Workshop 7 Flashcards
What can be included in a compensation package?
- pay
- health-care benefits
- 401 (k) plans
- etc
Goals of a compensation package
- to attract the best people for the job
- to motivate people to stay
- to improve morale, motivation and satisfaction amongst employees
What is the function of job evaluation systems
It can help determine if pay is equitable and fair among employees
Name several ways of job evaluation:
- Job ranking system
- Job classification system
- The point-factor system
- The hay profile method
What is the job ranking system?
Job titles are listed and ranked in order of importance to the organization.
What is the job classification system?
Every job is classified and grouped based on the knowledge and skills required for the job, years of experience, and amount of authority for that job.
What is the point-factor system?
It determines the value of a job by calculating the total points assigned to it.
What is the Hay profile method?
This proprietary job evaluation method focuses on three factors called know-how, problem solving, and accountability.
What is the equity theory?
It is a pay theory. The equity theory is concerned with the relational satisfaction employees get from pay and inputs they provide to the organization. People will look at their own compensation packages and at their own inputs (the work performed) and compare that with others.
What is external pay equity?
What other people in similar organizations are being paid for a similar job.
What is internal pay equity?
It focuses on employees within the same organization. Within the same organization, employees may look at higher level jobs, lower level jobs, and years with the organization to make their decision on pay equity.
What is the expectancy theory?
It is another pay theory. If the employee perceives they are going to be paid favorably, they will work to achieve the outcomes. If they believe the rewards do not equal the amount of effort, they may not work as hard.
What is the reinforcement theory?
If high performance is followed by some reward, that desired behavior will likely occur in the future. Likewise, if high performance isn’t followed by a reward, it is less likely the high performance will occur in the future.
What is the bonus structure?
It is designed to reward performance, rather than be a guaranteed part of the compensation plan.
What is pay?
the hourly, weekly or monthly salary an employee earns
