Compensation and Its Impact on Behavior in Organizations

A comprehensive set of flashcards covering key vocabulary and concepts related to compensation and its impact on organizational behavior.

Compensation

All forms of financial returns and tangible services and benefits employees receive as part of an employment relationship.

Incentive Plans

Plans that reward employees for developing innovative solutions or products.

Relational Returns

Non-financial returns from work that include recognition, employment security, and opportunities to learn.

Equity

A fundamental objective of pay systems that refers to fairness in compensation.

External Competitiveness

Refers to how pay compares with competitors to attract and retain employees.

Internal Alignment

Comparisons among jobs or skill levels within a single organization.

Merit Increases

Incremental pay increases based on employee performance.

Cost of Living Adjustment (COLA)

A adjustment to base wages based on changes in living costs.

Stock Options

An executive pay component that allows purchase of company shares at a fixed price.

Employee Behavior

Actions and attitudes of employees influenced by compensation.

Motivational Intensity

The level of motivation an employee exhibits toward their work.

Diminishing Returns

The principle that after a certain point, increases in pay provide lesser additional happiness.

Financial Incentives

Pay increases tied directly to employee performance.

Total Compensation

The overall pay and benefits an employee receives.

Work/Life Balance Benefits

Programs that assist employees in managing their work and personal responsibilities.

Executive Compensation

Pay structures for top management that often include bonuses and stock options.

Variable Pay

Compensation that varies based on performance, often used as incentives.

Pay Model

A framework for examining and designing compensation systems.

Compliance

Adherence to federal and state compensation laws.

Pay Techniques

Methods used to structure compensation decisions.

Caveat Emptor

Latin for 'let the buyer beware', a principle to evaluate compensation research.

Income Protection Benefits

Benefits like unemployment or disability insurance that protect employees financially.

Motivational Purity Bias

Evaluation bias against candidates motivated solely by financial rewards.

Labor Costs

The total of the compensation, benefits, and related costs tied to employees.

Pay Policy Choices

Strategies defining how compensation is structured both internally and externally.

Shareholder Proposals

Recommendations made by stockholders that influence executive pay decisions.

Performance Ratings

Evaluations that determine merit increases or bonuses.

Employee Contributions

Efforts or results that employees bring to the workplace, impacting pay decisions.

Challenging Work

Tasks that are difficult but encourage professional growth, included in relational returns.

Flexibility in Work Arrangements

Policies that allow employees to tailor their work schedules to meet personal needs.

Human Capital

The skills, knowledge, and experience possessed by individuals which is valuable to employers.

Proxy Votes

Votes cast by shareholders to influence decisions at corporate meetings.

Satisfaction from Facing Challenges

A relational return that contributes to job satisfaction and performance.

Job Evaluation

Assessment of job roles to determine their relative worth for compensation.

Innovative Solutions

Creative strategies and ideas that improve business performance.

Productivity

A measure of output per unit of input; higher pay may correlate with higher productivity.

Employee Engagement

The emotional commitment an employee has to their organization and its goals.

Development Opportunities

Programs designed to enhance employee skills and career advancement.

Safety and Security Support

Benefits ensuring protection against workplace hazards or income loss.

Legal Framework Governing Pay

Laws that regulate wage practices including minimum wage and overtime.

Job Market Dynamics

Factors influencing employment opportunities and labor costs in a given environment.

Causation vs Correlation

A crucial distinction in research, determining whether one factor affects another.

Undue Influence

Improper pressure or use of privilege affecting compensation decisions.

Employee Turnover

The rate at which employees leave a workforce and need replacement.

Customer Perceptions

Opinions or beliefs held by customers regarding a company's treatment of employees.

FLSA

Fair Labor Standards Act, defining labor law standards including minimum wage.

Paid Time Off (PTO)

Employee benefits that provide paid absence from work for various purposes.

Health Insurance Benefits

Coverage provided by employers to support employee medical costs.

Executive Pay Packages

Comprehensive compensation structures for senior management, often including bonuses.

Stock Grants

Forms of compensation that give employees shares in company stock.

Professional Development

Continued education and training aimed at improving employee skills.

Job Description

A written statement describing the duties and responsibilities of a job.

Team-Based Pay

Compensation strategies that reward teams rather than individuals.

Efficiency in Compensation

Ensuring pay practices maximize productivity and minimize unnecessary costs.

Employee Union Dynamics

The interactions and negotiations between labor unions and employers.

Organizational Culture

The values and practices of an organization that shape its work environment.

Workforce Composition

The demographic and skill diversity of employees within an organization.

Incentive Compatibility

Alignment of employee incentives with organizational goals.

Wage Compression

A situation where there is only a small difference in pay between employees.

Equitable Pay Practices

Fair approaches to determining compensation based on job responsibilities.

Performance Management Systems

Processes designed to evaluate employee performance regularly.

Job Attractiveness

Features that make a job appealing to potential candidates.

Collective Bargaining Agreements

Contracts negotiated between unions and employers regarding pay and working conditions.

Cultural Differences in Compensation

Variations in how different cultures perceive and structure pay.

Hiring Practices

Methods and policies governing recruitment and selection of employees.

Recruitment Costs

Expenses incurred in attracting and hiring new employees.

Compensation Model Variability

Differences in compensation strategies between various industries or companies.