Which of the following is a prerequisite for the effective execution of a merit-pay plan in an organization?
A) The employees participating in a merit-pay program must mandatorily possess a stock-option plan.
B) The organization must have valid and reliable measures of what merit entails.
C) The performance measurement system must not differentiate too greatly among employees.
D) The criteria for reward should be the knowledge level of employees.
E) The evaluation of individual merit should be performed based on an employee's behavior and conduct.

Question

Quizplus · Accepted Answer

For a merit-pay plan to be effective, the organization must have valid and reliable measures of what merit entails. This ensures that rewards are being given to employees based on their actual merit and not just subjective criteria. The other options (A, C, D, and E) are not prerequisites for the effective execution of a merit-pay plan.

Which of the Following Is a Prerequisite for the Effective