HRM 463:Compensation Management

Barry A. Friedman, Ph.D. 247 Rich Hall Phone: (315) 312-6381

E-mail: friedman@oswego.edu Fax: (315) 312-5440
Office Hours: M,W,F 2-3:30 pm, and by appointment

Purpose The development and maintenance of internally equitable and externally

competitive wage and salary programs is studied. Major emphasis is given to
the importance of total compensation as a tool for effective business strategy
implementation, and in attracting, retaining, and motivating employees. Topics
include: compensation theory; compensation as a component of strategic
management; monetary and non-monetary compensation as a motivator; legal
aspects of compensation; job analysis; job evaluation; pay structure
determination, performance appraisal; incentive plans; employee benefits.

Prerequisite HRM 386 or permission of the instructor. Students without adequate academic
background should not remain in this course. Those who choose not to drop
the course will not be allowed to withdraw because of inadequate academic
preparation. Inadequate preparation often leads to poor performance.

Relevance Compensation systems are the primary means by which organizations induce
contributions from their human resources. When effectively managed, total
compensation is a competitive advantage in today’s increasingly rapidly
changing business environment. Effective compensation management is
essential for unleashing human resource potential.

Course To determine how to make effective compensation decisions under realistic

Objectives organizational conditions. More specifically, upon successful completion of this
course, students will be able to:
q Explain how compensation decisions fit organizational strategy
implementation
q Explain the impact of legal requirements on compensation management
q Identify and explain the rationale for the different types of incentive plans
q Distinguish between different types of pay and compensation plans and
structures
q Analyze, critique and recommend changes for compensation systems
q Identify effects of compensation systems on organizational performance

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Method:

Complete Discuss
Review and Analyze Cases
Readings/Cases
Discuss
Review
in Small Groups
Before Class Questions
Content

Texts Milkovich, G.T. and Newman, J.M. (2002) Compensation. Seventh Edition. (Text)
Milkovich, G.T., and Milkovich, C. (2004) Cases in Compensation. Ninth Edition.
(Casebook)
Expectations 20%- Participation
20%- Midterm
20%- Final
40%- Four Team Reports and Presentations (10% each)
Participation is determined by evaluating your:
1) ability to respond to questions;
2) contribution to discussions and exercises in class;
3) the quality of the questions you ask.
“A”s in participation are awarded to students who develop the reputation as a
person who is always prepared, willing and able to contribute whether it is to
answer or ask questions, or to participate in any of a variety of in-class
exercises. Participation grades below “C” in this class are rare, reserved for
students who demonstrate disrespect for class participants. If you experience
difficulty speaking in class, please see me.
Attendance is essential and obligatory. Attendance will be taken. Students may
be dropped for non-attendance. It is your responsibility to regularly attend
classes and complete assignments as scheduled.
This course requires that you read the assigned text chapters, cases and
consider the review questions before each class meeting. Class discussion is
expected as we examine compensation issues. Active and constructive
participation during small group activities will help you apply knowledge.
Exams address class, textbook, case, and reading material (the final is not
cumulative). The exams will be some combination of multiple choice and essay
questions.
The Team Reports asks that you design a compensation system for FastCat, a
case study. Specific instructions are in the Cases in Compensation casebook.
Short informal presentations are required. Reports are due the class meeting
after the presentation (except for last report, due same day).

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HRM 463
Add/Drop It is the responsibility of the students to be fully informed of the college
Process catalog policies regarding course add, drop and withdrawal.
Disability If you have a disabling condition that might interfere with your ability to
complete this course successfully, please contact me, or contact the Office of
Disability Services (phone 312-3358).

Please read text chapter, review questions and cases

prior to class
Text Chapter Review
Dates Topics Unless otherwise Questions
noted

9/3,5 Course Introduction 1,2

Strategic Compensation, Total Rewards, Pay Model
9/8 Teamwork-Text case study (Difficult to Copy: Not!, p. 53)

9/10 FastCat: Objectives for FastCat’s Compensation Casebook

System (p.1-10)

9/12 FastCat: Team Presentations of Strategy

9/15 Strategic Policy I: Defining Internal Alignment 3 3 (p.83-84)

Determining Pay Structure
(First Team Report Due)
9/17 Teamwork-Text case study (So You Want to Lead the
Orchestra?, p. 84-85)
9/19-22 Job Analysis 4 1-7
(p.115-116)
9/24 Teamwork-Text case study (3M’s Dual Ladders, p.116)

9/26,29 Job Evaluation 5 1-6

(p.146-147)
10/1 Teamwork-Text case study (Job Evaluation for the State,
p.147-151)
10/3-6 Person Based Structures: Skills and Competencies 6 1-6
(p.187-188)
10/8-10 FastCat: Phase I- Alignment: Designing an Internal Casebook
Structure (p.11-36)

10/13 FastCat: Team Presentations of Internal Structure

10/15 Strategic Policy II: Defining External Competitiveness 7

and Determining the Pay Level
(Second Team Report Due)

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HRM 463
 Please read text chapter, review questions and cases
prior to class

Text Chap. Review

Dates Topics Unless otherwise Questions
noted

10/17-20 Designing Pay Levels, Mix and Pay Structures 8 1-5

(p.272-273)
10/22-24 FastCat: Phase II External Competitiveness- Pricing Casebook
the Structure (p.37-58)

10/27 FastCat: Team Presentations

Midterm Essay Take Home (Part One)
10/29 Midterm (Part Two in class)
(Third Team Reports Due)
11/31 Strategic Policy III: 9,10
Employee Contributors: Pay for Performance
11/3 Performance Appraisals 11 3-4 (p.384)

11/10 Teamwork-Text case study (Policy Implications Merit Pay

Guides, p.385)

11/12-14 Determining Employee Benefits 12,13 1-5

Benefit Options (p.481-482)
11/17 Special Compensation Issues 14
Special Groups- supervisors, corporate directors,
executives, sales, and contingent workers
11/19-21 Union Role in Compensation 15 1-4 (p.528)
11/24 International Compensation 16
12/1-3 Teamwork-Text case study (International
Compensation, p.575)
12/5 Strategic Policy IV: 17 1-7 (p.617)
Pay Administration-Government and Legal Issues
12/8 Managing Compensation Budgets and Administration 18

12/10 FastCat Phase III: Performance and Execution Casebook

(p.59-71)
12/12 FastCat Team Presentations
(Fourth Team Report Due)
12/15-19 Finals

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HRM 463