MGT 462 Lecture Notes - Lecture 6: Equity Method, Headcount, Price Fixing
Document Summary
Chapter 8: designing pay levels, mix and pay structures. Labor market - industry, the size of the organization, and the location where you compete to hire employees. Pay structures - grouping of jobs and salary ranges that reflects the hierarchy off jobs and how they are paid. Pay structures were introduced in 1950s to standardize pay pracitces. A combination of job groupings (pay grades) + salary ranges; the greater the job value, the higher the pay grade and pay range. Balance internal value of job with external market data. Ensuring pay is aligned with organization"s values and goals and competitive to the external market. Provides flexibility to differentiate pay according to experience, performance, business impact and market values. Legally defensible reasons to vary pay amongst individuals performing substantially the same work. Provides managers and hr a tool and information to make rational & effective pay decisions that are viewed as fair and competitive by employees.
