Notes This preview shows page 3 - 5 out of 46 pages.
internal equityThe perceived fairness of the paystructure within a firm.external equityThe perceived fairness in pay relativeto what other employers are payingfor the same type of labor.FIGURE 10.2The Nine Criteria for Developing a Compensation Plan1.Internal Versus External EquityWill the compensation plan be perceived as fair within the company,or will it be perceived as fair relative to what other employers are paying for the same type of labor?2.Fixed Versus Variable PayWill compensation be paid monthly on a fixed basis—through base salaries—or will it fluctuate depending on such preestablished criteria as performance and company profits?3.Performance Versus MembershipWill compensation emphasize performance and tie pay to individualor group contributions, or will it emphasize membership in the organization—logging in a prescribednumber of hours each week and progressing up the organizational ladder?4.Job Versus Individual PayWill compensation be based on how the company values a particular job,or will it be based on how much skill and knowledge an employee brings to that job?5.Egalitarianism Versus ElitismWill the compensation plan place most employees under the samecompensation system (egalitarianism), or will it establish different plans by organizational level and/oremployee group (elitism)?6.Below-Market Versus Above-Market CompensationWill employees be compensated at below-marketlevels, at market levels, or at above-market levels?7.Monetary Versus Nonmonetary AwardsWill the compensation plan emphasize motivating employeesthrough monetary rewards like pay and stock options, or will it stress nonmonetary rewards such asinteresting work and job security?8.Open Versus Secret PayWill employees have access to information about other workers’ compensationlevels and how compensation decisions are made (open pay), or will this knowledge be withheld fromemployees (secret pay)?9.Centralization Versus Decentralization of Pay DecisionsWill compensation decisions be madein a tightly controlled central location, or will they be delegated to managers of the firm’s units? We have textbook solutions for you! The document you are viewing contains questions related to this textbook. South-Western Federal Taxation 2020: Corporations, Partnerships, Estates and Trusts Raabe/Young/Nellen/Hoffman 314PART V • COMPENSATIONTHE DISTRIBUTIVE JUSTICE MODELThedistributive justice modelof pay equity holds thatemployees exchange their contributions or input to the firm (skills, effort, time, and so forth) fora set of outcomes. Pay is one of the most important of these outcomes, but nonmonetary rewards,such as a company car, may also be significant. This social–psychological perspective suggeststhat employees are constantly (1) comparing what they bring to the firm to what they receive inreturn and (2) comparing this input/outcome ratio with that of other employees within the firm.Employees will think they are fairly paid when the ratio of their inputs and outputs is equivalentto that of other employees whose job demands are similar to their own.THE LABOR MARKET MODELAccording to thelabor marketmodel of pay equity, the wage ratefor any given occupation is set at the point where the supply of labor equals the demand for laborin the marketplace (W1inFigure10.3). In general, the less employers are willing to pay (lowdemand for labor) and the lower the pay workers are willing to accept for a given job (high sup-ply of labor), the lower the wage rate for that job.13The actual situation is a great deal more complicated than this basic model suggests. Peoplebase their decisions about what jobs they are willing to hold on many more factors than justpay. Moreover, the pay that an employer offers is based on many factors besides the number ofavailable people with the skills and abilities to do the job. A complete exploration of this topicis beyond the scope of this book. However, the basic point of the labor market model is thatexternal equity is achieved when the firm pays its employees the “going rate” for the type ofwork they do.14For a growing number of managerial, professional, and technical occupations,the “going rate” is determined not only by local and domestic factors, but also by global forces.15 Upload your study docs or become a Course Hero member to access this document Upload your study docs or become a Course Hero member to access this document End of preview. Want to read all 46 pages? Upload your study docs or become a Course Hero member to access this document Tags The Land, Salary, Employment compensation We have textbook solutions for you!The document you are viewing contains questions related to this textbook. The document you are viewing contains questions related to this textbook. South-Western Federal Taxation 2020: Corporations, Partnerships, Estates and Trusts Raabe/Young/Nellen/Hoffman Expert Verified Is the perceived fairness in pay relative to what other employers are paying for the same type of labor?The perceived fairness of what an employer pays, relative to what other employers pay for the same type of labor, is known as: external equity.
What refers to the fairness of pay rates across jobs within an organization?Internal Equity - criterion used to determine fairness in pay among employees of an organization. Internal Equity Adjustment - pay action that is taken to correct a salary inequity among employees in the same job with comparable qualifications and performance levels.
Which form of equity refers to the perceived fairness of the processes used to make decisions regarding the allocation of pay?Procedural equity refers to the perceived fairness of the processes and procedures used to make decisions regarding the allocation of pay.
Which term refers to the concept of equal pay for work of equal value?Pay equity is also known as equal pay for work of equal value. That means if two different jobs contribute equal value to their employer's operations then the employees in those positions should receive equal pay.
|
Which of the following refers to the perceived fairness of pay relative to what other employers are paying for the same type of labor?
zusammenhängende Posts
Urheberrechte © © 2024 ketiadaan Inc.
