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The Process of Determining a Cost- Effective Pay Structure That

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The process of determining a cost- effective pay structure that will attract and retain competent employees, provide an incentive for them to work hard, and ensure that pay levels will be perceived as fair is known as


Definitions:

Employment Contract

A legally binding agreement between an employer and an employee that outlines the terms and conditions of employment.

Fourfold Test

A test for employment based upon ownership of tools, control, chance of profit, and risk of loss.

Risk of Profit

The possibility of encountering losses or gains in financial investments due to market fluctuations.

Control

The power or authority to manage, direct, or govern individuals, organizations, or systems.

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