Term
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Definition
| Adjusting the dates when stock options are granted. If the stock price goes up, it can increase compensation. It can be illegal. |
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Term
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Definition
| Two outcomes related to pay: one for performing below standard and other for meeting or exceeding the standard. |
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Term
| Employee Stock Ownership Plans (ESOPs) |
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Definition
| Sell stock to workers to give them financial stake in company. Allocations made to employee's account based on relative base pay. |
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Term
| Expectancy/Instrumentality Theory |
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Definition
| Reward will motivate employees to improve their job performance, when all 3 conditions are simultaneously satisfied: high valence, high instrumentality, and high expectancy. |
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Term
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Definition
| Employees' perception about the value of the reward |
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Term
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Definition
| Perceived link between job performance and rewards |
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Definition
| Perceived link between effort and job performance. |
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Definition
| Group incentive system based on productivity or cost reduction, not profit. Rewards given out frequently rather than annually. |
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| Improshare (Improved Productivity Through Sharing) |
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Definition
| Similar to Scanlon plan except that the ratio uses standard hours rather than labor costs; savings in hours result in reward allocation to workers |
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Term
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Definition
| Reply on countable results as basis for setting PFP rate. Usually based on units produced. |
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Term
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Definition
| Distribution of pay based on an appraisal of a workers' performance. |
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Term
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Definition
| Award units based on short and long term measures. Units later translated into stock rewards. |
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Term
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Definition
| Worker is paid per unit of production |
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Term
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Definition
| Motivates cost savings by allowing workers to share in benefits of increased profits. |
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Term
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Definition
| Bonus shares have restrictions, executive may not leave firm or sell stock for specified time. |
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Term
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Definition
| The most common gain-sharing plan, measures the relationship between the sales value of production and the labor costs. |
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Term
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Definition
| Includes the value of all supplies materials and services resulting in a bonus formula based on the value added to the product per labor dollar; thus, an incenive is created to save on all inputs, including materials and supply |
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Term
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Definition
| Piece-rate where the standard is set in terms of time instead of units produced. |
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Term
| Stock appreciation rights |
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Definition
| Does not involve buying stock. Having been awarded rights to a stock at a fixed price for a specified period, the executive can call the option and receive the difference between the fixed and market prices in cash. |
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