Exam (elaborations)
Summary HRM3705 SUMMARISED NOTES
- Course
- Institution
Summary HRM3705 SUMMARISED NOTES
[Show more]
Seller
Follow
Content preview
1Jeremiah
Table Of Contents
1.2 What Is Compensation? ............................................................................................................................................................... 8
1.3 The Road Towards Strategic Compensation .......................................................................................................................... 8
1.4 Strategic Activities ......................................................................................................................................................................... 9
1.4.1 COMPETITIVE STRATEGY CHOICES .................................................................................................................................................................................. 9
1.4.2 TACTICAL DECISIONS THAT SUPPORT THE COMPANY’S STRATEGY ............................................................................................................. 10
1.5 Comoensation Professionals’ Goals .......................................................................................................................................10
1.5.1 THE COMPENSATION DEPARTMENT’S MAIN GOALS.............................................................................................................................................. 11
1.5.2 EQUITY/FAIRNESS................................................................................................................................................................................................................. 12
1.5.3 COMPLIANCE WITH LEGAL REQUIREMENTS ............................................................................................................................................................. 13
1.5.4 EFFICIENCY.............................................................................................................................................................................................................................. 13
1.6 Stakeholders Of The Compensation System ........................................................................................................................13
2.2. Meaning Of Strategic Compensation ..................................................................................................................................14
2.2.1. STRATEGIC COMPENSATION MANAGEMENT DEFINED .................................................................................................................................... 14
2.2.2. THE RATIONALE FOR STRATEGIC COMPENSATION.......................................................................................................................................... 14
2.2.3. AIMS OF STRATEGIC COMPENSATION ................................................................................................................................................................... 14
2.2.4. CHARACTERISTICS OF STRATEGIC COMPENSATION ....................................................................................................................................... 15
2.2.5. STRATEGIC COMPENSATION VS. COMPENSATION MANAGEMENT ............................................................................................................. 15
2.2.6. THE PRACTICE OF STRATEGIC COMPENSATION MANAGEMENT ................................................................................................................ 16
2.2.7. COMPENSATION PHILOSOPHY AND GUIDING PRINCIPLES ............................................................................................................................. 16
2.3. Strategic Choces ......................................................................................................................................................................17
2.3.1. SUPPORT BUSINESS STRATEGY ............................................................................................................................................................................... 18
2.4. SUPPORT HR STRATEGYCOMPENSATION STRATEGY: PURPOSE AND CONTENT .................................................................................... 19
2.4.1. WHAT IS COMPENSATION STRATEGY? ...................................................................................................................................19
2.4.2. AIMS OF COMPENSATION STRATEGY .................................................................................................................................................................... 19
2.4.3. STRUCTURE OF COMPENSATION STRATEGY ...................................................................................................................................................... 19
2.4.4. DEVELOPING A COMPENSATION STRATEGY........................................................................................................................................................ 19
, 2
2.4.5 WHEN IS A COMPENSATION STRATEGY A SOURCE OF COMPETITIVE ADVANTAGE? ..............................................................20
3.3. Employment Laws That Influence Compensation Tactics ...............................................................................................21
3.3.1. THE LABOUR RELATIONS ACT 66 OF 1995 (LRA) ....................................................................................................................21
3.3.2. THE EMPLOYMENT EQUITY ACT 55 OF 1998 (EEA) .................................................................................................................22
3.3.3. THE BASIC CONDITIONS OF EMPLOYMENT ACT 75 OF 1997 (BCEA) .....................................................................................22
3.3.4. THE SKILLS DEVELOPMENT ACT 97 OF 1998 (SDA) ................................................................................................................22
3.3.5 THE SKILLS DEVELOPMENT LEVIES ACT 37 OF 2008 (SDL) .....................................................................................................22
, 3
3.3.6. COMPENSATION FOR OCCUPATIONAL INJUROES AND DISEADES ACT 130 OF 1993 (COIDA) ..............................................23
3.3.7. THE INCOME TAX ACT 58 OF 1962, AS AMENDED .............................................................................................................................................. 23
3.3.8. KING REPORT ON CORPORATE GOVERNACE IN SOUTH AFRICA ................................................................................................................... 23
3.4. Labour Unions As Contextual Influences .............................................................................................................................23
3.4.1. LABOUR UNION OVERVIEW ............................................................................................................................................................................................. 23
3.4.2. COMPENSATION ISSUES IN COLLECTIVE BARGAINING........................................................................................................................................ 23
3.4.2.1. UNION INFLUENCE ........................................................................................................................................................................................................... 23
3.5. Influneces On Compensation ...................................................................................................................................................24
3.5.1. MINIMUM WAGES................................................................................................................................................................................................................. 24
3.5.2. PAY GAP AND PAY DISCRIMINATION .......................................................................................................................................................................... 25
3.5.3. COMPARABLE WORTH ...................................................................................................................................................................................................... 25
4.2. Seniority And Longevity Pay ....................................................................................................................................................26
4.3. Merit Paymerit ..............................................................................................................................................................................27
4.3.1. LINKING PAY TO PERFORMANCE ................................................................................................................................................................................. 28
4.3.2. ELEMENTS OF MERIT PAY .............................................................................................................................................................................................. 28
