Chapt. 1 Compensation & Organizational Strategy –Support the strategic plans/actions of organization Accomplishing organizational strategy begins with determining: 1)Work that must be performed 2)Kinds and levels of knowledge/skill required 3)Quality of people needed 4)Rewards the organization can offer

Social Structure and Income Upper –Ultra rich> $ 1,000,000<.05 of 1% –Wealthy250,000-1,000,000< 2% Middle –Upper Middle100, ,0006% –Middle Middle60, ,00025% –Lower Middle35,000-60,00037% Lower –Working Poor19,000-35,00017% –Povertyto 19,00013% *Family of Four

Chapt. 2 Page 16 – Compensation System Page 18 – Compensation Dimensions/Components Page 21 – Noncompensation System

Chapt. 3 Major parts of compensation program –Base wages and salaries –Wage and salary add-ons –Incentive programs –Benefits & services

Determining Rates of Pay Kinds/levels of KSA’s Kind of business –Page 28 & 29 Union-nonunion status Capital intensive vs. labor intensive Size of business Philosophy of management

Total compensation package Geographic location –Page 31 Supply & demand of labor Profitability of firm Employment stability Gender difference Employee tenure & performance

Jobs & Pay in U.S. Global environment –Page 35 Deregulation & takeovers –Airlines –Trucking –Communications

Major Economic Theories Page 39 Classical wage theories Wage control theories Justification theories Behavioral economics theories Organizational economics theories

Wage supply/demand theory –Page 42