Your Sets

Incentive Pay

Forms of pay linked to an employee's performance as an individual, group member, or organization member.

Commissions

Incentive pay calculated as a percentage of sales.

Piecework Rate

Rate of pay per unit produced.

Gainsharing

Group incentive program that measures improvements in productivity and effectiveness objectives and distributes a portion of each gain to employees.

Straight Piecework Plan

Incentive pay in which the employer pays the same rate per piece, no matter how much the worker produces.

Profit Sharing

Incentive pay in which payments are a percentage of the organization's profits and do not become part of the employees' base salary.

Differential Piece Rates

Incentive pay in which the piece rate is higher when a greater amount is produced.

Balanced Scorecard

A combination of performance measures directed toward the company's long- and short-term goals and used as the basis for awarding incentive pay.

Standard Hour Plan

An incentive plan that pays workers extra for work done in less than a preset "standard time."

Merit Pay

A system of linking pay increases to ratings on performance appraisals.

Employee Benefits

Compensation in forms other than cash.

Long-Term Disability Insurance

Insurance that pays a percentage of a disabled employee's salary after an initial period and potentially for the rest of the employee's life.

Social Security

The federal Old Age, Survivors, Disability, and Health Insurance (OASDHI) program, which combines old age (retirement) insurance, survivor's insurance, disability insurance, hospital insurance (Medicare Part A), and medical insurance (Medicare Part B) for older individuals.

Contributory Plan

Retirement plan funded by contributions from the employer and employee.

Unemployment Insurance

A federally mandated program to minimize the hardships of unemployment through payments to unemployed workers, help in finding new jobs, and incentives to stabilize employment.

Noncontributory Plan

Retirement plan funded entirely by contributions from the employer.

Workers' Compensation

State programs that provide benefits to workers who suffer work-related injuries or illnesses, or to their survivors.

Defined-Benefit Plan

Pension plan that guarantees a specified level of retirement income.

Family and Medical Leave Act (FMLA)

Federal law requiring organizations with 50 or more employees to provide up to 12 weeks of unpaid leave after childbirth or adoption; to care for a seriously ill family member or for an employee's own serious illness; or to take care of urgent needs that arise when a spouse, child, or parent in the National Guard or Reserve is called to active duty.

Employee Retirement Income Security Act (ERISA)

Federal law that increased the responsibility of pension plan trustees to protect retirees, established certain rights related to vesting and portability, and created the Pension Benefit Guarantee Corporation.

Patient Protection and Affordable Care Act

Health care reform law passed in 2010 that includes incentives and penalties for employers providing health insurance as a benefit.

Pension Benefit Guarantee Corporation (PBGC)

Federal agency that insures retirement benefits and guarantees retirees a basic benefit if the employer experiences financial difficulties.

Consolidated Omnibus Budget Reconciliation Act (COBRA)

Federal law that requires employers to permit employees or their dependents to extend their health insurance coverage at group rates for up to 36 months following a qualifying event, such as a layoff, reduction in hours, or the employee's death.

Defined-Contribution Plan

Retirement plan in which the employer sets up an individual account for each employee and specifies the size of the investment into that account.

Health Maintenance Organization (HMO)

A health care plan that requires patients to receive their medical care from the HMO's health care professionals, who are often paid a flat salary, and provides all services on a prepaid basis.

Vesting Rights

Guarantee that when employees become participants in a pension plan and work a specified number of years, they will receive a pension at retirement age, regardless of whether they remained with the employer.

Preferred Provider Organization (PPO)

A health care plan that contracts with health care professionals to provide services at a reduced fee and gives patients financial incentives to use network providers.

Summary Plan Description

Report that describes a pension plan's funding, eligibility requirements, risks, and other details.

Flexible Spending Account

Employee-controlled pretax earnings set aside to pay for certain eligible expenses, such as health care expenses, during the same year.

Short-Term Disability Insurance

Insurance that pays a percentage of a disabled employee's salary as benefits to the employee for six months or less.

High-deductible Health Plans (HDHPs)

Health care plans that provide incentives for employees to make decisions that help lower health care costs.

Unions

Organizations formed for the purpose of representing their members' interests in dealing with employers.

Right-to-Work Laws

State laws that make union shops, maintenance of membership, and agency shops illegal.

Labor Relations

Field that emphasizes skills that managers and union leaders can use to minimize costly forms of conflict (such as strikes) and seek win-win solutions to disagreements.

National Labor Relations Board (NLRB)

Federal government agency that enforces the NLRA by conducting and certifying representation elections and investigating unfair labor practices.

Craft Union

Labor union whose members all have a particular skill or occupation.

Collective Bargaining

Negotiation between union representatives and management representatives to arrive at a contract defining conditions of employment for the term of the contract and to administer that contract.

Industrial Union

Labor union whose members are linked by their work in a particular industry.

Strike

A collective decision by union members not to work until certain demands or conditions are met.

Union Steward

An employee elected by union members to represent them in ensuring that the terms of the labor contract are enforced.

Lockout

An employer's exclusion of workers from a workplace until they meet certain conditions.

National Labor Relations Act (NLRA)

Federal law that supports collective bargaining and sets out the rights of employees to form unions.

Mediation

Conflict resolution procedure in which a mediator hears the views of both sides and facilitates the negotiation process but has no formal authority to dictate a resolution.

Arbitration

Conflict resolution procedure in which an arbitrator or arbitration board determines a binding settlement.

Fact Finder

Third party to collective bargaining who reports the reasons for a dispute, the views and arguments of both sides, and possibly a recommended settlement, which the parties may decline.

Parent Country

The country in which an organization's headquarters is located.

Multinational Company

An organization that builds facilities in a number of different countries in an effort to minimize production and distribution costs.

Host Country

A country (other than the parent country) in which an organization operates a facility.

Global Organization

An organization that chooses to locate a facility based on the ability to effectively, efficiently, and flexibly produce a product or service, using cultural differences as an advantage.

Third Country

A country that is neither the parent country nor the host country of an employer.

Transnational HRM System

Type of HRM system that makes decisions from a global perspective, includes managers from many countries, and is based on ideas contributed by people representing a variety of cultures.

Expatriates

Employees assigned to work in another country.

Culture Shock

Disillusionment and discomfort that occur during the process of adjusting to a new culture.

International Organization

An organization that sets up one or a few facilities in one or a few foreign countries.

Cross-Cultural Preparation

Training to prepare employees and their family members for an assignment in a foreign country.

Repatriation

The process of preparing expatriates to return home from a foreign assignment.