159. Due to the secret nature of performance standards, employees are only permitted to
review these standards at the time when they receive their appraisal.
160. Early in the year, manager John Jacobs set reasonable, understandable, and measurable
performance standards and communicated these standards clearly to all team members.
Because of these efforts, he should be prepared for the next step in the appraisal process.
161. When she met with John to discuss his performance appraisal, Regina noted that John
had difficulty with managing his time on certain projects. One drawback of a performance
appraisal is that it does not allow for feedback during the evaluation process.
162. Mollie Herndon is an office manager at Beaux Neaux Legal Services. The company’s top
management recently announced it was adopting a 360-degree review process as part of the
performance appraisals of its office managers. Once this policy goes into effect, Mollie can
expect her evaluations to include feedback from both the managers above her and the employees
she supervises.
163. When Andrew administered the performance appraisals for his employees at California
Canines, a producer of upscale clothing and accessories for pets, he made certain that he
allowed at least one hour for each. He met with each employee in his quiet office, and gave each
an opportunity to prepare a self-improvement program. His goal was to make each process a
positive experience for the employee. Andrew carried out the suggestions of experts in
performing effective performance appraisals.
164. The marketing manager at Cool Rags, Inc., was very critical of the way one of the
distribution analysts was handling negotiations with a manufacturer in Malaysia. On a number of
occasions, she thought the discussions could have resulted in more of a win-win situation. In
order to follow correct procedures, the manager made notes on these issues and decided to wait
until the performance appraisal, eight months down the road, to discuss the situation with the
analysts. If Cool Rags has a formal performance appraisal process in place, this is the best
approach to this situation.
165. Companies compete with other firms for good employees.
166. Compensation is one of the main marketing tools a firm uses in its efforts to attract
qualified employees.
167. Airlines, banks, hospitals and many other service organizations are so labor intensive that
the cost of labor is their primary cost of operations.
168. The long-term success of a firm often depends on its ability to control employee costs and
optimize employee efficiency.
169. One objective of a carefully managed compensation and benefit program is to retain
valued employees.
170. The Hay compensation system gives managers the flexibility to adjust pay for workers to
reflect the value of their contribution to the firm.
171. Blue collar and clerical workers are normally paid a salary.
172. In an ongoing study, Jay Schuster concluded that the best way to compensate members of
a team is to base each member’s pay on her or his individual performance.
173. Skill-based pay is a method of compensating teams in which base pay is raised when
team members learn and apply new skills.
174. An advantage of a skill-based system of pay for compensating teams is that such a system
is easy to apply and administer.
175. Expenditures on fringe benefits have declined as a percentage of total payroll costs over
the past several decades.
176. Fringe benefit payments account for about 30 percent of payroll costs today.
177. Employees sometimes prefer increases in fringe benefits rather than increases in wages
or salaries, because many fringe benefits are not subject to taxes.
178. On-site haircuts and free breakfasts are examples of soft benefits some firms provide for
employees.
179. A fringe benefits plan that allows employees to choose the benefits they want up to a
certain dollar amount is known as a
soft benefit
plan.
180. Many firms are now contracting with outside companies to administer their employee
benefits plans.
181. According to the
Reaching Beyond Our Borders
box, human resource managers will be
able to count on the superiority of American business practices as they help manage a global
workforce.
182. One objective of a carefully managed compensation plan is to keep labor costs low. In
order to achieve this objective, a firm should strive to keep wages, salaries and benefits at or
below the compensation levels of its competitors.
183. According to the
Reaching Beyond Our Borders
box, companies must consider a number
of compensation-related issues for employees who work abroad. These may include currency
conversion issues, special concessions such as travel and housing allowances, differences in
health care standards in different countries, and even vacation benefits.
184. Recent trends suggest that the best way for firms to control labor costs is to focus on
limiting the growth of wages and salaries rather than controlling fringe benefits.
185. The reason that companies use the gain-sharing pay system and the skill-based pay
system to compensate teams of employees is that both are closely tied to profit performance.
186. Highly compensated executives sometimes prefer fringe benefits such as club
memberships, company cars, and more vacation time, as opposed to higher salaries because
most often these benefits are not taxable income.
187. Some firms have found that employees prefer cafeteria–style benefit plans. For these
plans, the employees vote on the benefits that they prefer, and only those benefits receiving the
highest votes are offered to employees.
188. As a salesman, Ron’s pay is based on a percentage of his total sales. This type of pay
arrangement is known as a commission.
189. When Tim joined Alamo Scientific as a sales manager, part of his sign-on bonus included
the opportunity to buy up to 500 shares of the company’s publicly traded stock at $10 per share,
during the first three months of employment. The stock was trading on the NASDAQ exchange for
$22 per share. Tim’s new company was offering a
dividend reinvestment plan
.
190. Employees at The Eastern Eagle newspaper are paid according to the Hay system. Ralph
and Steve do the same type of work and report to the same supervisor. Ralph has worked at the
newspaper for 14 years while this is Steve’s third year. The supervisor believes Steve is the more
enthusiastic and hard-working of the two. Under the Hay system, Steve will probably earn more
than Ralph.
191. The Amabala Corporation is reorganizing to make more extensive use of teams. The
company plans to continue paying its workers based on their individual performance. This
approach is likely to maximize the success of the team by encouraging all team members to exert
their best effort.
192. Employees at MAX Card, a worldwide credit card business, are criticizing the company’s
fringe benefits package because it forces all employees to accept the same benefits regardless
of differences in their personal needs. In fact, they even offer some soft benefits such as an on–
site day care that over 80% of the employees are too young or too old to use. MAX should
consider a cafeteria-style benefits plan.
193. Examples of soft benefits that a firm might offer are: onsite medical physician services,
and exercise centers.
194. Flextime plans are popular with employees because they allow them to work fewer hours
while still earning the same income.
195. A common feature of flextime plans is the establishment of core times when all employees
are expected to be at their job stations.
196. Flextime plans are particularly well suited for workers on an assembly line.
197. In a compressed workweek, employees work more hours each day, but work fewer days
each week.
198. Almost 13 million U.S. workers now work from home at least one day a week.
199. Allowing employees to work from home can actually save employers money by reducing
their need for office space.
200. Job sharing has received a great deal of attention in recent years as more women with
small children have entered the labor force.
201. Job sharing tends to increase absenteeism and tardiness, because part-time workers are
not as dedicated and loyal as full-time workers.
202. A disadvantage of job sharing is that it requires a firm to hire, train, motivate, and
supervise more employees.
203. Most companies that have tried job sharing have concluded that the extra cost of hiring
and training additional workers outweigh its benefits.
204. Hot desking means sharing a desk with another employee.
205. Most employees who use flextime prefer to work independently of others. In order to
accommodate this preference, businesses permit them to clock in and out as they wish, as long
as they put in the necessary 40-hour work week. On some days, they may arrive at 6:00 a.m.,
while on other days they may decide to come in at noon.
206. Akiko works for a company that allows her to choose when she begins and ends her
workday, as long as she works a required number of hours and is at her job station at certain
specified core times. Akiko’s company is using a compressed workweek plan.
207. Olivia’s company announced that it is going to implement a compressed workweek
schedule. If Olivia takes part in this plan, she will be allowed to work fewer hours each week, as
long as she completes all assignments.
208. Melville Bank is about to implement a job-sharing plan. The bank is likely to find that
scheduling workers for peak periods will become easier as the result of this policy.