Some employers pay their workers with a hybrid compensation program which is composed of a flat...

Some employers pay their workers with a hybrid compensation program which is composed of a flat salary plus incentive pay. For example, a pharmaceutical sales associate may be paid a base salary of $2,000 per month plus a 10% commission on their sales. The compensation scheme can be altered by offering more incentive for the workers (e.g., a lower base salary and a higher commission) or more safety and fairness for workers (e.g., a higher base salary and a lower commission). A hybrid pay scheme may overcome some of the drawbacks of incentive pay.

Suppose a firm uses sales teams to market their products. For example, a construction equipment manufacturer may assign three sales agents to a team so each team member can specialize in particular product functions (e.g., mechanical systems, electronic systems, and software systems). What are the potential drawbacks of hybrid pay for firms that employ sales teams? What are the drawbacks of hybrid pay for the members of the sales teams? Can we alter the hybrid scheme to overcome these drawbacks?

Expert Solution

The Hybrid pay system has following drawback:

Pay may become out of control = If the sales agent do exceedingly well on the ground, it can be beneficial for the firm but on the other hand, the high commission charges may bring down the profit % and they may be paid very high
Short term focus = In case of high component of commission, the sales agent prefer to focus on current goal of meeting the target and delivering number. It may result in some unhealthy practice which may be negative for the business
It can lead to motivation issue beyond a point as sales person do not feel connected with the firm. This may lower their morale and motivation to work. In case company doesn't spend on marketing, it may be very challenging for sales agent to sell

Yes, some drawbacks can be overcome by:

Having a cap on maximum amount that can be earned by sales agent
The company should support the sales agent during down phase of economy as sales may be low. This will help them to have higher morale
Training session should be organized to help agent have wider understanding and focus of business

keosha answered 2 years ago

The New Deal program that mandated that workers and employers pay into a national retirement fund...

The New Deal program that mandated that workers and employers pay into a national retirement fund for retired workers was (and is still) known as: A. the Agricultural Adjustment Act B. the Social Security Administration C. the Federal Deposit Insurance Corporation D. the Works Progress Administration

Many employers dislike workers’ compensation claims. Some even actively discourage employees from filing them. Why?

BIS 127Many employers dislike workers’ compensation claims. Some even actively discourage employees from filing them. Why? How does worker's comp claim affect an employer? Why do employers contest worker's comp when employees' file claims?

Workers’ compensation represents a compromise between the needs of employees and the needs of employers. True...

Workers’ compensation represents a compromise between the needs of employees and the needs of employers. True False Question 2 (2 points) Contributory negligence means that an employee knew that the job involved risk; he or she could not expect to be compensated when the risks resulted in accidents and injuries. True False Question 3 (2 points) There are three types of workers’ compensation insurance: state funds, private insurance, and self-insurance. True False Question 4 (2 points) Temporary disability: Is the...

Prior to the enactment of workers’ compensation statutes, what defenses would employers use in order to...

Prior to the enactment of workers’ compensation statutes, what defenses would employers use in order to avoid paying for employee injuries?

Why do employers provide employee benefits, rather thanproviding all compensation in the form of pay...

Why do employers provide employee benefits, rather than providing all compensation in the form of pay and letting employees buy the services they want? What are some advantages of offering a generous package of insurance benefits? What are some drawbacks of generous insurance benefits?

Employers pay about how much of the total wage and benefit compensation for health benefits, reducing...

Employers pay about how much of the total wage and benefit compensation for health benefits, reducing the amount that can be paid out as wages?

True or False. The FLSA does not require employers to pay hourly workers a minimum wage...

True or False. The FLSA does not require employers to pay hourly workers a minimum wage or overtime?

Write a C++ program that calculates pay for either hourly paid workers or salaried workers.

Write a C++ program that calculates pay for either hourly paid workers or salaried workers. Hourly paid workers are paid their hourly pay rate times the number of hours worked. Salaried workers are payed their regular salary plus any bonus they may have earned. The program should declare two structures for the following data:• Hourly Paid◦ HoursWorked◦ HourlyRate• Salaried◦ Salary◦ BonusThe program should also declare a structure with two members. Each member should be a structure variable: one for the...

What are some key components of the New Deal that affected the relationship between workers and their employers?

The Equal Pay Act of 1963 prohibited employers from paying different wages to workers who performed...

The Equal Pay Act of 1963 prohibited employers from paying different wages to workers who performed the same work but differed by gender. There were for exceptions to this standard. List the four exceptions and provide a contemporary example of each.

Question