PPL - Total Rewards Flashcards
(37 cards)
Compensation provided on an individual basis in the form of goods or services.
Perquisites (“Perks”)
Plan or method implemented by an organization that provides monetary, benefits-in-kind, and developmental rewards to employees who achieve specific business goals.
Total rewards strategy
One-time payment made to an employee.
Lump-sum increase (LSI)
Job evaluation method in which the relative worth and pay structure of different jobs are based on their market value or the going rate in the marketplace.
Market-based job evaluation
Used to group jobs that have approximately the same relative internal or external worth and are paid at the same rate or within the same pay range.
Pay grades
Pay systems in which employee characteristics, rather than the job, determine pay.
Person-based pay
Job evaluation method in which each job is compared with every other job being evaluated; the job with the largest number of “greater than” rankings is the highest-ranked job, etc.
Paired-comparison method
Pay adjustment given to eligible employees regardless of performance or organizational profitability; usually linked to inflation.
Cost-of-living adjustment (COLA)
Provides each incumbent of a job with the same rate of pay, regardless of performance or seniority; also known as flat-rate pay.
Single-rate pay
Situation where an individual’s performance on the job is the basis for the amount and timing of pay increases; also called merit pay or performance-based pay.
Pay for performance (P4P, PfP)
Combining several salary grades or job classifications with narrow pay ranges into one band with a wider salary spread.
Broadbanding
Extent to which employees perceive that monetary and other rewards are distributed equitably, based on effort, skill and/or relevant outcomes.
Internal equity
Job evaluation method in which descriptions are written for each class of jobs; individual jobs are then put into the grade that best matches their class description.
Job classification
Set the upper and lower bounds of possible compensation for individuals whose jobs fall within a pay grade.
Pay ranges
Mandatory or voluntary payments or services provided to employees, typically covering retirement, health care, sick pay/disability, life insurance, and paid time off.
Benefits
Job evaluation method that involves establishing a hierarchy of jobs from lowest to highest based on each job’s overall value to the organization.
Job ranking
Pay rate divided by the midpoint of the pay range.
Compa-ratio
Situation where an individual’s performance on the job is the basis for the amount and timing of pay increases; also called performance-based pay or pay for performance.
Merit pay
Situation where an individual’s performance on the job is the basis for the amount and timing of pay increases; also called merit pay or pay for performance.
Performance-based pay
Provides each incumbent of a job with the same rate of pay, regardless of performance or seniority; also known as single-rate pay.
Flat-rate pay
Job evaluation method in which the relative worth and pay structure of different jobs are based on an assessment of their content and their relationship to other jobs within the organization.
Job-content-based job evaluation
Form of direct compensation where employers pay for performance beyond normal expectations to motivate higher performance.
Incentive pay
Occurs when there is only a small difference in pay between employees regardless of their experience, skills, level, or seniority; also known as salary compression.
Pay compression
Situation in which an organization’s compensation levels and benefits are similar to those of other organizations that are in the same labor market and compete for the same employees.
External equity
