encourage group performance and dispirit individual achievements.

have performance measures linked to the organization's goals.

have performance measures based on employees' requirements.

not be provided as a direct percentage of employees' performance.

be the same for all types of employees in the organization.

all the employees are paid equal amounts.

employees think that the pay plan is fair.

even the lowest performing employees get some rewards.

they focus on hiring employees for whom earning money is the only reason to do a good job.

employees focus only completing the task quickly.

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Merit pay

Stock ownership

Gainsharing

Profit sharing

Scanlon plan

routine, standardized jobs

innovative tasks

managerial jobs

jobs with difficult-to-measure output

non-standard jobs

profit sharing.

merit pay.

a Scanlon plan.

gain sharing.

commission

pay relative to performance of other workers in the industry.

ratio of pay to benefits.

comparable worth versus others.

the average worth of the skills possessed by the individual.

pay relative to average pay.

it provides merit increases to employees only on the basis of performance.

it results in a bigger short-term reward for the best performers.

it promotes group performance instead of promoting individual behavior.

it would never become costly for the employers.

it makes the reward more valuable by relating it to economic conditions.

It should be re-earned by employees during each performance period.

It lacks flexibility and hence it is less popular.

It is designed to reward group performance.

It is rolled into base pay and provided yearly or monthly.

It is not a one time reward in most of the cases.

commission.

profit sharing.

variable wage plan.

merit plan.

gain sharing.

Commissions

Gainsharing

Performance bonuses

Merit pay

Standard hour plans

Scanlon plan.

piecework rate.

team award.

group bonus.

merit pay plan.

They should produce products at a rate which is much higher than the standard production time.

They should create goodwill with customers and close as many sales as possible.

They should improve their performance year after year so that they re-earn the bonus during each performance period.

They should keep labor costs to a minimum and produce as much as possible with that amount of labor.

They should follow a defined set of quality standard to produce the desired outcome.

Bonuses are for bigger work groups whereas team awards are for small teams.

Bonuses reward attainment of goals measured in terms of physical output whereas team awards reward performance in terms of cost savings.

Bonuses are usually given to employees who meet deadlines whereas team awards are given only when the team as a whole meets the targets.

Bonuses encourages competition among individuals whereas team awards only foster cooperation.

Bonuses reward individual performance whereas team awards encourage cooperation.

Scanlon plan

Group bonus

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Profit sharing

Merit pay

Gainsharing

Sharing profit with the employees ultimately reduces the organization's profitability.

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Profit sharing is not directly linked to individual behavior.

They cost more when the organization experiences financial difficulties.

The employees may develop a narrow view of their roles in the organization.

They cannot be used to improve the organization's performance as a whole.

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stock ownership plans.

standard hour plans.

merit pay plans.

piece rate plans.

Scanlon plans.

high unemployment.

high economic growth.

slowdown in the company's growth.

downturns in the economy.

low inflation.

In stock options, stocks are placed into a trust whereas ESOPs give employees the right to buy a certain number of shares of stock.

Stock options carry significant risk whereas ESOPs are risk-free.

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Stock options are usually used with top management whereas ESOPs are provided to all employees.

Under stock options, employees can sell their stocks whereas ESOPs do not allow employees to sell their stocks.

Earnings from stock options are exempt from income taxes whereas earnings from ESOPs are taxable.

Employees can use ESOPs to buy their company during financial crises.

ESOPs require companies to invest 51 percent in the company's own stocks.

ESOPs provide very high risk-free retirement income.

Earnings of the trust holdings are exempt from income taxes.

The employees are provided with many more stocks than they actually own.

Scanlon plan

Gainsharing

Profit sharing

Merit pay

Balanced scorecard

It helps employees understand the organization's goals.

It reduces employee stress as it does not focus on financial targets.

It provides more pay to all employees in the organization.

It eliminates managerial effort when providing incentives to employees.

It eliminates the need to communicate the details of the plan to the employees.

federalism.

self ownership.

power system approach.

centralized decision making.

employee empowerment.

the organization's interests can be best protected.

the cost borne by the organization decreases.

monitoring performance becomes difficult.

the incentive plan has more chances of being successful.

administering the plans become simple.

It allows companies to deduct executive pay that exceeds $1 million.

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Rewarding the achievement of a variety of goals reduces temptation on the executive's part to gain bonuses by manipulating data.

It encourages executives to hold on to their stock options when the company is undergoing financial problems.

It forces executives to focus on company's long-term success because funds in ESOP are guaranteed by the Pension Benefit Guarantee Corporation.

In a balance scorecard, maximum points are given to ethical behavior.

Executives can roll in the stock price into their base pay to avoid paying a huge tax.

The executives can obtain as many shares as they need at a price that is much lower than the market rate.

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Executives can use the advantage of knowing the company's inside information to buy or sell stock and create huge personal gains.

Executives can use the employee stock ownership plan to buy their company if it is experiencing financial problems.

Executives do not inflate the stock price in order to enjoy bonuses.