Bonus Pay Plan

What are the legal and ethical issues surrounding the use of the Internet (specifically, social networking sites such as Facebook, Twitter, etc.) by individual employees for human resource activities? Are you concerned about violations of your own privacy because of these kinds of web applications? Have you ever encountered a breach in your privacy in an organization due to use of the Internet? If you do not have a personal example of a breach in your privacy, please share an example that you have observed in the workplace.

Read the Application Case 11-1, “Customizing Bonus Pay Plans,” on pages 348-352 of the textbook. Answer the three (3) discussion questions on page 352.

Why is it important to include operating employees (non-managers)
in the development and use of an incentive program?
Navigant Consulting Inc. previously has a short term incentive pay system which was flawed and had no consistent method of rewarding performance so they redesigned the system. The short-term cash bonus plan has two elements which included incentive pay for the senior professionals based on performance and the administrative staff were rewarded according to performance. The new system led to the company recovering from years of losses. Linking the pay of non-managers to performance led to motivating employees and improved the corporation as a whole.
What is the individual performance modifier that the Towers Perrin survey identified?
Explain it in managerial terms.
The individual performance modifier that Towers Perrin survey identified was found in 62 percent of companies with an orgaizationwide incentive plan. This individual performance modifier was where an employee is measured against preestablished personal goals for the year and then rewarded for achieving specific goals. The goals were established to directly influence a behavior. An example used was to pay clerks double time for any sick days not used.
American Woodmark’s scorecard approach can be most effectively used with what type of organizations? Employees? American Woodmark’s scorecard approach was an incentive pay system developed with company goals in mind. Goals were divided into areas of cost, quality, deliver, and safety. Lower level goals were set to support these so that if each of the plants met targets the result would be the achievement of company wide targets and if each team met targets then a plant would meet targets and so on down to the individual level. This was a complex system with many different targets to meet and are tough to manage. This system encompassed the management of individual goals with the management of plants and company goals in
mind.
Ivancevich, J. M. (2010). Human resource management. (11 ed., pp. 348-352). McGrawHill.
What is meant by the term mandated benefit? Describe government-mandated benefits. What are the advantages and disadvantages of each?
The book states there are three benefits programs offered by private and not-for-profit employers that are mandated by federal and state governments.
An employer has no choice about offering mandated benefits programs and cannot change them in any way without getting involved int the political process to change the existing laws. The three mandated programs are unemployment insurance, social security, and workers’ compensation.
Unemployment insurance is designed to provide cash income to workers during short period of involuntary employment. It helps workers find jobs. It encourages employers to stabilize employment. It stabilized labor supply by providing benefits so that skilled workers are not forced to seek other jobs during short period of unemployment.
Social Security established pension to retired people to supplement savings, pensions and part-time work. The basic concept is an employee pays taxes and would later receive this program. Social Security taxes are paid by both the employer and employee. Due to the increase in the eligible individuals and the pay out difference from what was originally paid in this benefit is slowly dwindling. The growth of international business has created other problems for retrieving these
payments.
Workers’ Compensation is a financial protection of an employee who incur expenses as a result of a job-related illness or accident. Employers pay the cost of this insurance. The amount of this cost is tied directly to the employer’s past experience with job-related injuries. Worker’s Compensation is growing increasingly expensive and are expected to escalate. Fraudulent claims have become an issue and several states are seeking alternatives to this.
Ivancevich, J. M. (2010). Human resource management. (11 ed., pp. 348-352). McGrawHill.