The Pay Model In Canada
CHAPTER
1
THE PAY MODEL
LEARNING OUTCOMES
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Describe how compensation is viewed differently by society, stakeholders, managers, and employees in Canada and around the world. Discuss major components of total returns for work. Describe the four strategic policies in the pay model and the techniques associated with them. Discuss the objectives of compensation in the pay model.
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A friend of ours writes that she is in the touring company of the musical Cats. In the company are two performers called swings who sit backstage during each performance. Each swing must learn five different lead roles in the show. During the performance, the swing sits next to a rack with five different costumes and makeup for each of the five roles. …show more content…
For example, a comparison of earnings of women with those of men highlights what many consider inequities in pay decisions. The gender pay gap in Canada for full-time, full-year workers narrowed from 42 percent in 1967 to 30 percent in 2000. Despite this narrowing, and despite pay equity legislation, the gap persists, and always to the benefit of men. The latest studies show that, because women often withdraw temporarily from the labour force for family-related reasons, the resulting reduction in their experience has a serious impact on pay over the long term. For workers with less than two years’ experience, the gap is only four percent, but it still exists.2 However, a large portion of the wage gap still has yet to be explained. Sometimes differences in compensation between countries are listed as a cause of loss of North American jobs to less developed economies. As Exhibit 1.1(a) reveals, labour costs in Mexico are about fourteen percent of those in Canada.3 However, Exhibit 1.1(b) shows that when differences in productivity (the relative output for each dollar of pay) are factored in, the wage advantage of Mexico, Korea, and Taiwan disappears. Productivity is highest in France, the United States, and …show more content…
However, even within an industry (e.g., automotive manufacturing, financial services), labour costs as a percent of total costs vary among individual firms. In addition to treating pay as an expense, a manager also uses it to influence employee behaviours and improve organization performance. The way people are paid affects the quality of their work; their attitude toward customers; their willingness to be flexible or learn new skills or suggest innovations; and even their interest in unions or legal action against their employer. This potential to influence employees’ behaviours, and subsequently the productivity and effectiveness of the organization, is another important reason to be clear about the meaning of
1
THE PAY MODEL
LEARNING OUTCOMES
■
■ ■
Describe how compensation is viewed differently by society, stakeholders, managers, and employees in Canada and around the world. Discuss major components of total returns for work. Describe the four strategic policies in the pay model and the techniques associated with them. Discuss the objectives of compensation in the pay model.
■
A friend of ours writes that she is in the touring company of the musical Cats. In the company are two performers called swings who sit backstage during each performance. Each swing must learn five different lead roles in the show. During the performance, the swing sits next to a rack with five different costumes and makeup for each of the five roles. …show more content…
For example, a comparison of earnings of women with those of men highlights what many consider inequities in pay decisions. The gender pay gap in Canada for full-time, full-year workers narrowed from 42 percent in 1967 to 30 percent in 2000. Despite this narrowing, and despite pay equity legislation, the gap persists, and always to the benefit of men. The latest studies show that, because women often withdraw temporarily from the labour force for family-related reasons, the resulting reduction in their experience has a serious impact on pay over the long term. For workers with less than two years’ experience, the gap is only four percent, but it still exists.2 However, a large portion of the wage gap still has yet to be explained. Sometimes differences in compensation between countries are listed as a cause of loss of North American jobs to less developed economies. As Exhibit 1.1(a) reveals, labour costs in Mexico are about fourteen percent of those in Canada.3 However, Exhibit 1.1(b) shows that when differences in productivity (the relative output for each dollar of pay) are factored in, the wage advantage of Mexico, Korea, and Taiwan disappears. Productivity is highest in France, the United States, and …show more content…
However, even within an industry (e.g., automotive manufacturing, financial services), labour costs as a percent of total costs vary among individual firms. In addition to treating pay as an expense, a manager also uses it to influence employee behaviours and improve organization performance. The way people are paid affects the quality of their work; their attitude toward customers; their willingness to be flexible or learn new skills or suggest innovations; and even their interest in unions or legal action against their employer. This potential to influence employees’ behaviours, and subsequently the productivity and effectiveness of the organization, is another important reason to be clear about the meaning of