A Problem with the Hay System of Compensating Workers Is

question 208

Multiple Choice

A problem with the Hay system of compensating workers is that:

• A) because it is relatively new, most workers and managers are unfamiliar with it.
• B) the EEOC has declared it illegal because it discriminates against older workers.
• C) it is difficult and expensive to administer because of the extensive paperwork needed to compute wages and salaries each pay period.
• D) it can lead to resentment because more productive employees may earn less than employees who do not perform as well but have worked for the company longer.

---

Definitions:

Knowledge

Information, understanding, or skill that one gets from experience or education.

Skills

Specific abilities or competencies that individuals possess or acquire, which enable them to perform tasks effectively.

Firm-Specific Human Capital

The unique knowledge, skills, and abilities employees develop that are valuable to a particular organization but not necessarily transferable.

Generic Human Capital

Refers to the broad and universally applicable skills, knowledge, and experience that individuals possess, which can be transferred and applied across various industries and roles.