Background:
Gwen Best started her own travel agency, Uplifter Travel, in 2010 in her hometown of Brockton Massachusetts. Her business plan targeted major employers as her customer base. She launched her business on the idea that she could serve these employers by booking low-cost, escorted charters to exotic destinations for their employees as part of an employee-paid, but employer-subsidized, vacation package. She then sold her travel services to employers as a unique, low cost employee benefit. From this point on, she expanded her business into other specialty travel lines, to include incentive award travel programs and executive luxury vacation packages. This business now is recognized as the industry leader in specialty travel services in Massachusetts, and it is in the early stages of expansion to other parts of the country. Just like all entrepreneurs, Gwen had a tough time in the beginning of opening her business. She relied on friend contacts to spread the work for her early business, and on financial and moral supports from her family. She also ended up bringing family members into key management positions as her business started to take off.
Problem: After doing a survey on employee’s satisfaction with the company, one of the biggest problems identified was the perceived unhappiness regarding the salaries being paid to persons working different jobs. Employees’ written comments suggested that pay was unfairly administered, that one’s pay depended upon who you knew, and that nobody could explain why some people who did similar work were paid so differently.
1.Determine the job evaluation point value for each job and record that information in Table 2 of your spreadsheet. Then create an XY graph with salaries placed on the Y axis and job evaluation points on the X axis so you can “see” the existing salary structure of the Uplifter jobs based on your job based pay structure (point-factor) system.
2. Develop a job classification (use four to nine categories of job grades) based on the assigned job evaluation points. If you choose to implement job banding or broad banding then choose fewer job grades than nine categories. Group together those jobs you believe should receive similar salaries (and hence, similar job worth scores). Explain your justification for placing jobs in their respective positions.
3. Nathany Campos
| Occupation: | What it’s being paid
(Table 4): |
What it should be paid
(Table 3): |
BLS DATA: | % being paid by Gwen Best: |
| BookKeeper | $26,496 | $35,496 | $45,110 | She’s paying about 58.74% of the market. |
| Customer Service-Travelers | $38,000 | $38,000 | $35,930 | She’s paying about 5% more than what the market pays. |
| Marketing Research- Consumers | $48,104 | $78,104 | $71,090 | She’s paying about 67.67% of the market. |
| HR Managers | $38,698 | $55,698 | $120,750 | She’s paying about 32.04% of the market. |
| Travel Agent | $43,500 | $45,500 | $40,290 | She’s paying about 8% more than what the market pays. |
- Bookkeeper – Based on my observations and the job evaluation that I did on the annual earnings for the Bookkeepers at Uplifter Travel, I have found that Gwen is in her budget of paying 50%-75% of the market to her Bookkeepers. She is now paying about 58.74% to her Bookkeepers, which is just about a little over her minimum (which is 50%) to this occupation. However, the question that pops up now is “why pay just a little over the minimum when she could pay more and still stay within her budget?”. By the fact that all her Bookkeepers are female, gender may be playing a big role in the internal equity problems at her company. Also, this occupation is about 50% minority.
- Customer Service-Travelers – Based on my observations and job evaluation that i did on the annual earnings for the Customer Service-Travelers at Uplifter Travel, I have found that Gwen is paying about 5% more annually to this occupation at her company than the market pays. Therefore, if she wants to stay within her budget of paying 50%-75% of the market she will have to cut down on her Customer Service-Travelers employees annually earnings. The Customer Service-Travelers at Uplifters are 70% female, and only 20% minority. Therefore, minority seems to be playing a big role in the internal equity problems if you compared this occupation annual pay with the previous one.
- Marketing Research-Consumers – Based on my observations and job evaluation that I did on the annual earnings for the Marketing Research employees at Uplifter, I have found that Gwen is paying about 67.67% of the market to her employees at this occupation. She is within her budget regarding this occupation. By paying 67.67% of the market to her Marketing Research-Consumers employees shows that she is fairly paying them, because it’s not her minimum budget nor her highest. It is a pretty fairly pay at this percentage. However, all of her employees at this position are male and are at 0% minority. So, it raises the question: Is it gender and minority playing a big role on determining who deserves more and who doesn’t at Uplifter?
- HR Managers – Based on my observations and job evaluation that I did on the annual earnings for HR Managers at Uplifter, I have found that Gwen is paying about 17.96% under what the market pays for this occupation. Her only HR Manager is a female and is at 0% minority. Gwen is significantly under paying her HR Manager compared to what the market pays at MA. There fact that her HR Manager is the only one at this occupation at her company, I don’t think minority would matter yet gender can be regarding the unfairly pay.
- Travel Agent – Based on my observations and job evaluation that I did on the annual earnings for Travel Agent at Uplifter, I have found that her Travel Agents are being paid at 8% more than what the market pays for this position at MA. All of her Travel Agents are female, and are at 0% minority. Therefore, Gwen is paying all of her female employees at this occupation (who are not a minority) annual salaries that are above her budget of paying only 50%-75% of the market. She will have to cut down her Travel Agents annual salaries if she wants to stay within her budget.
- Real and potential internal equity problems:
- Gender does plays a big role in the inequality pay at Uplifter. The two occupations that Gwen is paying within her budgets are Market Research – Consumers and Bookkeepers. However, she is running just a little over her minimum of 50% when paying all of her Bookkeeper whereas when paying her Market Research Consumers, she’s running at a pretty fair percentage of 67.67%. All of her Bookkeepers are women and her Market Researchers are males. This can be seen as a gender discrimination because she is paying fairly more to her make employees to what she is to her female employees considering to what the market pays.
- Minority is also playing a role in the inequality pay at Uplifter. The reason why is because Gwen is overpaying her employees at two different occupations compared to what the market pays. Her Customer Service-Travelers and her Travel Agent are earning at about 5% and 8% more than what MA market pays for these positions a year. Even though women are a majority at these positions, minority is considered to be pretty low within these occupations. Therefore, minority is playing a big role at the inequality pay at Uplifter, because when minority is low the annual pay is high or even exceeds the market pay.
- The only exception regarding minority at Uplifter annual pay is for HR Manager, who runs at 0% minority and still gets pay annually way less than what the position deserves to be paid at the state. Her only HR Manager is a female who gets paid about 17.96% under what the market pays for this position in the state of MA. Again, the issue of gender comes along raises the question of females always gets paid less than men at Uplifter compared to what the market pays.
4.Suggest solutions to each of the problems you identify. Be specific. If you suggest changes in salaries, be sure to compute a revised total salary budget that reflects the changes you recommend. What are the changes in the annual salary budget based on changes you recommend? If the budget increases, how will you meet it?
Note: Answer question according to question 3
