Rewards
Rewards. OS352 HRM Fisher Nov. 9, 2004. Agenda. Pay grades Purpose and types of rewards Effectiveness Case study. Pay Grades. Used in federal government Job evaluation places jobs in a specific pay grade Can have ranges (e.g., GS 11-13, depending on education and experience)
Rewards
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Rewards OS352 HRM Fisher Nov. 9, 2004
Agenda • Pay grades • Purpose and types of rewards • Effectiveness • Case study
Pay Grades • Used in federal government • Job evaluation places jobs in a specific pay grade • Can have ranges (e.g., GS 11-13, depending on education and experience) • Also have pay differentials
GradeSalary 1 $22,000 2 $35,000 3 $36,000 4 $45,000 5 $68,000 How does all of this become a pay structure? Helps guide/place controls on managers – we know when an employee is paid appropriately
Purpose of rewards • Thank employees for a job well done • Motivate certain kinds of behaviors • Continued good performance • Increased performance • Change in how effort is allocated • Need to consider motivation theories when determining appropriate rewards • Equity • Expectancy • Need based theories
Pay Increases • Raise – permanent increase • Bonus – one time payment • Spot bonuses are less formal bonus programs • Many companies still using signing bonuses • Increases must be large enough to be meaningful • Thinking about raises vs. bonuses • What are the cost implications of each? • What are the motivational implications of each?
Basis for rewards • Individual level rewards • Piecework • Merit pay • Sales commissions • Group/organizational level rewards • Gainsharing • Profit sharing • Stock ownership
Non-monetary rewards • Includes recognition and opportunities • Employee of the month • Lunch with the boss • Bigger office • Attending a conference or seminar • Not technically part of the overall compensation package, but an important motivational tool
Effectiveness • Aligned with corporate goals, strategy • Contingent on performance • Valued by the employees • Allocation process is perceived as fair
Rewards Case Study • Read the “Howe 2 Ski” case study • Will be distributed in class • In small groups, answer the questions • Whole class discussion
An Ongoing Debate: Do Monetary Rewards Motivate or De-Motivate? • Motivate: Economic incentives improve quantity and do not reduce quality (Gupta & Mitra). • De-Motivate: Economic incentives reduce the satisfaction of doing enjoyable tasks (Deci).
For next class • Topic: Pay secrecy • Read HBR case “When Salaries Aren’t Secret” • What are the key issues for the organization? For the employees? • How would you recommend the organization deal with this problem? • If you did not buy the case, it is available in hard copy from the library
