What legal obligations must a company meet in setting up a pay structure? Which of these would be the most challenging for a small organization? Why? Use examples from your personal experiences or current events to support your answer.
Analyze each of the following jobs and determine whether you think the pay for these jobs should emphasize base pay or incentive pay. Explain why using your personal experiences or current events.
a. An accountant at a manufacturing company.
b. A salesperson for a retail company.
c. A CEO.
d. A physician at a hospital.
Analyze the benefits and consequences of incentive pay being linked to an individual’s performance. How can these consequences be resolved?
Read “Taking Responsibility: Continuum Health Partners Link Pay to Costs, Quality of Care” at the end of chapter 12 and answer the following questions:
a. How well do you think that Continuum’s experiment with pay performance linked incentive pay to relevant performance measures? Be specific and explain why.
b. Do you think that the gainsharing program would be beneficial for the company’s non-medical support staff? Why or why not?
c. If you were to create a balance scorecard for Continuum’s top executives, what performance measures would you include? To which of these measures would you tie the majority of their compensation? Why?