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Compensation Management Question Paper

Compensation Management

Course:Bachelor Of Business Management

Institution: Moi University question papers

Exam Year:2011

UNIVERSITY EXAMINATIONS: 2010/2011
SECOND YEAR EXAMINATION
COMPENSATION MANAGEMENT
DATE: AUGUST 2011 TIME: 2 HOURS
INSTRUCTIONS: Answer question ONE and any other TWO questions
Question One
a) With the use of illustration, how a HRM can use the pay model to achieve fairness, efficiency and
compensation objectives. (10 Marks)
b) Explain five ways in which the HR can utilize information obtained from job evaluation to achieve compensation objectives. (10 Marks)
c) You have been appointed to head a recruitment team at Secumax ltd, a locally incorporated company dealing in electronic appliances. They are currently recruiting sales representatives.
Identify five compensable factors for a sales representative job? Why is it important for a HR to identify the compensable factors? (10 Marks)
Question Two
a) The purpose of a pay structure is to provide a fair and consistent basis for motivating and rewarding employees. It seeks to ensure a framework, which is internally equitable and externally competitive rewards for an organization. Explain Five ways through which the HR can achieve this?
(10 Marks)
b) External competitiveness refers to the pay relationships among organizations or the organizations
pay relative to its competitors. Explain at least two ways in which the HR can determine external
competitiveness. (8 Marks)
c) Identify two circumstances under which a HR can successfully implement a lag policy. (2 Marks)
Question Three
a) Write brief notes on the following. Illustrate your answers.
i) Factors considered in developing group bonus schemes
ii)Shareholders view on compensation
iii) Compensation objectives
iv) Seniority based pay (12 Marks)
b) Explain how the following factors affect internal structures. Illustrate your answers
i) External stakeholders
ii)Organizational culture
iii) Organizations strategies
iv) Organizations human capital (8 Marks)
Question Four
As an associate member of the institute of human resources, you have been invited to give a
presentation on employee benefits. Briefly outline your presentation under the following sub headings
a) Justification for employee benefits
b)Statutory benefits and their importance
c) Factors considered in benefit planning
d)Effective administration of benefits (20 Marks)
Question Five
a) Performance Related Pay links pay to performance of an individual, group or corporation. To compensation. It acts as a motivator through both providing incentives in the form of monetary rewards and by recognizing achievements. With the use of illustrations, explain five key success factors in performance related pay. (10 Marks)
b) Explain how the following factors affect the remuneration package. Illustrate your answer.
i) Labor market conditions
ii) Ability to pay
iii) Trade unions
iv) Government legislation
v) Individual performance (10 Marks)

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