9          Managing Compensation

A.  Strategic Compensation Planning

                Why is this planning important, how can it impact organizations success, and how are fast food

                companies adjusting?

                1.  Linking Compensation to Organizational Objectives

                                Explain Figure 9.1

                                What are common goals of strategic compensation policy?

                                Formal statements of compensation policy usually include:

2.  Pay for Performance Standard:  standard by which managers tie compensation to performance.

                                What are some results of  pay for performance and why is it difficult to establish?

                                A.  Can employees be motivated through compensation?  Explain.

                                B.  Explain Pay Equity

                                C.  Explain Expectancy Theory and Pay

                                D.  Explain Pay Secrecy

                3.  The Bases for Compensation.

                                Explain the four big difinations.

B.  The Wage Mix (Explain each of the following)

                1.  Internal Factors

                                A.  Compensation Strategy

                                B.  Worth of a Job

                                C.  Employees Relative Worth

                                D.  Employer’s Ability to Pay

                2.  External Factors

                                A.  Labor Market Conditions

                                B.  Area Wage Rates

                                C.  Cost of Living

                                D.  Collective Bargaining

C.  Job Evaluation Systems:  used to determine the relative worth of jobs in order to establish pay

                1.  Job Ranking System (explain some different kinds of ranking systems)

                2.  Job Classification System (how does it work and what is the best example?)

                3.  Point System (what are the major components and how does it work?)

                4.  Factor Comparison System (what is the basis for evaluation?)

                5.  Job Evaluation for Management Positions (how is this done?)

D.  Compensation Structure – making the numbers work

                1.  Wage and salary Surveys

                                a.  Collecting Survey Data

b.   HRIS and Salary Surveys

c.  Employer-Initiated Surveys

                2.  The Wage Curve

                3.  Pay Grades

                4.  Rate Ranges

                5.  Compensation-Based Pay

E.  Regulation

                1.  Davis-Bacon Act

                2.  Walsh-Healy Act

                3.  FLSA  (be sure to explain wage and hour, child labor, exemptions, and equal rights)

F.  BIG ISSUES

                1.  Explain Comparable Worth and Challenges with it

                2.  Explain Wage-Rate Compression

                3.  What are Living-Wage Laws and what is the issue of Low Salary Budgets?

CASE:  Pay Decisions at Performance Sports