salaries upward based on increases in the cost-of-living for rent, fuel, clothing, food, and other living expenses
-COLA, cost-of-living adjustment
-across the board increase.
pay compression: when there is only a small pay difference among employees regardless of the qualifications and experience.
-Longevity:length of service to an organization

Question 11

employee benefits programs

Answer 11

based on tenure of years worked and whether you are permanent or full time.
-entitled to benefits
part time and seasonal don’t get benefits.

Question 12

employer-sponsored benefits

Answer 12

1. healthcare insurance they get premium at a group rate, they still have to share the cost with their organization
2. Life insurance compensates a surviving spouse or another designated beneficiary in the case of the death of an employer.
3. Disability insurance
4. Supplemental Insurance
5. Pension plan
6. Paid Time off
   - Annual Leave
   - Holiday Leave
   - Sick Leave
   - Death of a love one: Bereavement leave.
7. mileage reimbursement for use of personal vehicle
   - assigning a company vehicle
8. Memberships to professional associations and societies.
9. Continuing education, training and development
10. free and discounted fees for participating programs and services
11. uniforms and clothing
12. EAP: employee assistance prgram: counseling,
13. Senior management: 100% paid.

Question 13

legislation impacting compensation

Answer 13

1. Social security and medicare
2. unemployment insurance (FUTA)
3. Workers compensation
4. Fair labor and standars act (FLSA) prevents low wages from workers attaining the minimum standards of living.
5. COBRA: Consolidated omnibus budget reconciliation act: still get covered if anything happens