If compensation is not tied directly to performance, what might and should it be tied to? To answer these questions, consider how wages and salaries are set in many organizations. Perhaps the most common approach involves something like the following. The firm looks at compensation rates in the local labor market for similar jobs or for jobs with similar skill requirements. Some adjustment will take place according to the firm's experience. If positions are hard to fill, the firm might raise compensation; if there is a long queue of applicants, firms might lower pay rates (or, at least, not move them up with inflation). Sometimes a firm will adjust the rates upward in an attempt to broaden the applicant pool or reduce turnover that is, the firm will pay efficiency wages. Of course, all this is subject to negotiation with a union if the job in question is covered by collective bargaining. Equally of course, it is clear that such a procedure leads to a rough-and-ready approximation to wages set by the economic slogan supply equals demand. leia todo o artigo
a multi-disciplined approach to achieving organisational objectives by making the best use of knowledge
