Reward Management

These flashcards encompass key vocabulary and concepts related to Reward Management, which is central to Human Resource Management.

Reward Management

A strategic approach to attracting and retaining talent through pay, incentives, and benefits.

Scope of Reward Management

Includes total costs of employee compensation, such as pay, incentives, and benefits.

Pay

The basic wage or salary an employee receives for their work.

Incentives

Additional rewards given to employees for surpassing normal performance expectations.

Benefits

Indirect rewards such as health insurance, pensions, and vacation time.

Objectives of Reward Package

To attract and retain employees, motivate staff, and support organizational goals.

Extrinsic vs. Intrinsic Rewards

Extrinsic rewards are tangible benefits, while intrinsic rewards are personal satisfaction from work.

Internal equity

Fairness of pay compared to others within the same organization.

External equity

Fairness of pay compared to similar roles in other organizations.

Job Evaluation

A process used to determine the relative worth of jobs for pay purposes.

Pay equity

The comparative fairness of pay, both externally and internally.

Performance-Related Pay (PRP)

A compensation system where pay is linked to performance and contributions.

Pay Structures

The framework that outlines how different pay rates are assigned to various jobs.

Cafeteria Approach

A flexible benefits plan that allows employees to choose their compensation elements.

Fringe Benefits

Additional benefits that complement an employee’s salary.

Merit-Based Pay

A compensation system based on employee performance evaluations.

Skill-Based Pay

Compensation that reflects the skills and competencies of employees.

Gain Sharing

A system that distributes a portion of organizational profits among employees.

Employee Stock Ownership Plans (ESOPs)

Programs that give employees an ownership stake in the company.

Compensation Systems

Structures that determine how employees are rewarded financially.

Piecework

A wage system where employees are paid based on their output.

Market Pay

Salaries offered in the job market for similar positions.

Performance Management

A management philosophy focused on improving employee performance.

Job Ranking

A non-analytical job evaluation method that ranks jobs against each other.

Points Rating Method

An analytical job evaluation approach that uses numerical ratings for job factors.

Distributive Equity

The perceived fairness of the distribution of rewards among employees.

Procedural Equity

The fairness of the processes used to determine compensation.

Employee Acceptance

The approval or buy-in of employees regarding a particular pay system.

Competitive Strategy

An organization's plan to attract and retain talent that aligns with their market positioning.

Total Reward

A comprehensive view of all the rewards available to employees including salary, benefits, and non-monetary aspects.

Pay as a Motivator

The concept that employees are motivated by the perceived value of their pay and potential rewards.