One Page Reviewer Chapter 11

1. Employee Compensation : includes all forms of pay going to employees and arising from their employement.
2. Direct Financial Payments : (wages, salaries, incentives, commissions and bonuses).
3. Indirect Financial Payments : (financial benefits, like employer paid insurance and vacations.)
4. Equity Theory of Motivation : postulates that people are strongly motivated to maintain a balance between what they perceive as rewards.
5. 4 Forms of Equity : (External, Internal, Individual, Procedural)
6. External Equity : refers to how a job’s pay rate in one company compares to the job’s pay rate in other companies.
7. Internal Equity : refers to how fair the job’s pay rate is when compared to other jobs within the same company.
8. Individual Equity : refers to the fairness of an individual’s pay s compared with what his or her coworkers are earning for the same job.
9. Procedural Equity : refers to the perceived fairness of the processes and procedures used to make decisions regarding the allocation of pay.
10. Davis-Bacon Act : lets the secretary of labor set wage for laborers and mechanics employed by contractors working for the government.
11. Walsh-Healey Public Contract Act : sets basic labor standards for employees working on any government contract that amounts to more than $10,000
12. Fair Labor Standards Act : contains minim wage, maximum hours, overtime pay, equal pay ...
13. Employee Retirement Income Security Act (ERISA) : protect employees against the failure of their employer’s pension plans.
14. Portability Rights : the transfer of an employee’s vested rights from one organization to another.
15. Job Evaluation : formal and systematic comparison of jobs to determine the worth of one job relative to another,
16. Compensable Factor : fundamental, compensable element of a job such as skills effort, responsibility and working conditions.
17. Benchmark Job : used to anchor the employer’s pay scale and around which other jobs are arranged in order of relative worth.
18. Ranking Method : simplest method of job evaluation that involve ranking each job relative to all other jobs.
19. Steps in Job Ranking Method : (Obtain job information , Select and group jobs, Select compensable factors, Rank jobs)
20. Factor Comparison Method : a considerable more complicated method of ranking jobs according to various skill and diffullcty factors.
21. Job Classification or Job Grading : widely used job evaluation method in which rates categorize jobs into groups.
22. Classes: if task contains similarjobs.
23. Grades : if job contains same level of difficulty.
24. Point Method : determine the degree to which the jobs you’re evaluating contain selected compensable factors.
25. Grade definition : written descriptions of the level of responsibility and knowledge required by jobs.
26. 16 steps in creating a market competitive pay plan : (Choose Benchmark Jobs, Select Compensable Factors, Assign Weights to Compensable Factors,
Convert Percentages to points for each factor, Define each facto’s degrees, Determine for Each factor its factor degree’s points, Review Job Description
and Job Specfications, Evaluate Jobs, Conduct a Market Analysis; Salary Surveys, Draw the Market Wage Curve, Compare and adjust Current and Market
Wage Rates for Jobs, Dvelop Pay Grades, Establish Rate Ranges, Adress Remaining Jobs, Correct Out-of-Lines Rates.
27. Wave Curve : shows the relationship between the value of the job and the average wage paid for ths job..
28. Market Competitive pay System : a pay system in which the employer’s actual pay rates are competitive with those in the relevant labor market.
29. Salary Survey : aimed at determining prevailing wage rates.
30. Pay or wage Grade : is compirised of jobs of approximately equal difficulty.
31. Pay or rate changes : a series of steps or levels within a pay frade, usually based upon years of service.
32. Comparable Ratio : equalsan employee’s pay rate divided by the pay range midpoint for his or her pay grade.
33. Competency Based Pay : it is where the company pays for the eplyee’s range,depth, and types of skills and knowledge rather than for the job title he or
she holds.
34. Broadbanding : consolidating salary grades and ranages into just few wide levels’ or bands, ‘ each of which contains a relatively wide range of jobs and
salary levels.
35. Comparable Worth : refers to the requirement to pay men and women equal wages of jobs that are comparable value to the employer.
36. Total Rewards – encompass te traditional compensation components, but also things such as recognition and redesigned more challenging jobs.
37. Managerial pay : consists of base pay, short-term incentives, and executive benefits.