MGHB12H3 Chapter Notes - Chapter 9: Equal Pay For Equal Work, Job Evaluation, Equity Theory
Document Summary
Pay system helps attract and retain top talent and motivate employees, drives employee behaviours, sends important signals on company values. Compensation consists of 3 main components: direct compensation (employee wages and salaries, incentives, bonuses and commissions, indirect compensation (benefits supplied by employers, nonfinancial compensation (employee recognition programs, rewarding jobs, organizational support, work environment, flexible work hours) To remain competitive in the labour market. To mesh employees future performance with organizational goals. Hourly work work paid on hourly basis. Piecework work paid according to the number of units produced. Combination of internal and external factors can influence rates which employees are paid: internal: Employer"s compensation strategy (at min, policies should reflect 1. Internal wage relationship among jobs and skill levels, 2. External competition or an employer"s pay position relative to what competitors are paying, 3. Administrative decisions concerning elements of the pay system such as overtime premiums) Worth of job (based on the total value delivered to: external: organization)
