Chapter 11: Establishing Strategic Pay Plans

DISCUSSION QUESTIONS
1. What is the difference between exempt and non-exempt jobs?
2. Should the job evaluation depend on an appraisal of the jobholder's
performance? Why or why not?
3. What is the relationship between compensable factors and job
specifications?
4. Compare and contrast the following methods of job evaluation: ranking,
classification, factor comparison, and point method.
5. What are the pros and cons of broad banding, and would you recommend
your current employer (or some other firm you're familiar with) use it? Why
or why not?
6. It was recently reported in the news that the average pay for most
university presidents ranged around $250,000 per year, but that a few
earned much more. For example, the new president of Vanderbilt received
$852,000 in one year. Discuss why you would (or would not) pay university
presidents as much or more than many corporate CEOs.
7. Do small companies need to develop a pay plan? Why or why not? Yes,
small companies need to develop a pay plan.
Continuing Case: Carter Cleaning Company The New Pay Plan
1. Is the company at the point where it should be setting up a formal salary
structure complete with job evaluations? Why?
2. Is Jack Carters policy of paying 10% more than the prevailing wage rates
a sound one, and how could that be determined?
3. Similarly, is Carters male-female differential wise, and if not, why not?
4. Specifically, what would you suggest Jennifer do now with respect to her
companys pay plan?