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orgb 327 vocab exam questions and answers
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orgb 327 vocab exam questions and answers
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orgb 327 vocab exam questions andanswers
Compensation maxim - Answer -An ethical principle that describes how compensation
should be determined.
Determinants of pay - Answer -The factors that influence pay, including external factors,
organizational factors, job factors, and individual factors.
Individual wage decision - Answer -The wage decision that considers the issue of
whether individuals performing the same job should all receive the same rate of pay or
different rates of pay.
Labor markets - Answer -Segments of the overall job market used for analyzing wage
and salary levels.
Pay secrecy - Answer -A policy that restricts employees from discussing their pay and
limits the amount of information about pay that can be made public.
Salary - Answer -A compensation arrangement that pays employees on a period basis
rather than an hourly one.
Wage-level decision - Answer -The wage decision that compares the wages paid in one
organization with the pay in other organizations for employees performing similar work.
Wage-structure decision - Answer -The wage decision that examines how much money
is paid for different jobs within the same organization.
Wage survey - Answer -A review of the wages, salaries, and benefits offered by
different organizations.
Percentage increase - Answer -A procedure used for adjusting the pay levels in which
the pay for every job is increased by a fixed percentage amount.
Point method - Answer -A job-evaluation method where key jobs are used to develop
the wage curve by assigning points to compensable factors and associating total points
with a specific pay level.
,Productivity - Answer -The total goods and services produced by society divided by the
total number of employee hours required to produce them.
Red-circle jobs - Answer -Jobs that are either overpaid or underpaid relative to the
amount the wage curve indicates ought to be paid for them.
Step increases - Answer -Pay increases that are based on performance and length of
service.
Topped out - Answer -When employees receive pay increases to the point that their
salaries are at the top of their pay ranges.
Wage compression - Answer -A reduction in the relative wage differentials between high
and low-paying jobs.
Wage curve - Answer -The line on a wage structure graph that shows higher levels of
pay associated with higher-level jobs.
Broad-banding - Answer -Creating wide labor grades so that there are fewer labor
grades with more jobs in each one
Classification method - Answer -A procedure used to develop a wage structure in which
the job descriptions for each job are compared with a description that ranks the jobs in a
hierarchy of job worth.
Compa-ratio - Answer -A number that compares a person's pay rate with the midpoint of
the pay range.
Compensable factors - Answer -The factors associated with the different jobs that justify
paying one job more than another.
Consumer Price Index - Answer -A well-accepted measure of the rate of inflation.
Cost-of-living adjustment - Answer -A procedure that provides for automatic increases in
the level of pay based on the rate of inflation.
Decreasing-rate increase - Answer -A procedure for adjusting the wage curve in which
higher-level jobs are increased by successively smaller amounts.
Factor comparison - Answer -A method for developing a wage structure in which
benchmark jobs are compared with other jobs, factor by factor, to determine how much
money should be paid for each factor.
Fixed-rate increase - Answer -A procedure for adjusting the wage curve in which a fixed
sum of money is added to every job in the hierarchy.
, Hay Method - Answer -A widely-used job evaluation method that uses three
compensable factors—knowhow, problem solving, and accountability to determine how
many points should be assigned to different jobs.
Job evaluation - Answer -A procedure for developing a wage structure that is based on
an analysis of the job.
Job pricing - Answer -The process of deciding how much each job should be paid by
determining which labor grade the job falls within and the pay range for that labor grade.
Job-ranking method - Answer -A procedure for developing a wage structure that
involves ranking the various jobs in a hierarchy of job worth and then assigning
monetary values to them.
Key jobs - Answer -Jobs that are considered equitably paid and are used in the point
method to develop a wage structure.
Pay grade - Answer -A cluster of jobs along the hierarchy of job worth that are all paid
the same rate of pay.
Pay range - Answer -The range of pay associated with each pay grade, which indicates
how much individual incentive is associated with the job.
Piece rates - Answer -The amount of money that an employee receives for performing a
particular unit of work.
Reinforcement theory - Answer -A theory of motivation that says behavior is determined
by the types of rewards or punishments associated with the behavior.
Rucker Share-of-Production Plan - Answer -A company-wide incentive plan in which
compensation is based on a ratio of income to value added by the employees in the
production process.
Scanlon Plan - Answer -A company-wide incentive plan that combines profit sharing
with a suggestion system.
Soldiering - Answer -Producing less than is possible when peer-groups establish an
arbitrarily low standard of performance.
Standard hour plan - Answer -An individual or group incentive plan that pays a fixed rate
per hour where the hour is measured by an hour's worth of work rather than by a
standard 60 minutes.
Stock option - Answer -A part of the executive compensation program that allows
employees to buy shares of the company's stock, usually at a reduced price.
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