COMMERCE 2BC3 Chapter Notes - Chapter 8: Flat Organization, Job Evaluation, Equal Pay For Equal Work
4 Mar 2014
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Document Summary
Human resources chapter 8: pay structure decisions. Job structure - the relative pay of jobs within an organization. Pay level and job structure are characteristics of and reflect organizations, rather than individual employees. Equity theory suggests that people evaluate the fairness of their situations by comparing them with those of other people. A person (p) compares her own ratio of perceived outcomes (o) (pay, benefits, working conditions) to perceived inputs (i) (effort, ability, experience) to the ratio of a comparison other (o). If p"s ratio (op/ip) is smaller than the comparison other"s ratio (oo/io), under0reward inequity results. Two types of employee social comparisons of pay are especially relevant in making pay level and job structure decisions: external equity pay comparisons focus on what employees in other organizations are paid for doing the same general job. A market pay survey is the primary administrative tool organizations use in choosing a pay level.
