FINAL EXAM

Question 1

Appraisal Process

Answer 1

1. Establish performance standards with employees
2. Communicate expectations
3. Measure actual performance
4. Compare actual performance with standards
5. Discuss the appraisal process with the employee
6. If necessary, initiate corrective action

Question 2

MBO’s contain

Answer 2

1. Specific goals
2. Participative decision making
3. Specific time period
4. Performance feedback

Question 3

Leniency error

Answer 3

performance appraisal distortion caused by evaluating employees against one’s own value system

Question 4

Halo error

Answer 4

the tendency to let our assessment of an individual on one trait influence our evaluation of that person on other specific traits

Question 5

Similarity error

Answer 5

evaluating employees based on the way an evaluator perceives himself or herself

Question 6

Central tendency

Answer 6

the tendency of a rater to give average ratings

Question 7

Attribution theory

Answer 7

a theory of performance evaluation based on the perception of who is in control of an employee’s performance

Question 8

Management by objectives (MBO)

Answer 8

a performance appraisal method that includes mutual objective setting and evaluation based on the attainment of the specific objectives

Question 9

Absolute standards- Measuring an employee’s performance against established standards

Answer 9

Critical incident appraisal- a performance evaluation that focuses on key behaviors that differentiate between doing a job effectively or ineffectively
· Checklist appraisal- a performance evaluation in which a rater checks off applicable employee attributes
· Graphic rating scale- a performance appraisal method that lists traits and a range of performance for each
· Forced choice appraisal- a performance evaluation in which the rater must choose between two specific statements about an employee’s work behavior
· Behaviorally anchored rating scales (BARS)- a performance appraisal technique that generates critical incidents and develops behavioral dimensions of performance. The evaluator appraises behaviors rather than traits.

Question 10

Relative Standards Methods

Answer 10

· Relative standards- evaluating an employee’s performance by comparing the employee with another employee
· Individual ranking- Ranking employee’s performance from highest to lowest
· Paired comparison- Ranking individuals performance by counting the times any one individual is the preferred member when compared with all other employees

Question 11

Intrinsic rewards

Answer 11

satisfactions derived from the job itself, such as pride in ones work, a feeling of accomplishment, or being part of a team

Question 12

Extrinsic rewards

Answer 12

benefits provided by the employer, usually money, promotion, or benefits

Question 13

Job enrichment

Answer 13

enhancing jobs by giving employees more opportunity to plan and control their work

Question 14

Performance based rewards

Answer 14

rewards exemplified by the use of commissions, piecework pay plans, incentive systems, group bonuses, or other forms of merit pay

Question 15

Compensation administration

Answer 15

the process of managing a company’s compensation program

Question 16

Fair Labor Standards Act (FLSA)-

Answer 16

Passed in 1938 this act established laws outlining minimum wage, overtime pay, and maximum hour requirements for U.S. workers

Question 17

Exempt employees

Answer 17

employees in positions that are exempt from most employee protection outlined in FLSA, especially overtime pay

Question 18

Nonexempt employees

Answer 18

Employees who are covered by the FLSA, including overtime pay and minimum wage provisions of the act

Question 19

Equal Pay act of 1963

Answer 19

• This act requires equal pay for work

Question 20

Ordering method

Answer 20

ranking job worth from highest to lowest

Question 21

Classification method

Answer 21

evaluating jobs based on predetermined job grades

Question 22

Point method

Answer 22

breaking down jobs based on identifiable criteria and the degree to which these criteria exist on the

Question 23

Compensation surveys

Answer 23

used to gather factual data on pay practices among firms and companies with specific communities

Question 24

Wage structure

Answer 24

a pay scale showing ranges of pay within each grade

Question 25

External factors of pay

Answer 25

Geographical location
·         Labor supply
·         Competition
·         Cost of living
·         Collective bargaining
·         Communicating with employees

Question 26

Incentive compensation plans

Answer 26

motivate systems based on individual work performance

Question 27

Merit pay

Answer 27

an increase in pay, usually determined annually

Question 28

Group incentive

Answer 28

motivational plan provided to a group of employees based on their collective work

Question 29

Organization wide incentive

Answer 29

a motivation system that rewards all facility members based on how well the entire group performed

Question 30

Scanlon plan

Answer 30

an organization wide incentive program focusing on cooperation between management and employees through sharing problems, goals, and ideas

Question 31

IMPROSHARE

Answer 31

an incentive plan that uses a specific mathematical formula for determining employee bonuses

Question 32

Pay for performance

Answer 32

rewarding employees based on performance

Question 33

Broad banding

Answer 33

paying employees at preset levels based on their level of competency

Question 34

Team based compensation-

Answer 34

pay based on how well the team performed

· Executive compensation Programs

Question 35

Perquisites

Answer 35

attractive benefits, over and above a regular salary, granted to executives, also known as perks

Question 36

Golden parachute

Answer 36

financial protection plan for executives in case they are severed from the organization

Question 37

Employee benefits

Answer 37

Membership based, nonfinancial rewards offered to attract and keep employees

Question 38

Domestic partner benefits

Answer 38

benefits offered to an employee’s live-in partner

· Legally required benefits