Exam 8: Building Pay Structures that Recognize Individual Contributions

This type of commission draw acts as a salary because employees are not obligated to repay the loans if they do not sell enough to cover the amount.

Which scenario would be appropriate for using a salary-only plan?

In establishing pay grades,which pay rate is established first?

A recently opened car dealer uses an incentive compensation plan for its sales people.The dealer provides money to its salespeople to cover basic living expenses and then shares a fixed percentage of the selling price of each car that a salesperson sells.However,the salesperson should repay the subsistence pay component within a year; otherwise he/she cannot continue in the employment of this dealer.What type of sales compensation plan does this dealer adopt?

Briefly discuss designing job-based pay system (i.e.merit pay,sales incentive pay)and person-focused programs.What considerations arise when making a transition from using a job-based pay system to using pay-for-knowledge?

This is a loan from the company to the employee that is carried forward indefinitely until the employee sells enough to repay it.

________ represent the vertical dimension of pay structures.

A ________ is the difference between the maximum and minimum pay rates of a given pay grade.

This theory suggests that an employee must regard his own ratio of merit increase pay to performance as similar to the ratio for other comparably performing people in the company.

This federal Act requires contractors with federal contracts worth over $2,000 to pay wages at least equal to those prevailing in the area where the work is being done.

With which sales compensation plan does the level of pay not vary when sales volume does?

Money that covers the basic living expenses of sales professionals is better known as a ________,

________ assign different pay rates for jobs of unequal worth,and provide the basic framework for recognizing differences in individual's contributions.

How are compa-ratios calculated?

________ is a form of compensation based upon a percentage of the selling price of a product or service.

Richard's job has a compa-ratio of 0.85.What does this ratio tell about Richard's pay rate?

Alejandro Martinez is responsible for setting up the pay structure for his company.He believes that newly hired employees should not be paid as much as established employees.Accordingly,what type of pay structure should Mr.Martinez use?

Which of the following would NOT be considered as an advantage of broadbanding?

The ________ pay value is the halfway mark between the range minimum and maximum rates.

If the company adopts a market lag policy,how will that company's pay range midpoint compare to the market average?