Terminology HR

Terminology HR Developing

compensation plans

Pay for performance and

employee benefit s-scientific management .Sick leave .Stock option .Straight piecework .Supplemental pay

benefits.Supplemental

unemployment benefits .Team or group incentive

plan

Financial incentives .Productivity .Variable pay .Standard hour plan .Straight piecework . merit pay .Annual bonus .Stock option .Profit sharing plan .

Scientific management A management

approach based on improving work methods through observation and analysis .

- Taylorism . E.-1810s book .Advantage .Disadvantage .

Sick leave Provides pay to an

employee when off work because of illness .

-Example .

Stock option The right to purchase

a stated number of shares of a company stock at today’s price at some time in the future.

- 90Benefits .Example

Straight piecework An incentive plan in

which a person is paid a sum for each item he or she makes or sells, with a strict proportionality between results and rewards.

Supplemental pay benefitsBenefits for time not

worked, such as unemployment insurance, vacation and holiday pay, and sick pay .

- Example .

Supplemental unemployment benefits

Provide for a ‘guaranteed

annual income’ in certain industries where employers must shut down to change machinery or due to reduced work. These benefits are paid by the company and supplement employment benefits.

Example .

Team incentive plan A plan in which a

production standard is set for a specific work group, and its members are paid incentives if the group exceeds the production standard.

-

Financial incentives Financial rewards paid

to workers whose production exceeds some predetermined standard.

- Bonuses .-stock option .-profit sharing .

Productivity The ration of outputs

(goods and services) divided by the inputs (resources such as labor and capital).

Variable PayAny plan that ties pay

to productivity or profitability, usually as one-time lump payments.

Standard hour plan A plan by which a worker

is paid a basic hourly rate, but is paid an extra percentage of his or her base rate for production exceeding the standard per hour or per day. Similar to piecework payment but based on a percent premium.

Merit pay (merit raise)Any salary increase

awarded to an employee based on his or her individual performance.

Annual BonusPlans that are

designed to motivate short-term performance of managers and which are tied to company profitability.

Profit-Sharing PlanA plan whereby

employees share in the company's profits.