Job Architecture & Market Pricing Flashcards

What does a 'compa-ratio' of 0.85 indicate about an employee's pay?

Answer: The employee is paid 15% below the midpoint of their pay range

A compa-ratio below 1.0 means the employee's pay is below the range midpoint; 0.85 means pay is 85% of midpoint, or 15% below it.

Which job evaluation method ranks jobs by comparing each job against every other job using paired comparisons?

Answer: Paired comparison ranking

Paired comparison ranking systematically compares each job to every other job, resulting in a ranked order based on overall value.

In a broad-band pay structure, what is a key ADVANTAGE compared to a traditional multi-grade structure?

Answer: Greater flexibility to recognize individual performance and lateral career moves

Broad bands allow managers more discretion to differentiate pay within a wider range, supporting lateral development and performance-based differentiation.

Which factor would cause an organization to use a HIGHER number of pay grades in its salary structure?

Answer: A tall, hierarchical organization with many distinct job levels

Organizations with many distinct levels of authority and responsibility benefit from more grades to reflect the finer distinctions in job value.

When survey data shows a 'weighted average,' what variable is the data typically weighted by?

Answer: Number of incumbents reported by each participating company

Survey data is typically weighted by incumbent count so that companies with more employees in a role have proportionally greater influence on the aggregate figure.

A job evaluation committee assigns 'compensable factors' to rate jobs. Which of the following is a typical compensable factor used in point-factor systems?

Answer: Skill/knowledge required to perform the job

Compensable factors like skill/knowledge, effort, responsibility, and working conditions are inherent to the job itself and are used to assign point values in point-factor evaluation.

What is the MAIN risk of relying exclusively on a single compensation survey for market pricing?

Answer: Narrow participant pool may skew results and fail to represent the full labor market

A single survey may have a limited or biased participant pool; blending multiple surveys provides a more representative view of the labor market.