Unit Aims and Outcomes
About This Unit
This unit assessment considers the role of strategic reward in attracting, motivating and retaining people at work in order to direct the actions and behaviours of individuals, teams and the organisation towards the achievement of organisational goals. Different financial and non-financial benefits will be applicable depending on the organisational context, but these must always be fair and equitable. The
unit contains the elements required to design, introduce, manage and evaluate effective and fair reward strategies and how the associated policies and practices link and impact on other people practices.
Unit Credits: 15
Guided Learning Hours (GLH): 30 hours
Additional Learning Time: 150 hours
Version: (23)
Guided learning hours represent viewing recordings, attending live sessions, completing your eLearning, and support from tutors. Additional learning time includes self-study, research and assessment preparation and completion.
What You Will Learn
You will develop an understanding of the key factors that influence the design of reward policy. Understanding of organisational strategy and variables is key and you will critically justify the value of benchmarking and reward strategy choices. You will develop indepth understanding of the total rewards approach and the impact of base and incremental pay and benefits in attracting and
motivating employees. You will assess the benefits and challenges of performance appraisal and its links to pay progression. Finally, you will examine the ethical issues that may arise from forms of reward and how the principles of transparency and equity are the cornerstones of responsible and effective approaches to reward.
| LO | AC | Assessment Criteria | Assessment Question | Indicative content | Guidance |
|---|---|---|---|---|---|
| 1 | 1.2 | Discuss the importance of aligning the reward framework to the wider organisational context and strategy. | Q1 Drawing upon specific examples, discuss how the components of a reward strategy can vertically align with the organisation’s strategy and horizontally align with other people practices within an organisation. | Achieving vertical fit between reward strategy and organisational strategy; achieving horizontal fit with people practices, for example recruitment and selection; training and development; performance management, talent management and succession planning processes; examples of strategy and policy; measures of effectiveness; internal factors influencing design of reward strategy and policy, for example organisational size; sector; culture; structure; location; workforce characteristics; profitability; trade union recognition; HR capacity to maintain reward systems. | Answers must demonstrate an understanding of vertical and horizontal alignment. Briefly identify the difference between horizontal and vertical alignment. Examples must be included and could be drawn from your own organisation. Focus on the components of the reward strategy rather than the strategy as a whole. Discuss at least two components of the reward strategy. Explain how the components can align vertically with the organisation’s strategy and horizontally with another people practice(s). Use the Indicative contents for AC 1.2 as guidance. This answer can focus on own organisation or one you are familiar with. Command Verb Discuss = Give a detailed account including a range of views or opinions, which include contrasting perspectives. |
| 2 | 2.3 | Analyse a range of contingent pay schemes, including the advantages and disadvantages for organisations. | Q2 Critically evaluate one individual and one team/company-wide contingency-based pay scheme for the organisation and the employee. | The increase in ‘new pay’ approaches and associated forms of contingent pay; advantages for employers; benefits for employees; consolidated and nonconsolidated forms of contingent pay; team rewards; individual performance-related pay; competence-related pay; contribution-based pay; skills-based pay; organisation-wide reward schemes, for example profitsharing; gain-sharing; share options; advantages and disadvantages of contingent forms of reward; rationale for use; cost benefits, performance gains. | Answers must demonstrate understanding of contingency-based pay schemes. Explain the concept of contingency-based pay schemes. Critically evaluate one individual and one team/company contingency-based pay scheme. Use the Indicative contents for AC 2.3 as guidance. Examine the strengths and weaknesses of the pay schemes for the employee and the employer. Command Verbs Critically = Typically used to qualify verbs such as evaluate, assess, appraise, analyse and reflect. Give in-depth insight, opinion, debate, verdict based on a wide variety of sources, theory, research which may agree and contradict an argument. Evaluate = Consider the strengths and weaknesses, arguments for and against and/or similarities and differences. The writer should then judge the evidence from the different perspectives and make a valid conclusion or reasoned judgement. Apply current research or theories to support the evaluation when applicable. |
| 3 | 3.3 | Assess the benefits and challenges of using performance appraisal to guide pay progression decisions. | Q3 Argue the case for and against using performance appraisals in the formulation of pay progression decisions. | Purpose of appraisal (judgemental, developmental), methods of performance appraisal, role of the line manager in appraisals; role of the appraisee; objective setting (SMART); determining performance ratings; bias in appraisals (primacy/ recency, halo/horns, ‘like me’ effects, unconscious bias), pay budget; distribution curve; consolidated and nonconsolidated awards. | Answers must explain the purpose of a performance appraisal and the process of pay progression. Assess the benefits and challenges of using performance appraisals as a basis for making pay progression decisions. Use the Indicative contents for AC 3.3 as guidance. Consider the positives and negatives. Then make a judgement as to the appropriateness of this method in determining the pay progression decision supporting your work with relevant referencing. Command Verb Assess = Provide a reasoned judgement or rationale of the standard, quality, value or importance of something, informed by relevant facts/rationale. |
| 4 | 4.2 | Critically evaluate the role job evaluation plays in formulating reward decisions. | Q4 Critically review the advantages and disadvantages of using different forms of job evaluation to help determine reward decisions. | Analytical and non-analytical forms of job evaluation; paired comparison; job ranking; job classification; factor comparison, factor rating; proprietary brands of job evaluation; job evaluation in practice; maintaining objectivity; job evaluation panel composition; verifying key documentation, for example job description; job diaries and other forms of job analysis; job evaluation appeals. | Answers must consider two forms of job evaluation. Critically evaluate the strengths and weaknesses of two different forms of job evaluation. Use the Indicative contents for AC 4.2 as guidance. Describe how these forms of job evaluation help determine reward decisions based on those strengths and weaknesses. Command Verbs Critically = Typically used to qualify verbs such as evaluate, assess, appraise, analyse and reflect. Give in-depth insight, opinion, debate, verdict based on a wide variety of sources, theory, research which may agree and contradict an argument. Evaluate = Consider the strengths and weaknesses, arguments for and against and/or similarities and differences. The writer should then judge the evidence from the different perspectives and make a valid conclusion or reasoned judgement. Apply current research or theories to support the evaluation when applicable. |
