What shows the relationship between the value of a job and the average pay rate for the job?

Q: What shows the relationship between the value of the job and the average wage paid for this job?

For this purpose, wage curve is used to help assign pay rates to each pay grade (or to each job). It shows the relationship between the value of the job and the average wage paid for this job.

Q: What is the purpose of the wage curve?

In brief, the wage curves purpose is to show the correlation of a jobs value and the prevalent average pays for jobs in the same pay grade within a company. It considers the job already evaluated by any of the job evaluation methods.

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There are two basic ways to make direct financial payments to employees: base them on increments of time or on performance. Time-based pay is still the foundation of most employers' pay plans. Blue-collar and clerical workers get hourly or daily wages, for instance, and others, like managers or Web designers, tend to be salaried and paid by the week, month, or year. The second direct payment option is to pay for performance. Piecework and sales commissions are examples of performance-based compensation. Developing compensation plans for managers or professionals is similar in many respects to developing plans for any employee. The basic aim is the same: to attract and keep good employees. Managerial jobs tend to stress harder to quantify factors like judgment and problem solving more than do production and clerical jobs. There is also more emphasis on paying managers and professionals based on results—based on their performance or on what they can do—rather than on the basis of static job demands like working conditions. So, job evaluation, although still important, usually plays a secondary role to non-salary issues like bonuses, incentives, market rates, and benefits.

There are many advantages to organizations. The Fair Labor Standards Act does not apply to independent contractors. The employer does not have to pay unemployment compensation, payroll taxes, Social Security taxes, or city, state, and federal income taxes.
In general, an individual is an independent contractor if the payer has the right to control or direct only the result of the work and not what will be done and how it will be done. However, there is no single rule or test. Instead, the courts will look at the total situation. The major consideration is this: The more the employer controls what the worker does and how he or she does it, the more likely it is that the courts will find the worker to be an employee, not an independent contractor.

Employers have different ways of handling cost-of-living differentials. One is to give the transferred person a nonrecurring payment in a lump sum amount. Another is to pay a differential for ongoing costs in addition to a one-time allocation. Others simply raise the employee's base salary.
For international transfers, companies can go with a home-based or host-based salary plan.
With a home-based salary plan, an international transferee's base salary reflects his or her home country's salary. The employer then adds allowances for cost-of-living differences-housing and schooling costs, for instance. This is a reasonable approach for short-term assignments, and avoids the problem of having to change the employee's base salary every time he or she moves.
In the host-based plan, the firm ties the international transferee's base salary to the host country's salary structure. In other words, the manager from New York who is sent to France would have his or her base salary changed to the prevailing base salary for that position in France, rather than keep the New York base salary. The firm usually tacks on cost-of-living, housing, schooling, and other allowances here as well.
Most multinational enterprises set expatriates' salaries according to the home-based salary plan.

Job evaluation aims to determine a job's relative worth. The job evaluation is a formal and systematic comparison of jobs to determine the worth of one job relative to another. Job evaluation eventually results in a wage or salary structure or hierarchy (this shows the pay rate for various jobs or groups of jobs). The basic principle of job evaluation is this: Jobs that require greater qualifications, more responsibilities, and more complex job duties should receive more pay than jobs with lesser requirements. Many employers use job evaluation for pricing managerial jobs in most large firms. The basic approach is to classify all executive and management positions into a series of grades, each with a salary range. As with non-managerial jobs, one alternative is to rank the executive and management positions in relation to each other, grouping those of equal value. However, firms also use the job classification and point evaluation methods, with compensable factors like position scope, complexity, and difficulty. Job analysis, salary surveys, and the fine-tuning of salary levels around wage curves also play roles.

For a CEO position, job evaluation typically has little relevance. One recent study concluded that three main factors: job complexity (span of control, the number of functional divisions over which the executive has direct responsibility, and management level), the employer's ability to pay (total profit and rate of return), and the executive's human capital (educational level, field of study, work experience) accounted for about two-thirds of executive compensation variance. There are various reasons why boards are clamping down on executive pay. The Dodd-Frank law of 2010 requires American companies give shareholders a "say on pay." Law firms are filing class-action suits demanding information from companies about their senior executives' pay decisions. As of 2007, the Securities and Exchange Commission (SEC) required filing more compensation-related information, including a detailed listing of all individual "perks" or benefits if they total more than $100,000. As of 2005, the Financial Accounting Standards Board required that most public companies recognize as an expense the fair value of the stock options they grant. The Sarbanes-Oxley Act makes executives personally liable, under certain conditions, for corporate financial oversight lapses.

Homelife, a national chain of high-end furniture stores, employs nearly 800 workers. In the past few years, the company's market share has dropped significantly, and employee turnover has increased. Upper management is considering the implementation of a new compensation policy in its efforts to turn the company around. Historically, the company has paid all employees similarly with some variation for seniority but no distinction between high and low performers.
Which of the following, if true, best supports the decision by Homelife executives to implement competency-based pay?
A) Homelife will be using the comparable worth method of determining pay to avoid legal problems.
B) Most Homelife managers are men, but executives hope to increase the number of minority women working for the company.
C) Homelife plans to organize employees into teams, provide regular training, and frequently assess workers' skills and knowledge.
D) In an effort to save money, Homelife will be reducing the employee training budget over the next three years.

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What shows the relationship between the value of the job and the average wage paid for this job?

For this purpose, 'wage curve' is used to help assign pay rates to each pay grade (or to each job). It shows the relationship between the value of the job and the average wage paid for this job.

What determines the value of a job?

According to most economics textbooks, our wages are determined just like any other price: by supply and demand. People supply their labor, and companies demand it, creating a market for labor.

What is the purpose of the wage curve?

In brief, the wage curve's purpose is to show the correlation of a job's value and the prevalent average pays for jobs in the same pay grade within a company. It considers the job already evaluated by any of the job evaluation methods.

Which method do companies use to determine job worth quizlet?

The worth of a job is determined formally through the wage and salary survey. The worth of a job, as it is determined by its comparative worth with jobs in other firms, is an external factor in the wage mix.