.According to a recent report by the Society for Human Resource Management, “many job evaluation methods are subjective. Evaluators’ decisions about which jobs are worth more can be personal and emotional. If the evaluation team knows the job incumbents, they may consider employees’ personal qualities as job factors” (www.shrm.org. . Performing job evaluations). Based on what you have learned in this chapter, how can job evaluation be made more objective? Explain.
2.For the past 90 years or so, job evaluation as a compensation tool has been designed to assess the value of each job rather than to evaluate the person doing the job, prompting a relatively flat pay schedule for all incumbents in a particular position. Some HR experts believe that the emerging trend is for pay inequality to become “normal.” Employers are using variable pay to lavish financial resources on their most prized employees, creating a kind of corporate star system. “How do you communicate to a workforce that isn’t created equally? How do you treat a workforce where everyone has a different deal?” asks Jay Schuster of Los Angeles–based compensation consultants Schuster-Zingheim & Associates, Inc. If you were asked these questions, how would you answer them? Given the issues just discussed in this case, what effect do you think this trend toward greater pay inequality will have on employees’ satisfaction with their pay, their job, and life in general? Explain.
3.In 2002, Ford announced some of the details concerning the firing of former CEO Jacques A. Nasser, which followed a $5.4 billion loss during his last year in the job (Mullaney & Darnell, 2002). In addition to an annual pension for life of nearly $1 million (he is only 53 years old) and performance bonuses through 2003, he received full payment on stock granted to him in 2001. It isn’t known how many shares he received, but his 2000 award is now worth $5.8 million (Business Week, 2002, Jan. 14). This type of “golden parachute” or “sweet severance” package is not unusual when a corporation terminates a CEO for lackluster performance. Why do you think boards of directors approve of such deals for disgraced CEOs on the way out, when most employees who are laid off receive at most a few weeks’ severance pay? Is this practice in the company’s best interest? Explain.
4.Assume you run a small business. Visit the Web site www.dol.gov/elaws. Write a summary explaining: (1) the various retirement savings programs available to small-business employers, and (2) which retirement savings program you would choose for your small business and why.
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