Page 163 - DMGT406_HUMAN_RESOURCE_MANAGEMENT

Human Resource Management

Notes 3. Shift payments are made at rates which usually vary according to the shift arrangement.
A premium of, say, one-third of basic pay may be given to people working nights, while
those on an early or late day shift may receive less - say, one-fifth of basic pay.

4. Working conditions allowances may be paid where the work is unpleasant.
5. Subsistence allowances may be paid for accommodation and meals when working away
from home.

6. Stand-by and call-out allowances may be made to those who have to be available to
come in to work when required.

Notes Job Evaluation
Job evaluation is a systematic process for defining the relative worth or size of jobs within
an organization in order to establish internal relativities and provide the basis for designing
an equitable grade structure, grading jobs in the structure and managing relativities.
It does not determine the level of pay directly. Job evaluation can be analytical or non-
analytical. It is based on the analysis of jobs or roles which leads to the production of job
descriptions or role profiles.
Market Rate Analysis
Market rate analysis is the process of identifying the rates of pay in the labour market for
comparable jobs to inform decisions on levels of pay within the organization. A policy
decision may be made on how internal rates of pay should compare with external rates -
an organization's market stance.
Grade and Pay Structures
Jobs may be placed in a graded structure according to their relative size. In such a structure
pay is influenced by market rates and the pay ranges attached to grades provide scope for
pay progression based on performance, competence, contribution or service. Alternatively,
a 'spot rate' structure may be used for all or some jobs in which no provision is made for
pay progression in a job.
Contingent Pay
Additional financial rewards may be provided that are related to performance, competence,
contribution, skill or experience. These are referred to as 'contingent pay'.
Contingent payments may be added to base pay, that is, 'consolidated'. If such payments
are not consolidated (that is, paid as cash bonuses) they are described as 'variable pay'.

Employee Benefits
Employee benefits include pensions, sick pay, insurance cover, company cars and a number
of other 'perks'. They comprise elements of remuneration additional to the various forms
of cash pay and also include provisions for employees that are not strictly remuneration,
such as annual holidays.

Self Assessment

State whether the following statements are true or false:

1. External equity is determined through job analysis.
2. An example of indirect compensation is 'pensions'.

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