11) SET I. Chapter 4. Forms of Compensation.

1. This philosophy enables employees to receive salary increases

every year regardless of performance.

• a. Performance Philosophy

• b. Entitlement Philosophy

• c. Contingent Pay

• d. Compensation Philosophy

2. This philosophy reflects pay increases given to deserving employees

based on their performance.

• a. Performance Philosophy

• b. Entitlement Philosophy

• c. Contingent Pay

• d. Compensation Philosophy

3. The pay added to the base pay. It is usually dependent on individual, team,

and organization-wide performance.

• a. Performance Philosophy

• b. Entitlement Philosophy

• c. Contingent Pay

• d. Compensation Philosophy

4. Contingent Pay that is associated with individual performance,

contribution, competency, or skill.

Performance is measured vis-a-vis existing performance standards.

• a. Organization-wide Contingent Pay

• b. Team Contingent Pay

• c. Individual Contingent Pay

• d. Competence Contingent Pay

5, Performance Per Unit Scheme where the employee is paid for every unit produced and

the wage is determined by multiplying the number of units by the rate per unit.

• a. Piece rate

• b. Standard hour plan

• c. Output Standard

• d. Production rate

6. Similar to a Piece Rate plan, except that there is a standard time set to complete a task.

• a. Piece rate

• b. Standard hour plan

• c. Output Standard

• d. Production rate

7. A holistic approach to determine pay. It looks at all aspects of performance and

how they contribute to organizational objectives.

• a. Competency-based pay

• b. Skill-based pay

• c. Contribution-based pay

8. It is based on the overall performance of the team. This encourages cooperation and teamwork as members of the team perceive the team's performance as a product of their collective efforts.

• a. Organization-wide Contingent Pay

• b. Team Contingent Pay

• c. Individual Contingent Pay

• d. Competence Contingent Pay

9. They are employees who take advantage of the performance and efforts of other

members of the team. They do not contribute and their presence reduces the

motivation of other members.

• a. Team leaders

• b. Ghost employees

• c. Free riders

• d. Model employees

10. Employees are rewarded not only as individual performers or team players,

but also as stakeholders.

• a. Organization-wide Contingent Pay

• b. Team Contingent Pay

• c. Individual Contingent Pay

• d. Competence Contingent Pay