Scenario 9.1
Denton and Denton Inc. (D&D Inc.) is a small graphic design firm that designs tray liners for various small food chains across Canada and a major chain in the United States. D&D currently has 20 employees who are paid hourly rates for time worked, not projects completed. These workers consider themselves valuable, knowledge-based workers, and now that the company is expanding its client base they are not happy with the current pay structure. Management claims that this pay structure, ranging from $20 to $65 per hour, is based on collapsing the pay ranges for four job bands.
-Refer to Scenario 9.1. Which of the following is NOT a benefit of competency-based pay system?
A) greater productivity
B) decreased compensation costs
C) improved staffing flexibility to meet production or service demands
D) reduced effects of absenteeism and turnover

Question

Quizplus · Accepted Answer

Competency-based pay systems focus on rewarding the skills, knowledge, and performance of employees rather than the specific job they perform. While they can lead to greater productivity, improved staffing flexibility, and reduced effects of absenteeism and turnover by motivating employees and aligning their skills more closely with the company's needs, they do not inherently decrease compensation costs. In fact, these systems can sometimes increase costs because they require ongoing assessment of competencies and may lead to higher pay for employees who gain new skills or competencies.

Scenario 9.1 Denton and Denton Inc. (D&D Inc.) Is a Small Graphic