Unit 4 Assessment Questions
#2: External competitiveness is the same pay within an organization and their competitors, but comprise of different sources to make up the total pay amount, pay mix. Many companies will offer the same salaries for the same position, but what makes up the total salary is what needs to be looked at. Categories such as benefits, bonuses, options, and base pay make up the pay mix of the salary. One company may not offer a bonus, but the other does, same for benefit packages. One company may offer a better benefit package that starts immediately, while the other offers one similar after 12 months on the job and in good standing with the company. Overall the pay mix standpoint of external competitiveness is what their compensation package is broken down into and what they offer compared to their competitors.
#3: A pay-for-performance plan is pay that is given to someone based of their, or their organizations performance. Incentive plans are an established amount of money promised to an employee based off their performance. Usually done during the hiring process. Individuals and teams can get paid based off the company’s standards of performance. A group performance project will be paid to a group as a whole and divided, where as individual is based on their performance of work during a certain pay period. Sometimes this can be a lump sum amount, short term, or a monthly increment, long term.
#4: The parts that make up total compensation are base pay, bonuses, benefits, and stock options. As far as the percentages go for the pay options and what amount of bonuses, stocks, and pay percentages, those will change depending on the organization. Every organization sets their own percentages for the total of the 100% total compensation packages. Market values for the current location and job type will help determine what the percentages will be for each category. For pay compensation, the percentages are between 64-84% of the total pay package. Bonuses usually go for about 0-6%. Not all companies are required to have a bonus included into their pay mix. Some companies offer yearly bonuses for Christmas or somewhere in the beginning of the calendar year. Benefits is another larger percentage when it comes to the pay mix. About 16-20% of the total pay will be from the benefits. This is a lot of the decision making process for the potential employees. Benefits make up for what they pay is lacking. If the company can provide great benefits, then the pay can be a little lower because the employee will not need to pay for those benefits outside the company.
#5: The three levels of pay policies are leading, matching and following the organizations competitors. The lead pay policy attracts potential employees. The higher the pay, the better the job looks. This also brings an issue though. With the higher pay, organizations can offset the parts of the job that would be less attractive to the potential employees. If they offer the higher pay, then employees can also look past the bad parts of the job. Leading pay also helps retain employees. People stay when they are being treated well. Following pay ensures they the pay levels and total compensation packages are equal or close to the competitors. By leveling the playing field, organizations can focus on other areas of the job to have the potential employees pick them over the others.
Click following link to download this document
BHR 3301 Unit 4 Assessment Questions.docx