Exam 13: Recognizing Employee Contributions With Pay

Maria,an employee of a finance company,believes that purchasing the company's stock will always be profitable regardless of the stock's market value.She feels that stock options are long-term incentive plans that make employees part owners of the organization.Which of the following statements contradicts Maria's belief?

Which of the following would be a reason for organizations to implement profit sharing?

Vactin Motors,an automobile company,ties individual performance,profits,and other measures of employees' success to a particular form of pay.This form of pay is influential because the amount paid is linked to certain predefined behaviors or outcomes.Which of the following is exemplified in this scenario?

Electrix Inc.is an electrical appliances manufacturing company.It distributes shares of stock to its employees by placing the stock in a trust managed on the employees' behalf.Which of the following has been implemented by Electrix in this scenario?

The link between employees' performance and pay is harder to establish in:

In a company's merit pay program,individuals' compa-ratio represents their:

What is the drawback of stock ownership as a form of incentive pay?

The Scanlon plan of gainsharing gives employees a bonus if the ratio of labor costs to the sales value of production is below a set standard.

What are the implications of designing pay for organizational performance?

An employee at CellWorks who produces 10 components in an hour earns $9 ($.90 × 10)per hour,while another employee who produces 15 components earns $13.50 ($.90 × 15).This is an example of a:

What are the advantages and disadvantages of a merit pay system?

Which of the following is an advantage of the merit pay incentive system?

Linking incentives to the organization's profits or stock price exposes employees to a high degree of risk.

The balanced scorecard helps employees understand the organization's goals and how they can contribute to these goals.

Organizations that want employees to focus on efficiency and on group incentives are most likely to implement a _____ program.

Jennifer believes that the challenge of identifying appropriate performance measures for complex jobs can be resolved by implementing a gainsharing plan.Natalie argues that it is a poor incentive program in an organization that wants to encourage teamwork.Which of the following statements weakens Natalie's argument?

Under incentive pay,piecework rates are most suited for routine,standardized jobs with output that is easy to measure.

Token Inc.is an envelope manufacturer based in Dallas.The employees of the organization receive incentive pay based on the amount of work produced.If the output of an employee is more than the average production volume,then the organization pays an incentive in addition to wages and salaries.In this case,which of the following incentives is offered by Token Inc.?

What is balanced scorecard? What is its purpose? What are the advantages of using a balanced scorecard?

How does allowing employees to participate in pay-related decisions affect the incentive process?