Comp & Performance Appraisal Final 1/2

Equity Theory
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Terms in this set (45)
Egalitarian pay structuresteams, not a big difference b/t highest and lowest person, treated equally, more cooperationtournament theoryincreased competition and performance when there is an opportunity for big bonuses in achieving end resultJob analysisthe systematic method of discovering and describing differences and similarities among jobsJob descriptionthe list of tasks, duties, and responsibilities that make up a job - observable actionsJob specificationwhat kind of person could do this job? the list of knowledge and other characteristics necessary for the jobessential elements of a jobfor the ADA - the minimum stuff someone has to be able to do for the jobBroad vs specific job analysisBroad: more flexibility, can move around, job crafting (negative: job creep) - ers usually like this Specific: ees know exactly what to do - liked more by eestransactional workdirect work - you are told the exact steps to get something donetacit worktask where you have to read the situation, no exact steps. EX "keep up ee morale"Pros and Cons of skill-based plansPros: ees work harder, they want to work more and learn new skills - ees who you can cross train Cons: labor costs increase, sometimes you're paying people to be kind of good at lots of things but not great at everything (paying for things they might not be doing)Pros and Cons of competency-based plansEX. building workplace effectiveness Pros: ees want to gain more skills to get paid more Cons: hard to measure, ambiguous. Are they actually doing them? Or do they just know how to?labor market supply and demandif supply goes up, you will be paid more. if supply goes down, you will be paid less. the equilibrium of supply and demand determines your pay (middle)labor supply assumptionspotential employees... 1) are always seeking jobs 2) there is accurate info available about all job openings 3) no barriers to mobility -supply and demand does not always predict laborcompensating differentialsees offered higher wages for a job that has negative characteristics EX. night shift has higher pay per hour EX. hazard pay in the army3 pay-level policiesLead: trying to get the very best talent Meet/match: stick around with everyone else Lag: paying less to save money (people might be staying if they are promised future stock options OR if you create a great work environment)Pay gradesjobs grouped together by levelpay rangesjobs grouped together - how much you are paidpay grade overlapsometimes an overlap in the ranges of how much you get paid (between levels, having to do with max, min)broad bandingswitch from lots of pay grades to bands. more about performance than about title of jobWhat do ees prefer pay systems to be influenced by?individual performance, change in cost of living, seniority, market ratemerit pay planspaying based on how well you performed the previous year. concerns: 1) can increase fixed compensation costs over time 2) becomes costly if there are too many high performance ratings 3) too small to motivate performance (at least 5% is good) 4) hard to measure individual performancecompa-ratiopeople on the lower end get paid higher raises to bring them to a higher levelspot awardssee a good thing, reward it. -reinforcement theory -can be biased, you don't see everythinggain sharingteam mentality - if we work together to achieve a certain thing, we are able to get money for the groupprofit sharingprofits for the entire unit or company benefit: if company does well, everyone benefitslong-term incentive plansstock options that vest in a while -good for retention, long-term planDoes Variable Pay Improve Performance Results?-Pay-for-performance plans have a positive effect if they are designed well. -The plans often have too small a payout for the work expected, unattainable (or too easy) goals, not aligned or inaccurate metrics, or too many metrics.what is the biggest ee complaint about performance appraisals?they are too subjectivecriterion-deficientwe didn't measure something we should have (EX. you hit all your metrics, but you were a jerk to your coworkers)criterion contaminationthere's some sort of bias that impacts the scores, thus contaminatingRankings - pros and consPros: forces people to think about who is better, its easier to compare ees b/t branches, corporate likes this Cons: ers don't like this (feels unfair) and hard to judge the people in the middle, ees don't like this (makes them feel more competitive)Rating format: standardslike ranking 1, 2, 3, 4, 5Ranking format: BARS1-5 scale, courts like thisRanking format: MBOset goals with boss, come together to check up and measure (EX. Google)Ranking format: EssayEX. tell me about this ee, talk about 2 times they were exceptional -highest in bias, open-ended -tells ee what they need to do better, and tells them what you like about them/their work