COURSE OBJECTIVE

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COURSE OBJECTIVE

• DEVELOP AN UNDERSTANDING OF
• CONCEPTS
• PRINCIPLES
• PROCEDURES
• PROCESSES
• PROGRAMS
• AS THEY RELATE TO THE DESIGN AND
  ADMINISTRATION OF AN EFFECTIVE COMPENSATION SYSTEM

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Teaching Assistant Amy Chiu
Pager No. 713-620-1696
camy_at_bayou.uh.edu
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COURSE OVERVIEW

• The Text Assignment for this Course is
• "COMPENSATION MANAGEMENT" 7th edition
• BY R. HENDERSON
• And it will be augmented by an Exercise Book
• "COMPENSATION MANAGEMENT 7th edition
• By R. HENDERSON

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Principle Areas Of Study

• Macro View (Chapter 1 - 5)
• Provides a broad view of compensation management
  and identifies some of the major factors that
  influence compensation opportunities.

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Principle Areas Of Study

• Micro View (Chapter 6 - 12)
• Contains the "nuts and bolts" or detailed
  analysis of compensation in organizations and
  deals with how job requirements are identified,
  defined, and valued.

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Principle Areas Of Study

• Micro - Macro View (Chapters 13 - 17)
• Combines the micro - macro analysis by explaining
  how a base pay program is expanded into a total
  compensation system that includes various short
  and long-term incentives.

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Seven Classes Of Society In The US

• CLASS ANNUAL INCOME (000) POPULATION
• UPPER
• RICH 1,000 TO 1,000
• MIDDLE
• UPPER 85 TO 250 6 MIDDLE
  45 TO 85 25 LOWER 25 TO
  45 37
• LOWER
• WK POOR 15 TO 25
  17 POVERTY TO 15
  13
• ANNUAL INCOME IS FOR A FAMILY OF FOUR

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Work Force Demographics

• (JAN 1996)
• Population Of The US 262.8
• Non-institutionalized - 16 Yrs And Up 198.6
• Civilian Employment 132.3
• Unemployed Persons 7.4
• Labor Force In Non-ag Industries 121.5
• Full-time Employees 102.1
• Part-time Employees 22.9
• Employed Husbands 42.0
• Employed Wife 32.0
• Union Members 16.4
• Employed Mgrs And Professionals 35.6

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Reward System

• Focuses worker attention on the specific
  behaviors the organization considers necessary to
  achieve it desired objectives and goals.
• Includes anything that an employee may value and
  desire and that the employer is able and willing
  to offer in exchange for employee contributions.

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Reward System Components

• Compensation System
• Monetary Claims
• In-Kind Claims
• Non-Compensation System
• All Other Rewards

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Compensation System Components

• Monetary Claims
• Wages and salaries paid in the form of money, or
  in a form that is quickly and easily transferable
  to money at the discretion of the employee.

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Compensation System Components

• In-Kind Claims
• Goods and services made available and paid for
  either totally or in part by the employer. The
  value of any in-kind payment depends directly on
  the employee's perception of its worth.

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The Total Compensation Package
An Eight Dimensional Classification Scheme

• Pay For Work Performed
• Base Pay
• Premiums
• Short Term Bonuses

• Pay For Time Not Worked
• Vacations
• Holidays
• Funeral Leave
• Jury Duty

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The Total Compensation Package

• Loss-of-job Income Continuance
• Unemployment Compensation
• Severance Pay
• Supplemental Unemployment

• Disability Income Continuation
• Social Security
• Workers Compensation
• Sick Leave
• Disability Pay Plans

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The Total Compensation Package

• Deferred Income
• Social Security
• Pension Plans
• Savings Plans
• 401-k Plans
• Supplemental Retirement Income

• Spouse (Family) Income Continuation
• Social Security
• Life Insurance
• Pension Plans
• Workers Compensation

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The Total Compensation Package

• Health, Accident, And Liability Protection
• Medical Insurance
• Dental Insurance
• Workers Compensation

• Income Equivalent Payments (Perks)
• Company Car
• Subsidized Food Service
• Child Care Services
• Legal Services

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Non-Compensation System Dimensions

• Enhances dignity and satisfaction from work
  performed.
• Enhances physiological health, intellectual
  growth, and emotional maturity.
• Promotes constructive social relationships with
  co-workers.
• Designs jobs that require adequate attention and
  effort.

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Non-Compensation System Dimensions

• Allocates sufficient resources to perform work
  assignments.
• Grants sufficient control over the job to meet
  personal demands.
• Offers supportive leadership and management.