HRM Final Flashcards
1
Q
Total Compensation (Financial Returns)
A
- Direct: cash (e.g., base salary, merit pay, incentives, stock options)
- Indirect: Benefits and Services (e.g., insurance, retirement, paid time off)
2
Q
Non-financial returns from work
A
- Flexible work arrangements
- Great co-workers / bosses
- Great location
- Learning opportunities – careers
- Challenging & Meaningful Work
3
Q
pay fairness
A
- Based on different forms of pay—total rewards
- Both internal and external comparisons used
- Compare ratios of outcomes / inputs
- Negative consequences of perceived inequity
4
Q
External Competitiveness Strategy
A
Firms make strategic decisions about whether to lead, lag, or meet the market rate for different jobs
5
Q
In general, what are some potential advantages for leading the market?
A
- More applicants [select better quality employees]
- Improve motivation (increase effort / productivity)
- Less turnover
- Decrease monitoring and supervision
6
Q
Costco vs Walmart example
A
- Lower turnover: 17%(Costco) vs. 44%(Sam’s)
- Higher productivity: Operating profit per employee $21,805 (Costco) vs $11,615 (Sam’s)
- Less “shrinkage” (combination of employee theft, shoplifting, vendor fraud, administrative error). Costco’s inventory shrinkage is lowest in industry (less than .20 percent of sales).
- Higher sales per square foot: $886 (Costco) vs $525 (Sam’s)
- Lower Selling, general, and admin expenses [SGA] 9.73% at Costco among lowest in industry
7
Q
Internal Equity- Job Evaluation
A
- Measures relative internal worth of organization’s jobs
- Committee identifies each job’s compensable factors
- Characteristics organization values and is willing to pay for
Jobs rated for each factor
8
Q
Internal Equity- Compensable Factors
A
Experience
Education
Complexity
Working conditions
Responsibility
9
Q
compensable factors
A
- Position does not entail overseeing the work of other employees or facilitation/leading any team discussions
- Position requires leading team meetings or facilitating team discussions. Also may involve supervising the work of other employees when necessary
- Position requires overseeing and directing the work of at least 1 employee. Train and mentor employees when necessary
- Position is responsible for leading, directing and/or supervising employees within one team or department. Expected to train, mentor and ensure accountability of all members of the team
- Position is responsible for leading, directing and/or supervising employees across several departments. Looked upon to provide guidance to departments and senior management on complex issues
10
Q
Pay Ranges
A
- Set of possible pay rates defined by a minimum, maximum, and midpoint of pay for employees holding a particular job or a job within a particular pay grade
- Flexibility helps organization balance conflicting information from job evaluations and market surveys
- Usually pay ranges overlap somewhat
11
Q
equity theory
A
People compare inputs and outcomes for themselves and others—performance is important “input”
12
Q
Expectancy theory
A
- Behavior a function of Expectancy X Instrumentality X Valance
- Expectancy: employees’ assessment of their ability to perform required job tasks. [If I try hard, can I perform job well?]
- Instrumentality: employees’ beliefs that the requisite job performance will be rewarded by the organization [If I perform well, will I be rewarded?]
- Valence: value employees attach to the organizational rewards [Is the reward worth it?]
13
Q
Common problems with Incentive pay plans
A
-Not enough motivation: Not enough reward or reward not valued, Process / outcome seen as unfair, Employees can’t influence outcomes
- Motivate the wrong behaviors, Goal displacement, Measurement issues
14
Q
Piecework
A
Wage based on amount (e.g.,number of units) employee produces
15
Q
Individual bonuses
A
- Not rolled into base pay
- Employee must re-earn bonus during each period
- May be based on objective outcomes (e.g., meeting sales target)
16
Q
merit pay
A
- Pay increases linked to ratings on performance appraisals (subjective): Some pros and cons based on quality of perf appraisals
- Added to base salary
17
Q
Gainsharing
A
- Measures improvements in productivity and effectiveness and distributes portion of each gain to employees
- Addresses challenge of identifying appropriate performance measures for complex jobs
- Employees determine how to improve own and group’s performance
18
Q
profit sharing
A
- Payments are a percentage of organization’s profits and are not part of employees’ base salary
- May encourage employees to think like owners
- Evidence not clear whether profit sharing is effective in improving performance
19
Q
what is aaa balanced score card
A
- Combination of performance measures
- Directed toward company’s long- and short-term goals
- Used as the basis for awarding incentive pay
20
Q
what are the 4 categories of a balanced score card
A
Financial
Customer
Internal
Learning and Growth
21
Q
workers comp: Form of no-fault insurance
A
- Employer liable for providing benefits to employees that result from occupational illnesses or injuries, regardless of fault
- Injury/illness must be work related
22
Q
workers comp: Covered by state, not federal, laws
A
- Employers pay premium to insurance company or state fund
- Cost varies by occupation, experience-rated
23
Q
social security
A
- Provides a basic foundation of security for American workers and their families
- For tax purposes, system is split into two programs
24
Q
SOCIAL SECURITY Benefits
A
Retirement income
Disability benefits
Dependent benefits
Survivor’s benefits
Lump-sum death benefits
6.2% of eligible earnings up to cap (about $143K)
Employee and employer funded
25
unemployment insurance
- Benefits financed by federal and state taxes levied on employers
- Each company’s rate depends on its prior experience
- Eligibility requirements and payments
- Have been employed (6+ months)
- Available and looking for work
Did not quit or fired for cause
26
Fair Labor Standards Act (F.L.S.A.)
- Minimum Wage: Lowest amount employers pay under federal & state laws, Local “living wage” laws—based on cost of living
- Mandatory overtime pay (for “non-exempt” workers), Employers required to pay 1.5x usual rate for over 40hrs. week
- Child labor (under 18 yrs), some exceptions (e.g., after-school work, work for parents)
27
retirement plans
- Defined benefit plans: Vesting (Time until fully eligible to receive pension, regardless whether you remain at org)
- Defined contribution plans: Example: 401k plans
28
Trends in Union Membership
- Peaked in 1950s reaching over one-third of employees
- Now at 10.7% overall; 6.5% of private-sector employment
- Decline in union membership due to many factors:
- Change in structure of economy
- Management efforts to control costs
- Human resource practices
Government regulation
29
National Labor Relations Act (NLRA)
- Protects the following activities [Section 7 Rights]: Union organizing, Joining a union, whether recognized by employer or not, Going out on strike, Refraining from activity on behalf of the union
- Most employees in private sector covered by NLRA: Not public sector or transportation workers [separate laws for these workers], Not independent contractors, Not supervisors
30
Unions in Government
- Membership among government workers is strong: About 1 in 3 government workers are union members
- Government regulations and laws support the right of government workers to organize: Similar to private sector laws
- Labor relations different with government workers: Strikes illegal for federal and state workers in most states, Almost all states prohibit strikes by police/firefighters at local level
31
NLRA Section 7: Rights of Employees
“Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection…”
