Martocchio (2015), in Chapter 3, indicates that merit pay plans appears to be the most common form of compensation in the United States. Although widely used, these
systems are not suitable for all kinds of jobs. Based on your knowledge of merit pay systems, identify at least three jobs for which merit pay is inappropriate.
/ Two employees perform the same job, and each received exemplary performance ratings. Is it fair to give one employee a smaller percentage merit because his pay falls
in the third quartile but give a larger percentage merit increase to the other because his pay falls within the 1st quartile? Explain your answer./ Why pay more just
because the employee has been around for a long time. For example, an accountant who has been in the same job 15 years does not have 15 years’ experience; that
accountant has 3 years’ experience, 5 times over. Keep in mind a job has a market based on survey. The job if done satisfactorily should be paid market. Why pay for
longevity?/Should companies pay for employee loyalty? How can loyalty be measured? How does loyalty contribute to bottom line? Do employers value loyalty or employees
who just hang in there?/Discuss your views about whether discretionary employee benefits should be an entitlement or something earned based on job performance.
/How do differing perspectives affect our views of compensation?/ Discuss the factors that influence internal pay structures. Based on your own experience, which ones
do you think are the most important? Why?
Draft a response to each of the bulleted questions below. Each question must have its own response and have a minimum of 75 words.
1. Martocchio (2015), in Chapter 3, indicates that merit pay plans appears to be the most common form of compensation in the United States. Although widely used,
these systems are not suitable for all kinds of jobs. Based on your knowledge of merit pay systems, identify at least three jobs for which merit pay is inappropriate.
2. Two employees perform the same job, and each received exemplary performance ratings. Is it fair to give one employee a smaller percentage merit because his
pay falls in the third quartile but give a larger percentage merit increase to the other because his pay falls within the 1st quartile? Explain your answer.
3. Why pay more just because the employee has been around for a long time. For example, an accountant who has been in the same job 15 years does not have 15
years’ experience; that accountant has 3 years’ experience, 5 times over. Keep in mind a job has a market based on survey. The job if done satisfactorily should be
paid market. Why pay for longevity?
4. Should companies pay for employee loyalty? How can loyalty be measured? How does loyalty contribute to bottom line? Do employers value loyalty or employees
who just hang in there?
5. Discuss your views about whether discretionary employee benefits should be an entitlement or something earned based on job performance.
6. How do differing perspectives affect our views of compensation?
7. Discuss the factors that influence internal pay structures. Based on your own experience, which ones do you think are the most important? Why?
8. On the topic of delayering, Milkovich et al (2014) described benefit derived by reducing layers in the organization. What would be advantages and
disadvantages of combining duties in job families and reducing the number of levels in job family?
