MHR 523 Lecture Notes - Job Evaluation, Railways Act 1921, Job Analysis

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Published on 18 Apr 2013
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Compensation Management
Compensation
Cash and non-cash rewards employees receive in exchange for their work
Effective compensation management
o Employees more likely to be satisfied and motivated
When compensation is perceived to be inappropriate
o Performance, motivation and satisfaction may decline dramatically
o Employee turnover may occur
o Dissatisfaction with absolute or relative pay
************Compensation Management
Phase 1
Job Analysis
o Identify and study jobs
- Position descriptions
- Job descriptions
- Job standards
Phase 2
Job Evaluation
o Determine relative worth or value of jobs
o Provides for internal equity
o Job evaluation methods
Job ranking
Job grading
Point system
Phase 3
Salary Surveys
o Discover what other employers are paying for specific key jobs
o Provides for external equity
o Sources of data: e.g.
Labour Canada
HRSDC Offices
Employer Associations
Professional Associations
Self-conducted Surveys
Phase 4
Establishing appropriate pay level for each job
o Combines job evaluation ranking, survey wage rates, and other
considerations e.g. organization’s pay policy
o Wage-trend line developed
Grouping the different pay levels into a structure that can be managed
o Job classes and rate ranges
1) Job analysis- identifies and study jobs, positions and job descriptions, and job standards
2) Job Evolution- determine relative worth of value of jobs, provides for internal equity, Job evaluation
methods(job ranking, job grading, point system)
3)Salary Surveys- discover what other employees are paying for specific job, provide for external equity,
source of data(ex. Labor Canada)
4)Price Jobs- establish appropriate pay level for each job, combines job evaluation. Ranking surveyed,
wage rates and other considerations
MATCH- grouping different pay levels into structure that can be managed, job classes and rate ranges
Pay-for-Performance
Incentive systems provide a clear link between pay and performance or productivity
Incentive pay
o Directly linked to an employee’s performance or productivity
Incentive Systems
Benefits
o Performance is reinforced regularly
o Reinforcement is quick and frequent
o Desired behaviours are likely to continue
o Wages paid in proportion with performance
Disadvantages
o Administration can be complex
o May result in inequities
o Employees may not achieve standards due to uncontrollable forces
o Union resistance
o Focus efforts on one aspect
Individual vs. Team Based Incentives
Individual
o Piecework
o Production bonuses
o Commissions
o Executive incentives
Team
o Team results
o Production incentives
o Profit-sharing
o Stock ownership (ESOP)
o Cost reduction plans
Pay and Organizational Strategy
Areas that Impact Pay Systems
o Motivating Performance
o Identifying Valued Rewards
o Performance Related
o Setting Goals
o Consequences
o Motivating Development
o Attract and Retain
Pay Equity
Canadian Human Rights Act prohibits discrimination because of sex
It is illegal for companies to pay women less than men if their jobs involve equal skills, effort,
responsibilities, and conditions
Government enforces these provisions
Equal pay for equal work
o Employers must pay men and women the same wage or salary when they do the same
work
Equal pay for work of equal value
o Jobs of comparable worth to the organization should be paid equally
o Illegal to discriminate on the basis of job value (or content)
Pay gap
o Historical gap between the pay of men and women
o Canadian women earn about 80 percent as much as men
Pay gap exists in part due to:
o Women tend to work in lower paying occupations
o Career gaps
o Note: 5 - 10% of the pay gap is unexplained
Pay Secrecy
Advantages
o Most employees prefer to have their pay kept secret
o Gives managers greater freedom
o Covers up inequities in the internal pay structure
Disadvantages
o May generate distrust in the pay system
o Employees may perceive that there is no relationship between pay and performance
New Approaches to Pay
Skill- or knowledge-based pay
o Based on the employee’s skills or knowledge
Variable pay
o Performance-linked compensation approach
Total reward model
o Considers everything an employee values
Broadbanding
o Consolidation of pay grades into a few broad bands
Tailor-made perks
International pay
o Need to develop policies to meet global needs

Document Summary

Cash and non-cash rewards employees receive in exchange for their work. Effective compensation management: employees more likely to be satisfied and motivated. When compensation is perceived to be inappropriate: performance, motivation and satisfaction may decline dramatically, employee turnover may occur, dissatisfaction with absolute or relative pay. Job evaluation: determine relative worth or value of jobs, provides for internal equity. Salary surveys: discover what other employers are paying for specific key jobs, provides for external equity, sources of data: e. g. labour canada. Establishing appropriate pay level for each job: combines job evaluation ranking, survey wage rates, and other considerations e. g. organization"s pay policy, wage-trend line developed. Grouping the different pay levels into a structure that can be managed. 3)salary surveys- discover what other employees are paying for specific job, provide for external equity, source of data(ex. 4)price jobs- establish appropriate pay level for each job, combines job evaluation.