Glossary
Base Pay
is compensation based on time worked, such as annual salary or an hourly wage and it does not include pay benefits, overtime or incentive pay.
Base Wage Rate (or base rate)
The basic wage or salary paid for a job, not including additional benefits or incentives and not reflecting differences in employee contributions.
Basic Pay Policies
Include decisions on the relative importance of 1) internal consistency, 2) external competitiveness, 3) employee contributions, and 4) the administration of the pay system. These policies form the foundation for the design and administration of pay systems and serve as guidelines for managing pay to accomplish the system’s objectives. (Compensation)
Policies that provide the foundation for the design and administration of an organization’s pay system. These policies should incorporate internal and external factors and weigh employee contributions.
Benchmark Conversion
Matching survey jobs by applying the employer’s plan to the external jobs and then comparing the worth of the external job with its internal “match.” (Compensation)
Matching and comparing benchmark jobs to pre-existing positions within an organization.
Benchmark job
(or key) job is a standard job from either within the organization or outside the organization used as a reference point for pay comparisons. These jobs have relatively the same job content and there is not much difference in their rates of pay.
Benefit Ceiling
is the maximum amount paid for specific benefit claims.
Benefits
are any form of indirect payment due to an eligible employee or his/her beneficiary under an employee benefit plan. These payments can include pension, medical and/or dental coverage.
Benefits Deduction
is the deduction from an employee’s pay to cover all or a portion of the premium of his/her benefits package.
Bonus
A lump-sum incentive payment given to an employee in addition to his/her base wage as a reward for reaching a predetermined target or goal.
Broadbanding
is the condensing of multiple salary grades into several broad and wide-ranging grades.