37:533:301 Lecture Notes - Lecture 3: Distributive Justice, Job Performance, Job Analysis
6 Apr 2016
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Primary way of motivating and retaining good employees. Bad pay can hinder the effectiveness of other good hr programs. One quarter of a company"s revenue goes to pay (so you need to invest it wisely!!!) So, our goal is to attract, motivate, and retain employees while keeping labor costs under control. Pay structure - the structure of pay within the entire firm. Pay level: average pay in the whole firm. Job structure: relative pay of different jobs within firm. Individual pay - subject of the next chapter and lecture. Many firms are too big to make pay decisions based on individual merit. Employees doing the same job should make around the same amount of money. It influences distributive justice - the perceived fairness of decision outcomes. According to equity theory, distributive justice is high when an employee"s ratio of outcomes to inputs matches those of some comparison other .
