Compensation Flashcards
147 - 185 Group Commissions
A performance pay plan in which the commissions of a group of sales workers are pooled and then shared out equally among members of the group.
424 - 439 Fixed Benefit System
An employee benefit plan that provides a standard set of benefits to all those covered by the plan.
291 - 321 Pay Range
The minimum and maximum pay rates (in dollars) for jobs in a particular pay grade.
147 - 185 Group Piece Rates
A performance pay plan in which group members get paid based on the number of completed products produced by the group.
3 - 103 Craft Technology
Few exceptions occur in the production process, but there is no standardized way to deal with them when they do occur.
147 - 185 Differential Piece Rate
A lower sum of money per piece is paid if employee production does not meet the production standard, and then is paid once the production standard is met.
391 - 415 Phantom Equity Plan
A plan that helps retain key employees by providing rewards based on the stock performance of a portfolio of promising new high-tech firms.
3 - 103 High-involvement Strategy
Assumes that work can be instrinsically motivating if the organization is structured properly.
3 - 103 Low-cost Business Strategy
A business strategy that depends on providing low-cost products or services to a broad range of customers.
352 - 379 Graphic Rating Scale
An appraisal method in which appraisers use a numerical scale to rate employees on a series of characteristics.
352 - 379 Paired Comparison Method
Determines the rank order of all employees in a unit by comparing each employee with each of the other employees in the unit.
147 - 185 Leverage Selling
Selling new products to existing customers.
424 - 439 Defined Benefit Plans
Pension plans that provide retirement income based on a proportion of the employee’s pay at the time of retirement.
3 - 103 Organizational Commitment
The strength of the individual’s attachment to his or her organization.
256 - 280 Proportional Value Method
Establishes pay equity where no comparator male job class exists by extrapolating a hypothetical male comparator job class based on other male job classes.
3 - 103 Task Identity
The extent to which a worker performs a complete cycle of job activities.
194 - 245 Product/Services Market Constraints
Constraints on compensation strategy caused by the nature of the product or service market in which the firm operates.
107 - 143 Market Pricing
Establishing base pay by determining the average amount of pay other employers are offering for a given job.
3 - 103 Extrinsic Rewards
Factors that satisfy basic human needs for survival and security, as well as social needs and need for recognition.
256 - 280 Job Descriptions
A summary of the duties, responsibilities, and reporting relationships pertaining to a particular job.
424 - 439 Health Care Spending Account
A tax-favoured employee benefit that allows employees to use employer-provided health care spending credits to purchase a wide array of health care services.
107 - 143 Skill Certification
The testing process that determines whether an individual has mastered a given skill block and should be granted the pay raise associated with that skill block.
3 - 103 Routine Technology
Few exceptions occur during the production process, and those exceptions that do occur can be dealt with in a standardized way.
147 - 185 Straight Piece Rate
The same specified sum of money is paid for each piece produced or processed, regardless of how many pieces are produced or processed.
291 - 321 Correlation Coefficient
A statistic that measures the extent to which plots of two variables on a graph fall in a straight line.
291 - 321 Equal Interval Approach
Method to establish pay grade widths, in which the point spreads are equal for all pay grades.
462 - 485 Spiral Career Paths
Career advancement marked by a combination of sideways and vertical progression.
194 - 245 Job Sharing
Two workers who share on full-time permanent job.
3 - 103 Focused Low-cost Business Strategy
A business strategy that depends on providing low-cost products or services to a narrow range of customers.
3 - 103 Optimal Rewards System
The reward system that adds the most value to the organization, after considering all its costs.
3 - 103 Psychological Contract
Expectations about the rewards offered by a given job and the contributions necessary to perform the job.
147 - 185 Straight Commission
Pay that is geared only to the volume of sales or transactions, with no base pay component.
3 - 103 Process Technology
Manufacturing a technology that produces a single product in a continuous flow.
147 - 185 Combination Profit-sharing Plan
A plan that combines the current distribution and deferred profit sharing plans by paying some of the profit-sharing bonus on a current (cash) basis and deferring the remainder.
391 - 415 Family of Measures Plan
A gain-sharing plan that uses a variety of measures to determine the extent to which a bonus payout is justified.
462 - 485 Compensation Cost Ratio
The ratio of total compensation costs to total costs or to revenues.
3 - 103 Skill Variety
The variety of skills required for task completion.
3 - 103 Differentiator Business Strategy
A business strategy that depends on providing unique products or services to a broad range of customers.
