The Disadvantages of Profit Sharing Include All of the Following

question 19

Multiple Choice

The disadvantages of profit sharing include all of the following EXCEPT that

• A)payments may lose their motivational value as they are made only once a year.
• B)plans may not pay off for several years in a row.
• C)effective profit sharing plans require a second HR program.
• D)employee morale could drop during time periods after no bonus has been given.

---

Definitions:

Profit Sharing

An employee benefit scheme where a portion of a company's profits is distributed to the employees, strengthening their investment in the company's success.

Pay-for-Knowledge

A compensation strategy that rewards employees for acquiring and utilizing additional skills or knowledge that contribute to their job performance and organizational success.

Job Evaluation

The process of determining the relative value and importance of jobs within an organization to establish fair compensation levels.

Base Pay

The initial rate of compensation an employee receives, not including overtime, bonuses, or other additional payments.