Determination of the Pay

by | Oct 20, 2021 | Homework Help

The Factors That Influence the Determination of the Pay. Write a 2000 word paper answering; This paper will discuss the objectives of pay, the factors that influence the determination of the pay and the various forms that pay can take place. A company has a certain objective when deciding the pay scale on which all the employees have to be paid. First, the objective is determined and then the pay scales are formulated accordingly so that the pay is following and fulfilling the objective in mind. Companies can have various objectives. The first and the foremost one is that companies are trying to recruit, retain and then motivate their employees through the pay scale. Recruitment becomes easy if the company is paying more than the industry average. All prospective employees searching for jobs will consider the company as one of the most lucrative places to work if it is paying more than the industry average. Moreover, it also contributes to a very positive and appealing employer branding of the company in the eyes of the prospective employees. Once a person has been hired as an employee, a good pay scale will help in recruiting him for a long period of time, even if he gets offers from other companies to join them. moreover, motivation to perform better and to give increased levels of productivity are also one of the major objectives that can be linked with the pay. (Brown, pg 17, 2003) The second type of objectives that a company can have are that which are part of broader organizational objectives, for instance, if the company has decreased the amount of pay it is giving to its employees, then it is using this action as a contribution to the broader organizational objectives of controlling costs and cutting down on the expenses of the company. if the company wants to be competitive in nature, then its objectives as far as pay is concerned, will be to increase the pay so that it can get that edge over competitors. Other objectives can be that the company keeps a certain purchasing power position for its employees and gives them pays accordingly. (Locke, p234, 1995) It will help the company to see exactly how much purchasing power does its employees have in relation to the present economy. Objectives of fairness and equity can also be achieved by paying well. For instance, the motivation and productivity of the company’s employees are also directly linked with how much fair the pay system is. If one person is giving less input than another person, is he getting less output than the other person Is there any sort of inclination towards certain employees when it comes to the pay systems This is linked to the concept of “a fair days pay for a fair days work” since everyone wants to get that share of the pay which they deserve and they do not want to see others getting more pay with less work. Thus, equity has to be maintained and the right balance between work and pay should be tried to achieve by the employers so that pay can be performance-related, rather than time-related. Time-related pay leads to the employee getting too complacent about his work responsibilities and he might not be as productive as he can be in actuality. Lastly, the objectives of pay can also be linked to regularity, security, improvement and development.

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