Base Wage and Salary Systems.ppt

,basewageandsalarysystems,chapter13,learningobjectives,definebasewagesandsalariesandstatetheobjectiveofanybasewageandsalarysystem.definejobevaluation.nameandbrieflydiscussthefourbasicconventionalmethodsofjobevaluation.explaintheconceptsofkeyjobsandcompensablefactors.differentiatebetweensubfactorsanddegrees.,13-2,learningobjectives(cont.),explainthepurposeofwageandsalarysurveys.discusswageandsalarycurves.definepaygradesandpayranges.explaintheconceptsofbroadbanding,skill-basedpay,competency-basedpay,market-basedpay,andtotalrewards.,13-3,basewageandsalaries,basewagesandsalarieshourly,weekly,andmonthlypaythatemployeesreceivefortheirwork.makeupthelargestportionofanemployeestotalcompensation,13-4,specificpolicyissuesindevelopingandimplementingabasewageandsalarystructure,13-5,figure13.1,objectiveofthebasewageandsalarysystem,primaryobjectivetoestablishastructureforequitablecompensationofemployees,dependingontheirjobsandlevelofperformanceintheirjobs,13-6,objectiveofthebasewageandsalarysystem,establishingpayrangesinvolvestwobasicphases:determiningrelativeworthofdifferentjobstotheorganization(ensuringinternalequity)pricingthedifferentjobs(ensuringexternalequity),13-7,conventionaljobevaluation,jobevaluationsystematicdeterminationofvalueofeachjobinrelationtootherjobsintheorganizationusedfordesigningapaystructure,13-8,conventionaljobevaluation,gatherinformationonthejobsbeingevaluatedidentifyfactororfactorstobeusedindeterminingworthofdifferentjobstotheorganizationdevelopandimplementaplanusingchosenfactorsforevaluatingrelativeworthofdifferentjobstotheorganization,13-9,jobevaluationmethods,13-10,potentialusesofjobevaluations,13-11,figure13.2,jobrankingmethod,jobrankingmethodjobevaluationmethodthatranksjobsinorderoftheirdifficultyfromsimplesttomostcomplex.,13-12,jobclassificationmethod,jobclassificationmethodmethodthatdeterminestherelativeworthofajobbycomparingittoapredeterminedscaleofclassesorgradesofjobsalsocalledjobgradingdefinedonbasisofdifferencesinduties,responsibilities,skills,workingconditions,13-13,pointmethod,pointmethodmethodinwhichaquantitativepointscaleisusedtoevaluatejobsonafactor-by-factorbasis.simpletouseandreasonablyobjective.,13-14,selectionofkeyjobs,keyjobs(benchmark)representjobsthatarecommonthroughouttheindustryoringenerallocaleunderstudycontentofkeyjobsshouldbecommonlyunderstoodgeneralideaistoselectalimitednumberofkeyjobsthatarerepresentativeofentirepaystructureandthemajorkindsofworkbeingevaluated,13-15,selectionofkeyjobs,selectionofkeyjobsshouldadequatelyrepresentspanofresponsibilitiesdutiesworkrequirements,13-16,selectingcompensablefactors,compensablefactorscharacteristicsofjobsthattheorganizationdeemsimportanttotheextentthatitiswillingtopayforthem.,13-17,selectingcompensablefactors,jobsubfactordetailedbreakdownofasinglecompensablefactorofajob.,degreestatementswrittenstatementsusedasapartofthepointmethodofjobevaluationtofurtherbreakdownjobsubfactors.,13-18,possiblesubfactorsanddegreesforthecompensablefactorsofresponsibility,withsamplejobs,13-19,table13.1,assigningweightstofactors,weightsareassignedtoeachofthefactors,subfactors,anddegreestoreflecttheirrelativeimportanceweightassignedvariesfromjobtojob,13-20,assigningweightstofactors,weightsareassignedonbasisofmaximumnumberofpointsforanyjobpointsarethenassignedtocompensablefactors,subfactors,anddegreesbasedontheirrelativeimportance,13-21,samplepointvalues,13-22,table13.2,assigningpointstospecificjobs,afterpointscalehasbeenagreedon,pointvaluesarederivedforkeyjobsusingthefollowingsteps:examinethejobdescriptionsdeterminedegreestatementthatbestdescribeseachsubfactorforeachcompensablefactoraddtotalnumberofpoints,13-23,possiblepointtotalsforkeybankingjobs,13-24,table13.3,factorcomparisonmethod,factorcomparisonmethodjobevaluationtechniquethatusesamonetaryscaleforevaluatingjobsonafactor-by-factorbasis.,13-25,factorcomparisonmethod,eachcompensablefactorisrankedaccordingtoitsimportanceineachkeyjobdonebyassigningaranktoeverykeyjobononefactoratatimeratherthanrankingonejobatatimeonallfactorsaftereachkeyjobhasbeenrankedonafactor-by-factorbasisallocatewageorsalaryforeachjobaccordingtorankingoffactorsmonetaryscaleispreparedforeachcompensablefactor,13-26,factor-by-factorrankingofkeybankingjobs,table13.4,13-27,sampleallocationpayforkeybankingjobs,13-28,table13.5,monetaryscaleforresponsibilityrequirementsinbankingjobs,13-29,table13.6,advantagesanddisadvantagesofdifferentjobevaluationmethods,13-30,table13.7,pricingthejob,13-31,wageandsalarysurveys,wageandsalarysurveysurveyofselectedorganizationswithinageographicalareaorindustrydesignedtoprovideacomparisonofreliableinformationonpolicies,practices,andmethodsofpayment.,13-32,wageandsalarysurveys,advantagesprovidesknowledgeofmarketandensureexternalequitycorrectsemployeemisconceptionsaboutcertainjobshasapositiveimpactonemployeemotivation,13-33,wageandsalarysurveys,wageorsalarysurveyinformationcanbeobtainedintwobasicways:conductingyourownsurveypurchasingoraccessingawage/salarysurveyundertakenbyanotherparty,13-34,conductingawage/salarysurvey,13-35,conductingawage/salarysurvey,personalinterviewmostreliableandmostexpensivemethodmailedquestionnairesprobablyusedmostfrequentlyusedonlytosurveyjobshavinguniformmeaningalloverindustrycanbeansweredbysomeonenotfullyfamiliarwithwagestructure,13-36,conductingawage/salarysurvey,telephonemethodquickbutyieldsincompleteinformationmaybeusedtoclarifyresponsestomailedquestionnairesinternetinexpensiveandquickallcompaniesarenotreachableoninternet,13-37,possibletopicsinawagesurvey,13-38,figure13.3,purchasingoraccessingwage/salarysurveys,potentialsourcesforrelativelyinexpensivewage/salarysurveysincludethebureauoflaborstatisticsofu.s.departmentoflaborstateandlocalgovernmentstradeassociationschambersofcommerceinternet,13-39,purchasingoraccessingwage/salarysurveys,surveysavailableontheinternetfallintotwobroadcategories:surveysconductedbyfederalgovernmentsurveysconductedbyprivateresearchorganizations,professionalassociations,employeesassociations,andconsultingfirms,13-40,sampleofwebsitesforwage/salarysurveydata,13-41,figure13.4,guidelinestoavoidproblemsduringwageandsalarysurveys,assesstheparticipatingcompaniesforcomparabilitycomparemorethanbasewageorsalaryconsidervariationsinjobdescriptionscorrelatesurveydatawithadjustmentperiods,13-42,problemsencounteredwhenusingsalarysurveydata,13-43,figure13.5,wageandsalarycurves,wageandsalarycurvesgraphicaldepictionoftherelationshipbetweentherelativeworthofjobsandtheirwageratescanbeusedtoindicatepayclassesandrangesforthejobs,13-44,wagecurveusingthepointmethod,13-45,figure13.6,wageandsalarycurves,pointsofgraphnotfollowinggeneraltrendindicatewagerateforthatjobistoolowortoohighthejobhasbeeninaccuratelyevaluated,green-circlejobsunderpaidjobsred-circlejobswagesareoverlyhigh,13-46,paygradesandranges,paygradesclassesorgradesofjobsthatforpaypurposesaregroupedonthebasisoftheirworthtoanorganization.,payrangerangeofpermissiblepay,withaminimumandamaximum,thatisassignedtoagivenpaygrade.,13-47,paygradesandranges,twoapproachesforestablishingpaygradesandrangestohavearelativelylargenumberofgradeswithidenticalratesofpayforalljobswithineachgradetohaveasmallnumberofgradeswitharelativelywidedollarrangeforeachgrade,13-48,establishmentofpaygradeswithranges,13-49,figure13.7,developingthebasewagesalarystructure,13-50,figure13.8,newapproachestothebasewage/salarystructure,13-51,broadbanding,broadbandingcollapsingjobclustersortiersofpositionsintoafewwidebandstomanagecareergrowthanddeliverpaybandsusuallyhaveminimumandmaximumdollaramountsthatoverlap,13-52,broadbanding,advantagesmanagershavemoreautonomyinsettingpayrateseasiertomoveemployeesaroundencourageslateralmovesordowngradinginflatorganizationshelpsimprovecommunicationteamwork,13-53,skill-basedpay,skill-basedpaysystemssystemsthatcomp