Exam 5: Performance Pay Choices

The central issue associated with attendance incentives is the notion that these programs treat only the symptoms while ignoring the underlying issues that cause absenteeism in the first place.

Which of the following management strategies is likely to benefit the most from using a gain-sharing plan as part of their compensation strategy?

As the owner of a real estate firm with multi-office operations, you provide a bonus to all sales personnel in the highest-producing office each month. What type of performance pay plan are you using?

In what way are piece rates and commissions similar to each other?

Unions generally oppose profit-sharing plans on the basis of potential manipulation of profits by management and the uncertainty associated with profit sharing when compared with base pay.

Your CEO is concerned that employees are not saving enough for their retirement. At the same, the CEO wants to have some of the company's profits shared with all employees. To address these issues, your CEO asks you, a human resource compensation specialist, to recommend the most appropriate profit-sharing plan to address this retirement issue. Which of the following profit-sharing plans would you recommend?

Which of the following pay plans targets organizational-level performance?

Which of the following is NOT a suitable condition for merit pay?

According to the textbook, what is the main drawback associated with attendance plans?

Which plans are set up so that a payout is contingent on the achievement of three- to five-year performance goals?

Which of the following characteristics of profit-sharing plans may be viewed as negative from the perspective of an employer?

There is strong congruency between classical management philosophies and piece rate pay schemes, particularly in industrial settings. What characteristic of this management philosophy do you believe hinders the expansion of piece rate schemes in such organizations?

Which of the following would NOT be an ideal scenario in which to consider using a piece rate plan?

As a human resources specialist, your job is to review the pattern of merit raises issued by managers last year. You found that the vast majority of managers did not differentiate between high and low performers, choosing to provide similar merit raises. What would you speculate is the driving force behind the managers' actions?

Which of the following best explains why, despite their motivational potential, piece rate systems often do not motivate maximum effort?

Identify and briefly define each of the three types of employee stock plans.

As a human resource specialist, you have been asked by your organization to lead a discussion on the merits of using internal promotions as a main reward mechanism. Which of the following point(s) would you most likely NOT raise?

Sales commissions are usually appropriate in situations where individual sales people exercise significant independence.

When should the proportion of base pay relative to commission be higher?

Which of the following is normally seen as an advantage associated with long-term incentives plans?