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5HR03 – Reward for Performance and Contribution
- This document will help you to answer all Learning Outcomes.
- The Assessment criteria, command verbs and indicative content are provided in the grey boxes for information only, whereas the righthand column provides you with more definitive aspects we would expect to see in your answers.
- Always try to apply/use current workplace examples to demonstrate your knowledge.
- 3900 Words plus or minus 10%
- Allow more wordcount for the higher-level command verbs such as: Evaluate and Assess.
Learning Outcome 1: Understand the impact of reward approaches and packages.
1.1 Explain the principles of reward and its importance to organisational culture and performance management.
Command verb – Explain
make something clear or easy to understand, by describing or giving information about it including not only what but why or how.
Indicative content:
Principles of reward: the total reward approach, intrinsic and extrinsic rewards; fairness, consistency and transparency, promoting a culture of trust, balancing internal fairness with external market rates; integrating reward with business objectives; implementing reward policies and practices; role of reward in good work; related legislation and its application.
Importance to organisational culture and performance management:
reward strategies that support the organisational culture and values; recognising and rewarding performance; stimulating performance by rewarding for value created; engaging employees to drive Performance.
Explain the principles of reward, ensure you include the following;
- The total reward approach
- Intrinsic and extrinsic rewards
- Fairness, consistency and transparency
- Promoting a culture of trust
- Balancing internal fairness with external market rates
- Integrating reward with business objectives
- Related legislation and its application.
Explain the importance of those principles to organisational culture and performance management:
- Reward strategies that support the organisational culture and values
- Recognising and rewarding performance
- Stimulating performance by rewarding for value created
- Engaging employees to drive Performance.
Bring in examples from your own organisation or one that you know well to support your answer further.
1.2 Assess the contribution of extrinsic and intrinsic rewards to improving employee contribution and sustained organisational performance.
Command verb – Assess
Judge the importance of.
Indicative content:
Measurement, equity, expectancy, teamworking, intrinsic orientation, senior management support, impact on motivation and results; linking behaviours and achievement measures directly to rewards.
Explain the concepts of extrinsic and intrinsic rewards citing some examples.
You must then assess how these can improve employee performance and help in sustaining organisational performance using 2 motivation theoretical models to support such as Adams Equity theory and Vroom Expectancy theory.
You are required to make a reasoned judgement.
Bring in examples from your own organisation or one that you know well to support your answer further.
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Learning Outcome 2: Understand the importance of different components of reward.
2.1 Explain differences between types of grade and pay structures.
Command verb – Explain
Make something clear or easy to understand, by describing or giving information about it including not only what but why or how.
Indicative content:
Formal and informal structures; types of formal structures such as multi-graded structure, broad-graded, broad-banded, job families; informal structures such as spot rates and individual job grades.
Explain the difference between a formal and informal pay structure.
Explain all of the following types of formal pay structures:
- Multi-graded structure
- Broad-graded
- Broad-banded
- Job families
Explain all of the following types of informal pay structures:
- Spot rates
- Individual job grades
Bring in examples of the type of pay structure in your own organisation or one that you know well to support your answer further.
2.2 Explain how contingent rewards can impact individual, team and organisational performance.
Command verb – Explain
Make something clear or easy to understand, by describing or giving information about it including not only what but why or how.
Indicative content:
Types of contingent pay such as performance-related pay, competency related pay, contribution-related pay, skill-based pay, service/tenure related pay.
Impact on individual, team and organisational performance.
Explain types of contingent rewards such as:
- Performance-related pay
- Competency related pay
- Contribution-related pay
- Skill-based pay
- Service/tenure related pay
Explain what impact these have on:
- Individual performance
- Team performance
- Organisational performance
Bring in examples from your own organisation or one that you know well to support your answer further.
2.3 Explain the merits of different types of benefits offered by organisations.
Explain the merits of an organisation offering a range of benefits.
Command verb – Explain
Make something clear or easy to understand, by describing or giving information about it including not only what but why or how.
Indicative content:
Types of benefits offered and merits of each: types of benefits such as performance-related pay; profit-sharing; gain-sharing; share ownership; payment by results; bonus schemes; commission; pensions; healthcare; insurance cover; sick pay; enhanced redundancy pay; career counselling; company loans; season ticket loans; company cars; concierge services; fees to professional bodies; enhanced maternity; paternity and adoption leave and pay; childcare; sports and social facilities, etc; flexible benefits; impact of reward costs and ability of organisation to resource these costs; development of budgets and resource recommendations.
