Professional Documents
Culture Documents
Establishing r ewar ds
and pay plans
❚ Intrinsic - Extrinsic
❚ Financial-
Nonfinancial
❚ Membership-
Performance
❚ Personal
satisfaction from
the job itself
❚ Consistent with own
value system
❚ Decision making
❚ Freedom
❚ Control
❚ AND/OR….
❚ Responsibility
❚ Interesting work
❚ Personal growth
❚ Diversity of
activities
❚ Wages
❚ Bonuses
❚ Profit-sharing
❚ Vacations
❚ Sick leave
❚ Purchase discounts
❚ Extras at the
disposal of the
company
❚ Do not affect the
financial position of
the employee
❚ Creative
❚ Varied
❚ Office furnishings
❚ Lunch hours
❚ Parking spaces
❚ Work assignments,
locations
❚ Business cards
❚ Secretary
❚ Titles
❚ Most organizational
rewards
❚ Regardless of
performance
❚ Examples
❙ Cost-of-living increases
❙ Benefits
❙ Salary due to labor
market conditions
❚ Job evaluation
based
❚ Cost-effective pay
structure
❙ Attract, motivate,
retain
❚ Fair
❚ Legal
❚ FAIR LABOR
STANDARDS ACT
❚ Exempt -
professional and
managerial
❚ Overtime pay
❚ Minimum wage
❚ Prevailing wage
❚ Child labor
restrictions
❚ Record keeping
❚ Prevents
discrimination
❚ Equal pay for equal
work
❚ Women still earn
only 75% of what
male counterparts
earn
❚ Use 3 to 5
❚ May be subdivided
❚ Examples
❙ Skill
❙ Education
❙ Working conditions
❙ Effort
❙ Responsibility
❚ Ordering
❚ Classification
❚ Point
❚ Government
❚ General Schedules
❚ Compensable factors
❙ Skill
❙ Knowledge
❙ Responsibility
❚ Complicated to
develop
❚ Easy to use, stable
❚ Compensable factors
❚ Divided into degrees
❚ Flexibility
❚ Good to address
comparable worth
❚ Compensation surveys
❙ Industry
❙ Location
? ❚ Items
❙ Wage levels
❙ Shift differentials
❙ Vacation days
❙ Holiday allowances
❙ Minimum wage levels
❚ Wage curves
❚ Relationship between
job value and wages
❚ Plot on a graph
❚ Identify outliers
❚ Red circled - high
❚ Green circled - low
❚ Individual incentives
❙ Merit pay
❙ Piecework plans
❙ Commissions
❙ Time saving bonuses
❚ Group incentives
❚ AND….
❚ Plant-wide
incentives
❙ Scanlon Plan
❙ IMPROSHARE
❙ Cost reduction
❙ Profit sharing
❙ Gain-sharing
❙ Dilution effect
problem
❚ Piecework
❚ Gainsharing
❚ Wage incentive
plans
❚ Lump sum bonuses
❚ Performance>>>>
rewards
❚ Motivation
❚ Popular
❚ Not added to base
❚ Control of
individual or group
❚ EXAMPLES
❚ Competency-based
❚ Broad-banding
❚ Team-based
compensation
❚ Salaries
❚ Supplements
❙ Deferred
compensation
❙ Hiring bonus
❙ Stock options
❚ Golden parachutes
❚ AND….
❚ Perquisites
❙ Cars
❙ Country clubs
❙ Consulting fees
❙ Retirement
supplements
❙ Expense accounts
❚ Base pay
❚ Differentials
❚ Incentives
❚ Assistance programs
❚ REMEMBER THESE
TERMS???
❙ Wage structure
❙ Compensation survey
❙ Perquisite
❙ Piece rate
❙ Red circled job
❙ Membership based
rewards
❙ Compensable factor