Human Resource Management

Compensation does not include non-cash rewards employees receive in exchange for their work.

Compensation programs help to maintain an organization's human resources.

Employee dissatisfaction can arise because needs are affected by both relative and absolute levels of pay.

When relative pay is too low,employees cannot meet their physiological and security needs.

In Canada,absolute pay tends to cause more dissatisfaction than relative pay.

Among the objectives of effective compensation administration are included the desire to control costs,reward behaviours,and ensure equity.

If a recruiter offers a higher than normal (for the organization)salary to a qualified recruit in a labour-competitive market,this can cause a conflict with internal equity policies.

Internal equity in compensation requires that pay be directly related to the rate perceived as fair in the local marketplace.

In compensation management,internal equity is also referred to as internal consistency.

Job evaluations are systematic procedures to determine the relative worth or value of jobs.

The purpose of job evaluation is to identify which jobs should be paid more than others.

Job evaluation methods include job ranking,job grading,and the point system.

Pay equity legislation has dramatically increased the use of the job ranking and job grading methods as the most effective means of evaluating jobs.

There are six steps required to implement the point system of job evaluation.

The first step in the point system of job evaluation is to determine compensable factors.

In the point system of job evaluation,listing job factors down one side and point levels across the top results in a point system matrix.

The point system for job evaluation cannot be applied until the point matrix and the point manual are ready.

All job evaluation techniques result in a ranking of jobs that assures internal equity.

External equity is fairness of pay relative to what other employers are publishing as their pay ranges.

Wage and salary surveys are studies of what other organization are paying within the employer's labour market.