Topic 9

Question 1

employee and organizational performance

Answer 1

Variable compensation links an employees pay to what?

Question 2

What are three examples of variable pay?

Answer 2

profit sharing, bonuses, stock option

Question 3

Fixed pay

Answer 3

nondiscretionary compensation that is independent of performance

Question 4

hourly wage & salary

Answer 4

What are the two most common forms of fixed pay?

Question 5

incentive pay plans

Answer 5

a specific type of performance-based pay system which is used to encourage specific actions and motivate employees

Question 6

piecework

Answer 6

employees are guaranteed a standard pay rate for each unit of output, also called a piece rate

Question 7

sales incentive (commission)

Answer 7

apply to salespeople and managers, who generally receive their pay in the form of commissions

Question 8

stock options

Answer 8

an opportunity for a manager to buy an organization’s stock at a later date, but at a price established when the option is granted

Question 9

cash plans

Answer 9

provide for payment of profit shares at regular intervals, typically monthly or yearly

Question 10

Gainsharing (or bonus based on achievement)

Answer 10

leads to enhanced productivity and subsequently creates additional profits in which all parties share.

Question 11

wage-dividend plan

Answer 11

a special type of cash plan, set the percentage of profits paid to employees according to the amount of dividends paid to stockholders

Question 12

Variable compensation

Answer 12

_______________ is based upon the company’s performance or employee performance.

Question 13

Cash plan

Answer 13

_______________ are paid out based on a broad financial measure of the organization’s profitability.

Question 14

Indirect compensation

Answer 14

Medical insurance, negotiated discounted gym memberships, and employee training are all examples of ______________.

Question 15

Gain share

Answer 15

_______________is a payout based on operational measures (productivity, quality, spending, service)

Question 16

Merit pay

Answer 16

________________ is an example of variable compensation.

Question 17

Benefits

Answer 17

____________ is an indirect compensation method used to keep cost down while helping the organization achieve is goals.

Question 18

Fixed pay

Answer 18

____________ is pay that has been determined in advance and is set at a particular amount regardless of performance. (9.6)

Question 19

Wage-dividend plan

Answer 19

___________is an incentive that sets the percentage of profits paid to employees according to returns paid to stockholders.

Question 20

Job evaluation

Answer 20

__________ is the process of comparing jobs by the use of formal and systemic procedures to determine their relative worth within the organization.

Question 21

Piecework plan

Answer 21

______________ guarantees a standard pay rate for each unit of output.