PSYC 3070 Chapter Notes - Chapter pg 481-504: Market Basket, Equity Theory, Expectancy Theory
10 Jan 2016
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Employees desire compensation systems that they perceive as being fair and commensurate with their skills and expectations. Compensation (i. e. raises) is a good way to increase employee loyalty. It is important to pay attention to this and not just try to hire more loyal employees as compensation is directly link to an employee"s livelihood. Compensation consists of three main components: and commissions. Direct compensation: encompasses employee wages and salaries, incentives, bonuses, Indirect compensation: comprises the many bene ts supplied by employers. Non- nancial compensation: includes employee recognition programs, rewarding jobs, organizational support, work environment, and exible work hour to accommodate personal needs. Strategic compensation: the compensation of employees in ways that enhance motivation and growth while at the same time aligning their efforts with objectives, philosophies and culture of the organization compensation to the organization"s mission and general business objective. Goes beyond determining what market rates to pay employees to purposefully link.
