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What are the 3 components of total compensation?
- base compensation
- pay incentives
How much of a cost does compensation represent to most firms?
Compensation in the single most important cost in firms.
Explain the difference between external equity and internal equity.
External equity is equity with the whole labor market. Internal equity is equity with other workers doing the same job.
What happens if we decide that our pay is not fair?
- Ask for a raise
- Evaluate the economy
- Leave job.
Explain the distributive justice model of pay.
Holds that employees exchange their contributions or input to the firm (skills, effort, time, and so forth) for a set of outcomes.
Explain the labor market model of pay equity.
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