17 terms

Human Resource Management Ch 12

Valentine Jackson Mathis HRM Chapter 12 Variable Pay and Executive Compensation
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variable pay
compensation that is tied to performance
incentives
tangible rewards that encourage or motivate action
piece-rate system
pay system in which wages are determined by multiplying the number of units produced by the piece rate for one unit
bonus
one-time payment that does not become part of the employee's base pay
free rider
member of the group who contributes little
gainsharing
system of sharing with employees greater-than-expected gains in profits and or productivity
profit sharing
system to distribute a portion of the profits of an organization to employees
stock option plan
plan that gives employees the right to purchase a fixed number of shares of company stock at a specified price for a limited period of time
employee stock ownership plan
plan designed to give employees significant stock ownership in their employers
commission
compensation computed as a percentage of sales in units of dollars
draw
amount advanced against, and repaid from, future commissions earned by the employee
salary plus commission
combines the stability of a salary with a commission
perquisites
(perks) special benefits, usually noncash, for executives
stock option
option that gives individuals the right to buy stock in a company, usually at an advantageous price
restricted stock option
option that indicates that company stock shares will be paid as a grant of shares to individuals, usually linked to achieving specific performance criteria
golden parachute
compensation given to an executive if he or she is forced to leave the organization
compensation committee
subgroup of the board of directors that is composed of directors who are not officers of the firm