Part 1 – Compensation Systems (45 marks) (Syllabus 1-2)

| March 17, 2019

Part 1 – Compensation Systems (45 marks) (Syllabus 1-2)

1.1 Outline the key goals of a compensation strategy. (5 marks)

1.2 Expectancy Theory and Equity Theory (pages 331-333 in textbook) explain how a compensation system can motivate or de-motivate employees. Use Maslow’s Hierarchy of Needs to identify an example of an Intrinsic reward and an Extrinsic reward in a Total Rewards system that would support each of the five different levels. (10 marks)

1.3 Explain what a Pay Mix is. Briefly describe four internal factors and four external factors mentioned in your textbook which can influence the rates at which employees are paid.

(10 marks) (14 marks in total)

1.3.1 Besides a legislated increase in the minimum wage, discuss how a change in one

of these factors could impact pay rates. (2 marks)

1.3.2 Describe one method you could use to determine whether a compensation system is achieving its intended goals. (2 marks)

1.4 Define what job evaluation is (1 mark) and explain the differences between the following job evaluation systems, noting the advantage(s) and disadvantage(s) of each:

1.4.1 Job Ranking System (2 marks)

1.4.2 Job Classification System (2 marks)

1.4.3 Point System (2 marks)

(7 marks in total)

1.5 For the position you created the Job Posting for in BUSI-1401: (9 marks in total)

1.5.1 Research 3 different sources to determine the market value of this position, citing each source and then recommend a salary range (starting salary – median salary – top salary); for salary only. (7 marks)

1.5.2 Define Pay for Performance and describe two different types of Incentive Rewards which you feel would be suitable for this position assuming for the purpose of this question that the position is in a private sector/non-unionized workplace. (2 marks)

Part 2 – Payroll (20 marks) (Syllabus 5)

2. When hiring or terminating an employee, Payroll relies on HR to provide accurate and timely information that is legislatively compliant.  Assume you are the HR Generalist at ACME Inc. who manufactures widgets and unfortunately are downsizing four employees due to a permanent reduction in work beyond the control of the employer. The last day of work for these four employees will be December 14, 2018, which is a pay date.

Two employees are hourly, work in the plant and are unionized; two employees are salaried, work in the office and are exempt from the union. You will be giving each employee pay in lieu of notice. For simplicity in this exercise, assume that Employment Standards minimums apply for all employees.

For each employee, advise Payroll:

2.1 How many weeks of pay in lieu of notice (ESA 29(2)) will be given? (4 marks)

2.2 How much vacation pay (ESA 11(2)) they should be paid? (4 marks)

2.3 A high-low range for severance with your recommendation to the business owner regarding how much severance to offer in the termination letter (research & cite your sources)

(8 marks)

2.4 When are the Records of Employment due? And what is the reason code for termination? (4 marks)

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