Compensation - Answer-The total of an employees pay and benefits
Compensation System - Answer-Includes anything that an employee may value or desire and that the employer is willing and able to offer in exchange
Compensation Components - Answer-All rewards classified as monetary payments and ...
MGMT 443 Exam 3 Questions with
Verified Answers
Compensation - Answer-The total of an employees pay and benefits
Compensation System - Answer-Includes anything that an employee may value or
desire and that the employer is willing and able to offer in exchange
Compensation Components - Answer-All rewards classified as monetary payments and
all in kind payments
non compensation components - Answer-all rewards other than monetary and in kind
payments ( company cafeteria or gym)
Base Pay - Answer-Hourly (wages) or salary
Wage and salary add-ons - Answer-overtime pay, shift differential, premium pay for
working weekends and holidays
Incentive Pays - Answer-(variable pay) This is a pay for performance and commonly
include piecework in production and commission sales
Benefits - Answer-Indirect compensation that provides something of value to the
employee
Direct Compensation - Answer-(Base pay + any add ons + incentive pay)=
Indirect compensation - Answer-Benefits
Expectancy Theory - Answer-Proposes that employees are motivated when they
believe they can accomplish a task and the rewards for doing so are worth the effort
Instrumentality - Answer-The perception of the likelihood of a particular level of
performance providing the individual with a desired reward
Expectancy - Answer-A persons perception of their ability to accomplish an objective
Valence - Answer-Refers to the value a person places on the outcome or reward
Equity Theory - Answer-Proposes that employees are motivated when the ratio of their
perceived outcomes to inputs is at least roughly equal to other referent individuals
Under rewarded - Answer-When employees perceive that they are under warded they
may try to reduce the inequity by increasing outcomes and decreasing inputs
, Overrewarded - Answer-If employees think they are over rewarded than they may work
harder
Equitably Rewarded - Answer-When inputs and outputs are perceived as being equal
Efficiency Wage Theory - Answer-Says that if a company pays higher wages, it can
generally hire better people who will in turn be more productive
Wage Compression - Answer-Occurs when new employees require higher starting pay
than the historical norm, causing narrowing of the pay gap between experienced and
new employees
Pay Secrecy - Answer-a workplace policy that prohibits employees from discussing how
much money they make
Fair Labor Standard Act (FLSA) - Answer-The major provisions cover minimum wage,
overtime issues, and child labor rules
Minimun Wage - Answer-The lowest hourly rate of pay generally permissible by federal
law
Overtime - Answer-A higher-than-minimum, federally mandated wages, required for
nonexempt employees if they work more than a certain number of hours in a week
Job Evaluation - Answer-The process of determining the worth of each positions relative
to other positions within the organization
Job Ranking method - Answer-Easy and fast. Just rank each position. Can be limited
because its more subjective than objective in form
Point-factor Method - Answer-The hay guide is the most well know point factor method.
These attempt to be completely objective by breaking the job into components and then
applying points to each factor based on the factors difficulty.
Factor Comparison Method - Answer-Combines the ranking and point-factor method to
provide a more thorough form of job evaluations
Pay Structure - Answer-A hierarchy of jobs and their rates of pay within the organization
Rate Range - Answer-Provides the maximum, minimum and midpoint of pay for a
certain group of jobs
Delayering - Answer-The process of changing the company structure to get rid of some
of the vertical hierarchy in an organization
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