4.3.3. SUCCESSFUL MERIT PROGRAMMES............................................................................................................................................................................ 29
4.4. Performance Appraisal ..............................................................................................................................................................29
4.4.1. TYPES OF PERFORMACE APPRAISAL PLANS ......................................................................................................................................................... 29
4.4.2. EXPLORING THE PERFOMRANCE APPRAISAL PROCESS .................................................................................................................................... 29
4.4.3. SOURCES OF PERFROMANCE APPRAISAL INFORMATION AND ERRORS IN THE PROCESS ................................................................ 30
4.4.4. IMPORTANCE OF PERFORMANCE APPRAISAL AND THE LAW .......................................................................................................................... 30
4.4.5. DETERMINING PAY INCREASES...................................................................................................................................................................................... 30
4.5. Strengthening The Pay-For-Performance Link ....................................................................................................................31
4.6. Possible Limitations Of Merit Pay Programmes .................................................................................................................32
5.1 Introduction ...................................................................................................................................................................................33
5.2 Exploring Incentive Pay ..............................................................................................................................................................33
5.2.1. DIMENSIONS OF INCENTIVES .......................................................................................................................................................................................... 34
5.3. Contrasting Incentive Pay With Traditional Pay..................................................................................................................34
5.4. Individual Incentive Plans .........................................................................................................................................................35
, 4
5.4.1. TYPES OF INDIVIDUAL INCENTIVE PLANS ................................................................................................................................................................. 35
5.5. Group Incentives .........................................................................................................................................................................36
5.5.1. TYPES OF GROUP INCENTIVES...................................................................................................................................................................................... 37
5.5.2. ADVANTAGES AND DISADVANTAGES OF GROUP INCENTIVE PLANS ............................................................................................................ 38
5.5.3. COMPARING GROUP AND INDIVIDUAL INCENTIVE PLANS .................................................................................................................................. 38
5.6. Company-Wide Incentives ........................................................................................................................................................39
5.6.1. PROFIT-SHARING PLANS.................................................................................................................................................................................................. 39
5.6.1.1 TYPES OF PROFIT-SHARING PLANS ......................................................................................................................................................................... 39
5.6.1.2. ADVANTAGES AND DISADVANTAGES OF PROFIT -SHARING PLANS ........................................................................................................... 40
5.6.2. EMPLOYEE STCOK OPTION PLAN ................................................................................................................................................................................ 40
5.6.3. BONUS SCHEMES ................................................................................................................................................................................................................ 40
5.7. Designing Incentive Pay Programmes ..................................................................................................................................40
6.1 Introduction ...................................................................................................................................................................................41
6.2. Defining Different Concepts .....................................................................................................................................................41
6.3. Internal Consistency ..................................................................................................................................................................42
6.4. Job Analysis .................................................................................................................................................................................42
6.4.1. IMPORTANCE OF JOB ANALYSIS .................................................................................................................................................................................. 43
6.4.2. LEGAL CONSIDERATIONS FOR JOB ANALYSIS ....................................................................................................................................................... 43
6.5. Job Evaluation .............................................................................................................................................................................43
6.5.1. PURPOSE OF JOB EVALUATION ................................................................................................................................................................................... 44
6.5.2. COMPENSABLE FACTORS ................................................................................................................................................................................................ 44
6.5.3. JOB EVALUATION PROCESS ........................................................................................................................................................................................... 45
6.5.4. JOB EVALUATION TECHNIQUES/METHODS............................................................................................................................................................... 45
6.5.5. MAIN JOB EVALUATION SUSTEMS IN USE IN SA .................................................................................................................................................. 46
6.5.6. ALTERNATIVE TO JOB EVALUATION ........................................................................................................................................................................... 46
6.6. Internal Consistent Compensation Systems And Competitive Strategy ......................................................................47
7.2 Market-Competitive Pay Systems: The Basic Building Blocks ........................................................................................48
7.2.1 COMPENSATION COMPETITIVENESS.............................................................................................................................................................................. 49
7.2.1.1 LABOUR MARKET .............................................................................................................................................................................................................. 49
7.2.1.2 PRODUCT MARKET ........................................................................................................................................................................................................... 49
7.2.1.3 ORGANISATION................................................................................................................................................................................................................... 49
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Denyss. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $5.99. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
64438 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now