Employee compensation is discussed in this week\'s module. Among others, two dif
ID: 449286 • Letter: E
Question
Employee compensation is discussed in this week's module. Among others, two different pay systems are discussed. One is time-based pay, which ties compensation to how may hours employees work. Another is knowledge based pay systems, which tie compensation to employee skills.
With some knowledge-based pay systems, compensation is not necessarily tied to hours worked. Therefore, employees have greater flexibility to set their own work schedules, as long as they get their assigned work done. On the other hand, it may expose them to being exploited by their employers, because their employers may overload them with projects without compensating them for extra hours worked.
In response to the latter, the President (see linked Huffington post article), is contemplating increasing the number of employees eligible for overtime pay. Currently, only those earning less than $23,660 are eligible for overtime pay. With his proposal, those earning less than $50,440 a year will be eligible for overtime pay. Thus, those earning between $23,660 and $50,440 will by default have to switch to a time based pay system.
Do you agree with the President's proposal? If so, explain why it's both a benefit to employers and employees. If you disagree, explain why, and propose an alternative that fixes the issue that the legislation is supposed to address.
Explanation / Answer
let the workers to do overtime, the workers who are getting income inbetween 23660 to 50440, it is a good idea to both employer and employee. to the employee point of view, he can get more salary to the same work which he performs. he can get more salary than the fixed one, when there is full of work, if there is no aditional work, they will get only the fixed salary.
in employer point of view, if there is aditional work, then he can offer aditional time to workers and aditional pay for the time. in this case the fixed cost is limited and predetermined, where as the variable cost will be there. but it occurs only when there is sufficient work only. if there is no aditional work, the limited salary is sufficient to pay, if there is aditional then aditional pay requires.
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