MHR 749 Midterm: Midterm Review
4 Nov 2017
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Document Summary
What is compensation: compensation refers to all forms of financial returns and tangible services and benefits employees receive as part of an employment relationship. The link between behaviour and organizational effectiveness is important to consider. If employees also perceive compensation is not fair, then there is great potential for changes in their behaviour to undermine organizational performance. Compensation is a significant component of operating expenses and therefore must be controlled and monitored to ensure organizational viability. Total rewards are all rewards received by employees, including: cash compensation, benefits, and, relational returns. Cash that an employer pays in return for the work performed. A function of the skill or education an employee possesses. Merit increases* are given as an increment to the base pay in recognition of past work behaviour. Merit increases are increments to base pay based on performance. Merit bonuses are paid in a lump sum rather than becoming a part of base pay.