Individual differences in what is important in their reward; merits of each type of benefit: general merits include increased employee engagement, motivation and commitment to the organisation, reduced churn, helps to attract employees to the organisation.
Choose four different benefits offered by your organisation or one that you know well, explain what they are and then comment on the merits of each benefit.
2.4 Explain the merits of different types of recognition schemes offered by organisations.
Command verb – Explain
Make something clear or easy to understand, by describing or giving information about it including not only what but why or how.
Indicative content:
Differences between formal and informal recognition; day-to-day recognition; public recognition; cash awards; value of cash awards; non-cash awards such as gifts, vouchers, tickets.
Explain what the differences are between informal and formal recognition.
Choose two different types of recognition schemes offered by your organisation or one that you know well, explain what they are and then comment on the merits of each.
You could choose from:
- Day-to-day recognition
- Public recognition
- Cash awards and the value of cash awards
- Non-cash awards such as gifts, vouchers, tickets.
Learning Outcome 3: Understand how to develop insight from benchmarking data to inform reward approaches.
3.1 Assess the business context of the reward environment.
Command verb – Assess
Judge the importance of.
Indicative content:
Context of the reward environment: levels of business activity and confidence; economic outlook; industrial trends and sector profiles including common reward packages – private, public and voluntary; equality legislation; regional differences in pay; occupational classification, labour force trends, pay reviews and pay trends; international comparisons, legal frameworks and cultural drivers.
Internal and external factors: for example, labour market, human capital, efficiency wage and agency; the psychological contract, expectancy and equity; collective bargaining and pay determination; development of pay determination; the increasing regulation of pay; competitiveness; external and internal equity.
Describe the context of the current general reward environment.
Using a recognised tool such as PESTLE/STEEPLE or SWOT Analysis complete an assessment of factors affecting the reward environment. (Include your PESTLE/STEEPLE or SWOT as an image after your references at the end of the submission template).
Choose two internal and two external factors that have an impact on the reward environment from your PESTLE/STEEPLE or SWOT analysis and elaborate on how they are affecting your organisation or one that you know well.
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3.2 Evaluate the most appropriate ways in which benchmarking data can be gathered and measured to develop insight.
Key word – Review
Survey information, methods, outcomes, conclusions, after the event, deciding what was effective or not.
Indicative content:
Evaluate the advantages and disadvantages of at least three different ways in which benchmarking data can be gathered and measured.
You should also clarify how this insight can assist the business in determining reward decisions by commenting on the reliability and applicability for each method.
You could use a tabular format:
| Method | How it can determine reward decisions | Advantages | Disadvantages |
|---|---|---|---|
| Reward and Salary surveys | |||
| Office of national statistics data | |||
| Government data | |||
| CIPD surveys | |||
| Job boards | |||
| Internal data such as payroll, exit interview, retention |
Bring in examples from your own organisation or one that you know well to support your answer further.
3.3 Explain approaches to job evaluation.
Command verb – Explain
Make something clear or easy to understand, by describing or giving information about it including not only what but why or how.
Indicative content:
Differences between formal and informal approaches; differences between analytical and non-analytical job evaluation; point factors; job matching; levelling; use in equal pay defences.
Explain what job evaluation is and why/when it should be carried out.
Explain formal analytical job evaluation approaches:
- Points factor ratings
- Job matching
- Factor comparison
Explain informal non-analytical job evaluation approaches:
- Non-analytical matching
- Job ranking
- Paired comparison ranking
- Internal benchmarking
- Market pricing
Bring in examples from your own organisation or one that you know well to support your answer further.
3.4 Explain the legislative requirements that impact reward practice.
Command verb – Explain
Make something clear or easy to understand, by describing or giving information about it including not only what but why or how.
Indicative content:
Equal pay and reward; minimum pay; itemised pay statements; income tax; reporting requirements such as gender pay gap, CEO pay ratios, annual reports.
Referring to current UK legislation, explain at least three different areas of law and regulation that impact on reward practices.
Examples could include:
- Equal Pay Act
- National Minimum Wage
- Itemised Pay statement
- Income Tax
- Reporting requirements of: Gender Pay Gap, CEO Pay Ratios, Annual Reports
Bring in examples from your own organisation or one that you know well to support your answer further.
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