A pay difference between newly hired employees and experienced employees in similar jobs becomes very small. This situation is known as:
Correct answer: D. Pay compression
- A. Broadbanding
- B. Internal recruitment
- C. Wage garnishment
- D. Pay compression
Explanation
Pay compression occurs when differences in pay between groups, such as new and experienced employees, become unreasonably narrow. Broadbanding combines several pay grades into wider ranges and is a different compensation practice.
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About Human Resource Management
Human resource management deals with acquiring, developing, rewarding and retaining employees within an organisation. It includes job analysis, recruitment, selection, training, performance appraisal, compensation, career planning, labour relations and workplace discipline. Recruitment attracts applicants, while selection evaluates them and chooses the most suitable candidate.
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