3 - 103 Relative Deprivation
Employees experience dissatisfaction under 6 conditions: 1) Discrepency between outcome they want and what they actually receive 2) Their comparison “other” received more than what they do 3) Past experience has led them to expect more than they now receive 4) Expectations for achieving better outcomes are low 5) They feel they are entitled to more 6) The absolve themselves of personal responsibility for the lack of better outcomes.
147 - 185 Current Distribution Profit-sharing Plan
A profit-sharing plan that distributes the profit0sharing bonus to employees in the form of cash or shares, at least annually.
391 - 415 Share Appreciation Rights
A plan through which employees are awarded shares in their employer at no cost to themselves if the price of employer shares rises during a specified period.
194 - 245 Employment Standards Legislation
Legislation that sets minimum standards for pay and other conditions of employment.
256 - 280 Proxy Comparison Method
Established pay equity in public sector organizations where neither the job-to-job method nor the proportional value method can be used.
352 - 379 Forced Distribution Method
A performance appraisal method that stipulates the distribution of employees across the performance categories.
291 - 321 Aging the Data
The process of adjusting compensation data to bring it up to date with the time period in which the new compensation will take effect.
291 - 321 Equal Increase Approach
Method to establish pay grade sizes, in which each pay grade increases in width by a constant number of points from the preceding pay grade.
291 - 321 Base Pay Structure
The structure of pay grades and pay ranges, along with the criteria for movement within pay ranges, that applies to base pay.
3 - 103 Task Behaviour
Occurs when employees perform the tasks that have been assigned to them.
291 - 321 Pay Grade
A grouping of jobs of similar value to the organization, typically grouped by point totals.
107 - 143 Skill-based Pay (SBP)
Pay that is based on the specific skills and capabilities of individual employees, rather than on the specific tasks they are carrying out; usually applied to operational-level employees.
291 - 321 Compa Ratio
A measure of the distribution of employees within their pay range calculated by dividing the mean base pay by the midpoint of the pay range.
194 - 245 Labour Market Constraints
Constraints on compensation strategy flowing from the relative levels of demand and supply for particular occupational groups.
3 - 103 Demographic Characteristics
Age, gender, ethnicity, education, marital status, and similar characteristics.
194 - 245 Lump Sum Approach to Expatriate Pay
Approach to designing expatriate compensation in which various allowance amounts are paid directly in home-country currency.
147 - 185 Pooled Performance Pay
A pay plan in which the performance results of a group are pooled and group member share equally in performance bonus.
194 - 245 Lead Compensation Policy
A compensation-level strategy based on paying above the average compensation level in a given labour market.
3 - 103 Focused Differentiator Business Strategy
A business strategy that depends on providing unique products or services to a narrow range of customers.
391 - 415 Phantom Share Plan
A plan through which employees participate in the appreciation of company shares and any associated dividends, without ever owning any company shares.
291 - 321 Compensable Factors
Characteristics of jobs that are valued by the organization and differentiate jobs from one another.
424 - 439 Flexible Benefit System
An employee benefit plan that allows employees to allocate employer-provided credits to purchase the benefits of most value to them.
3 - 103 Attribution Theory
“Cognitive Evaluation Theory” Theory of motivation arguing that people often act without understanding their motives for their behaviour and afterwar attempt to attribute motives for their actions.
147 - 185 Competitive Bonus Plan
A group pay plan that rewards work groups for outperforming other work groups.
3 - 103 Purpose of a compensation system
To help create a willingness among qualified persons to join the organization and to perform the tasks needed by the organization.
194 - 245 Lag Compensation-level Strategy
A compensation-level strategy based on paying below the average compensation level in a given labour market.
107 - 143 Job Evaluation
Establishing base pay by ranking all jobs in the firm according to their value to that firm.
3 - 103 Analyzer Business Strategy
Focuses on exploiting new opportunities at a relatively early stage while maintaining a base of traditional prducts or services.
3 - 103 Trends in Compensation Systems
The underlying trend has been toward more complicated pay systems. Also, an increase in the use of part-time, temporary, and contract worker (congingent workers). This usually results in poor economic conditions.
147 - 185 Special Purpose Incentive
An incentive designed to motivate a specific type of employee behaviour.
3 - 103 Defender of Business Strategy
Focuses on dominating a narrow product or service market segment.
3 - 103 Incentive
A promise that a specified reward will be provided if a specified employee behaviour is performed.
3 - 103 Human Relations Strategy
Assumes most employees inherently dislike work but can be induced to work in order to satisfy their social needs.
352 - 379 Behavioural Observation
Appraisal method under which appraisers rate the frequency of occurrence of different employee behaviours.
3 - 103 Compensation System
The plan for the mix and total amount of base pay, performance pay, and indirect pay to be paid to various categories of employees.
