Just-Meaningful Pay Increase
Essay Questions
1- Discuss the concept of a “just-meaningful pay
increase.”
A successful answer should contain several elements. First,
a student should discuss the notion of perception. The pay increase must be
seen by employees as making a meaningful change in compensation. A discussion
of equity theory would be appropriate. Second, students should discuss
cost-of-living differences among individuals. Students may also want to discuss
the link between pay and motivation. Will the pay increase necessarily have the
performance effects a company is looking for?
2- A company of 15 employees has recently decided to
overhaul its performance appraisal system. Which plan would be most appropriate
for the company to adopt? Why?
An answer should consider why the size of the company is of
importance in considering the adoption of a performance appraisal plan.
Further, the students should discuss the relative merits and liabilities of the
different categories of performance appraisal methods (trait systems,
comparison systems, behavioral systems, and goal-oriented systems). Students
may also consider the supervisors’ appraisal approaches as well as the
compensation specialists’ skills in designing and implementing such plans. The
corporate and compensation strategies, respectively, are also important.
