Pay structure correct answers refers to the way in which an organization applies pay rates to different jobs, skills, or competencies. An effective pay structure is an important part of an organization's broader compensation and reward systems, and it is important for attracting and retaining talen...
MGT 420 || QUESTIONS WITH 100% SOLVED
SOLUTIONS.
Pay structure correct answers refers to the way in which an organization applies pay rates to
different jobs, skills, or competencies. An effective pay structure is an important part of an
organization's broader compensation and reward systems, and it is important for attracting
and retaining talented individuals, as well as for motivating existing workers to achieve
higher levels of performance.
Further, an effective pay structure distributes pay fairly, competes with the pay practices of
other organizations, and abides by federal, state, and local employment and labor laws.
Reward system correct answers The policies, procedures, and practices used by an
organization to determine the amount and types of returns individuals, teams, and the
organization receive in exchange for their membership and contributions"
Total compensation correct answers "Package of compensation and benefits that employees
receive"
Relational returns correct answers "Nonmonetary incentives and rewards, such as new
learning and developmental opportunities"
Benefits correct answers "Employee rewards, which are a type of indirect pay, that include
health, life, and disability insurance; retirement programs; and work-life balance programs"
Equity theory correct answers "Provides a way of understanding how an individual's sense of
fairness is influenced by others with whom they compare themselves"
Organizational justice theory and the types of justice (e.g. distributive, procedural, etc.)
correct answers "Organizational justice theory: A theory that focuses on perceptions of
fairness in the workplace"
"Distributive justice: The perceived fairness or equity regarding the allocation of an outcome
or resource, which can include rewards, punishments, or other organizational consequences"
"Procedural justice: The perceived fairness of the process used to determine how an outcome
or resource is determined and distributed"
Internal equity correct answers "The fairness of pay rates across jobs within an organization"
Compa-ratio correct answers "A ratio that reflects how much employees are actually paid for
a given job or pay grade as compared to the espoused pay structure and policies and thus can
be used to assess whether systematic compression or inversion are occurring"
Job structure correct answers "The ranking of jobs within an organization based on their
respective worth"
Job evaluation and the methods correct answers Job evaluation: A systematic process used to
determine the relative worth of jobs within an organization
There are primarily three methods of job evaluation: (1) ranking, (2) classification, (3) Factor
comparison method or Point method.
, Broadbanding correct answers "The process of collapsing multiple pay grades into one large
grade with a single minimum and maximum"
Market strategies (re: ensuring external equity) correct answers "External equity: The extent
to which the pay for a particular job is competitive and fair relative to the pay of the same or
similar jobs at other organizations"
Ensuring Internal and External Pay Equity
1. Compensation market study. Make sure you are staying up-to-date on what the external
market is paying for the jobs in your store. ...
2. Hiring rates. Many co-ops unilaterally offer the beginning pay rate for the pay range a new
hire is in. ...
3. Consistency with raises. ...
Adjust pay as needed.
Aging correct answers "A process whereby previously collected market pay data are adjusted
and updated based on market changes due to merit-based increases, cost-of-living
adjustments, and other factors that affect pay"
Pay for performance correct answers "Financial rewards offered in exchange for meeting
certain levels of performance or achieving certain goals"
Piecework plans (e.g. differential, etc.) correct answers Piecework plans: An individual-
incentive program in which employees are compensated based on their respective production
levels"
Differential piecework plan: An individual-incentive program in which employees are paid
one rate for units produced below a particular standard in a given time period and a higher
rate for units produced above that standard
Straight piecework plan: An individual-incentive program in which employee variable pay is
based on the units they produce in a given time period, such that there is a direct
correspondence between the amount of pay distributed and the number of units produced"
Traditional pay plan correct answers "Compensation programs that reward employees based
on the content of their job description, title, and/or level"
Intrinsic & extrinsic motivation correct answers "Intrinsic motivation: A force that originates
inside an individual and compels the individual to action because they perceive the action as
innately rewarding"
"Extrinsic motivation: An external, environmental force that compels an individual to action"
Reinforcement theory including who developed it correct answers "A motivational theory
that provides a useful framework for understanding pay as an extrinsic motivator, particularly
when pay is used for behavior modification"
Behaviorist B.F. Skinner derived the reinforcement theory, one of the oldest theories of
motivation
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