BUS 357 - Ch. #6 - Formulating the Rewards+Compensation Strategy

What some types of constraints? (4)

1. Legislated Constraints

2. Labour market

3. Product / Service Market

4. Financial

What are some types of legislated constraints? (4)

1. Employment standards

2. Human rights legislation

3. Trade union legislation

4. Tax legislation

What are employment standards?

Sets minimum standards for pay and other conditions of employment

What human rights legislations?

Legislations that prohibit discrimination in hiring or employing on the basis of gender, ethinicity, or age 

What is trade union legislation?

Legislations that define the rights of parties involved in a collective bargaining relationship

What is tax legislation?

Legislations that are related to income and corporate tax laws

What type of legislated constraint has played a significant role in movement away from direct pay?

Tax legislation has impacted the movement away from direct pay (which is fully taxed) and toward indirect pay (which often isn’t fully taxed)

What are the steps (in order) for creating a compensation strategy? (BRMLE)

1. Define the required behaviour (B)

2. Define the role of compensation (R)

3. Determine the compensation mix (M)

4. Determine the compensation level (L)

5. Evaluate the proposed strategy (E)

Which of the following legislative constraints applies to the issue of minimum wage?

Employment standards legislation

What is membership behaviour?

What is task behaviour?

What are factors to consider when defining the required behaviour when formulating the compensation strategy?

• Membership behaviour 

• Task behaviour 

• Citizenship behaviour

What are membershsip behaviour questions to consider when defining the required behaviour when formulating the compensation strategy?

• What are the costs of turnover?

• Is affective commitment necessary, or is continuance commitment sufficient?

What are task behaviour questions to consider when defining the required behaviour when formulating the compensation strategy?

• Are tasks simple or complex?

• Do employees work under supervision?

• Are high performance levels required?

What are citizenship behaviour questions to consider when defining the required behaviour when formulating the compensation strategy?

• How important is cooperation for each company unit and the individuals in it?

• To what extend can extra employee initiative or ideas make a difference to organizational performance?