What is a drawback of setting pay rates based strictly on a pay policy line?
A) It increases the administrative burden of managing the compensation system.
B) Employees have difficulty interpreting regression analysis.
C) The estimated pay for a job may not reflect conditions in the labor market.
D) It increases the costs of surveying the market.
E) It groups jobs, which will result in rates of pay for individual jobs that precisely match the levels specified by the market.

Question

Quizplus · Accepted Answer

Pay policy lines may not accurately reflect the external labor market as they are based on internal factors such as the organization's structure and its desired pay structure. As a result, the estimated pay for a job may not reflect conditions in the labor market, leading to difficulties in attracting and retaining skilled employees.

What Is a Drawback of Setting Pay Rates Based Strictly