You have designed your merit pay grid so that employees with a "satisfactory" performance rating receive no merit increase if they are in the third and fourth quartiles,and a 3 or 4 percent merit increase if they are in the first or second quartile. What is the logic behind your decision?
A) You believe employees paid above the midpoint have already been rewarded for "satisfactory" work.
B) You believe this practice ensures procedural justice.
C) You believe it is important to maintain a compa-ratio of less than 1.
D) You believe pay raises should constitute a "just noticeable difference".

Question

Quizplus · Accepted Answer

The logic behind the decision is that employees who are paid above the midpoint have already been rewarded for their "satisfactory" performance, and therefore, they don't need an additional merit increase. Giving a merit increase to employees in the first and second quartile incentivizes and rewards better performance.

You Have Designed Your Merit Pay Grid So That Employees