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March 26 2013.docx

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Laura Allan

March 26 2013 Determining Compensation -attractive labour wage to attract people to apply -you compete with companies within that industry -see what the competitors pay their employees -retain for example some employee benefits as well as insurance for them to stay -motivate (in order for them to work efficiently) External, internal equity and incentives (paying employees based on their performance) Internal equity – job evaluation -Job and analysis - understanding the job vs Job evaluation – taking the job and assign its pay Step one develop rating system on job Step two once you develop the system you need to use the info to rate jobs Step three assign pay on relative value (have two diff job with same rating = same pay) Point method -most expensive method -need to make employees feel that the rating is fair for them to stay at the company How it works 1. Start with universal factors applicable to everyone (skill, effort, responsibility and job conditions) 2. Divide into sub factors (for example what factors of skills matter to you) 3. Rating the criteria such as including a scale (degrees) 4. Assign each degree with a point value ( what is it worth for the company) 5. Assign pay grade (ranges of points) = to assign pay Pricing the Pay structure -to structure the pay rates vs pay grades therefore showing the points on the graph Pricingthe PayStructure... Trend Line * * Rates * * * * * * Range ** * * * * * * Pay Grades / Job Evaluation Points Red circle points are people who are not comfortable with the pay they are given For example if they have a higher pay then more responsibilities would be given, and if they have a lot of responsibilities and their wage is not paid well enough we could use the pricing structure to increase their wage rate Pay Equity Legislation - Equal pay for equal work (legislation put in when women were paid lower then men previously) - Also prohibits di
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