MGMT 343 Final Ch. 11

refers to the relative pay of different jobs (job structure) and how much they are paid (pay structure)

the average pay in organizations, including wages, salaries, and bonuses

the relative pay of jobs in organizations (i.e., the range of pay often expressed by salary grades)

- A philosophy that considers employees to be an investment that will yield valuable returns
- Controlling costs through noncompetitive pay can result in low employee productivity and quality
- Pay policies and programs are one of the most important human resource tools for encouraging desired employee behaviors and discouraging undesired behaviors

At (match)
Below (lag)
Above (lead)

(done through market pay surveys)

a procedure by which an organization compares its own practices against those of the competition.

The following issues must be determined before pay structures are used:
- Which employers should be included in the survey?
- Which jobs are included in the survey?
- If multiple surveys are used, how are all the rates of pay weighted and combined?

an administrative procedure that measures a job's worth to the organization

the evaluation process is composed of 'compensable factors'

the characteristics of jobs that an organization values and chooses to pay for

A mathematical expression that describes the relationship between a job's pay (the salaries you gathered through benchmarking) and its job evaluation points (determined through using the Point Factor Method of job evaluation)

different employees in the same job may have different pay rates

ex) Civil Engineers make from $75,000 to $115,000 in XYZ firm with minimum being $75K, mid point being $95K and maximum being $115K

grouping jobs of similar worth or content together for pay administration purposes

ex) Civil Engineers are in pay grade 2 with a job evaluation point range from 500-700.

- the effect of ______ is likely to be an impact on employees' perceptions of equity.
- Managers must be prepared to explain to employees why the pay structure is designed the way it is and to judge whether the changes to structure should be made.

law prohibits discrimination in all employment outcomes, including pay, unless business necessity can be proven

- the proportion of wages that women earn compared to men was 81% in 2006
- the proportion of black to white earnings in 2006 was 80%

established a minimum wage and overtime pay rate

the lowest amount that employers are legally allowed to pay

- executive, professional, administrative, and outside sales are exempt from FLSA coverage

executive, professional, administrative, and outside sales are exempt from FLSA coverage, and they are not eligible for overtime pay

- just over 20% of employees fall into the exempt category

occupations are covered and include most hourly jobs