Deck 11

Question 1

FLSA wage calculations and incentive payments

Answer 1

bonuses included in overtime calculations and bonuses excluded from overtime calculations

Question 2

bonuses included in overtime calculations

Answer 2

those promised to newly hired employees, provided for in union contracts or other agreements, announced to induce more work, or remain with the firm

Question 3

Bonuses excluded from the overtime calculations

Answer 3

christmas, gifts, ones so substantial that employees don’t consider them apart of wages, purely discretionary one in which the employer retains discretion over how much to pay

Question 4

pay of performance plans

Answer 4

-individual employee
-incentive and recognition programs
-sales compensation programs
-team based variable pay programs
-organization wide incentive programs
-executive incentive compensation programs

Question 5

piecework plans

Answer 5

the worker is paid a sum for each unit they produce

Question 6

Merit pay

Answer 6

is a permanent cumulative salary increase the firms awards to an individual employee based on their individual performance

Question 7

merit pay options

Answer 7

give annual lump-sum merit raises that do not make the raise part of an employee’s base salary : tie is to both individual and organizational performance

Question 8

professional employees

Answer 8

are those whose work involves the application of learned knowledge to the solution of the employer’s problems (lawyers, doctors, economists, engineers)

Question 9

Possible incentives

Answer 9

bonuses, stock options, and grants profit sharing, better vacations, more flexible work hours, improved pensions plans, equipment for home offices

Question 10

Effect of Recognition based awards

Answer 10

recognition has a positive impact on performance, either alone or in conjunction with financial rewards

Question 11

ways to use recognition

Answer 11

social recognition, performance based recognition, performance feedback

Question 12

information technology and incentives

Answer 12

software that automates planning, calculation, modeling and management of incentive compensation plans

Question 13

online award programs

Answer 13

programs offered by online incentives firms that improve and expedite the awards process

Question 14

salary plan/straight salaries

Answer 14

best for: prospecting, account servicing, training customer’s sales force, or participating in national and local trade shows

Question 15

commission plan

Answer 15

-pay is percentage of sales results
-keeps sales costs proportionate to sales revenues
-may cause a neglect of nonselling duties
-can create wide variation in salesperson’s income
-likelihood of sales success may be linked to external factors rather than to salesperson’s performance

Question 16

Combination Plan

Answer 16

-pay is a combination of salary and commissions usually with a sizable salary component
-gives salespeople a floor to their earnings
-salary component covers company specified service activities

Question 17

Commission plus drawing account plan

Answer 17

-commissions are paid but a draw on future earnings helps the salesperson to get through low sales periods

Question 18

commission plus bonus plan

Answer 18

-pay is mostly based on commissions
-small bonuses are paid for directly
-activities like selling addons or slow moving items

Question 19

Executive total reward package

Answer 19

-base salary
-short term incentives
-long term incentives

Question 20

Sarbanes Oxley act of 2002

Answer 20

makes executives and the board of directors personally liable for violating their fiduciary responsibilities to their shareholders

Question 21

Short term incentives

Answer 21

-plans intended to motivate short term performance or managers and tied to company profitability

Question 22

Creating an executive compensation plan

Answer 22

1. define the strategic context for the executive compensation program
2. shape each component of the package to focus the managers on achieving the firm’s strategic goals
   3.check the executive compensation plan for compliance with all legal regulatory requirements and for tax effectiveness
3. install a process for reviewing and evaluating when a major business change occurs