4. Salaries and bonuses are ________ compensation types..

a. Indirect c. Nonfinancial
b. Direct d. Advances
5. The _________ purpose of performance evaluation are used
for decision-making related to promotions, transfers, and
terminations. Republic of the Philippines
a. administrative c. motivational Department of Education
b. developmental d. appraisal Region III
6. ___________ are all forms of pay given by employees to their Schools Division Office of Bulacan
employees for the performance of their jobs. LAURA DE LEON HALILI HIGH SCHOOL
Pulong Sampaloc, Doña Remedios Trinidad, Bulacan
a. compensation/wages c. piecework basis
b. equity d. monthly basis
7. A method designed to find out if the employee possesses
important work characteristics.
a. BOS c. Trait Method ORGANIZATION AND MANAGEMENT
b. Graphic rating scale d. BARS
8. A method that measures the frequency of observed behavior. Compensation, Wages and Performance
a. Force-choice method
b. Trait method
c. Behavior observation scale
d Graphic rating scales.
Evaluation
9. _________ is when pay is computed according to the number Second Quarter
of work days rendered. Module 4
a. piecework b. daily c. weekly d. monthly
10. The ________ purpose of performance evaluation are used
to provide information about employees’ performace and their
strengths and weaknesses.
a. administrative c. motivational
b. developmental d. appraisal ACTIVITY SHEET
Enrichment Activities
Do you agree with the statement that the evaluator’s bias may
cause evaluation programs to fail? Explain your answer.
NAME: __________________________________
References:
Helena Ma. F. Cabrera, H. F., Altarejos, A. D.C., Benjamin, R. GRADE AND SECTION: __________________________________
(2016). Organization and Management Textbook for Senior High
School. Quezon City: Vibal Group Inc. DATE OF SUBMISSION: __________________________________

(Page 1)
2(Page 14)
I. OBJECTIVES
A. Content Standards:
The learners demonstrate an understanding of the process
of recruiting, selecting, and training employees.

B. Performance Standards:
The learners shall be able to conduct and prepare job
analysis.

C. MELCs:
Examine the functions and importance of compensation,
wages and performance evaluation, appraisal, reward
system, employee relations and movement.

D. Specific Objectives:
1. identify the policy guidelines on compensation and wages
and performance evaluation or appraisal;
2. discuss the types of compensation and bases for
compensation;
3. cite the different appraisal methods and the purposes of
performance Evaluation

CONTENT: Chapter 5: Staffing

Lesson 5: Compensation/Wages and Performance
Evaluation

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IV. REFLECTION III. PROCEDURES:
From the module of Organization and Management, I learned A. Preliminary Activities
that.... 1. Pre-Test

MULTIPLE CHOICE. Read the following items carefully. Write your

_______________________________________________________________ answer before the number.
_______________________________________________________________ ____1. This refers to all forms of pay given by employers to their
_______________________________________________________________ employees for the performance of their jobs.

______________________________________________________ A. Performance Evaluation C. Pay equity

B. Compensation/Wages D. Appraisal
V. ASSESSMENT (Post Test)
____2. Theory of motivation which predicts that employees are
Directions: Read each questions carefully and choose the letter of motivated to work well because of the attractiveness of the rewards
the best answer. Write your answer before the number. or benefits that they may receive from a job assignment.
A. Pay Equity Theory C. Expectancy Theory
_____ 1. This refers to the performance evaluation method that B. Job Design Theory D. Reinforcement Theory
requires the rater to choose from two statements designed to
distinguish between positive or negative performance. ___3. Which of the following is the external factor that influenced
A. Trait Methods C. Behavior Observation Scale
compensation rate?
B. Forced-choice Method D. Graphic Rating Scale
A. Organization’s compensation policies
_____ 2. Which of the following is the reason why some evaluation B. Employer’s financial stability
programs fail? C. Area/Regional Wage Rates
A. Healthy personality of the evaluator D. Employees’ qualifications in meeting the job
B. Adequate time for answering the evaluation forms requirements
C. Adequate orientation of the evaluates regarding the ____4. An employee compensation calculate on weekly,
objectives of the program monthly, or annual basis.
D. Bias exhibited by evaluators
_____ 3. Pay is computed according to the number of work hours A. Bonus C. Separation Pay
rendered. B. Salary D. Wages
a. hourly b. daily c. weekly d. monthly

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(Pre-Test)
6. Performance evaluations done by companies never fail.
_____5. This includes worker’s salaries, incentive pays, 7. Employees feel that their salary must be commensurate to the
bonuses, and commissions. efforts they exerted in the performance of their job.
8. Wage experts, now, prepare compensation packages that create
A. Nonfinancial Compensation C. Equity
value for both the organization and its employees.
B. Indirect Compensation D. Direct Compensation 9. Expectancy Theory is another motivation theory which predicts
that employees work well because of the attractiveness of the
____6. This refers to the process of undertaken by the rewards or benefits that they may possibly receive from a job
organization, usually done once a year, designed to assignment.
measure employees’ work performance. 10. Equity Theory is a motivation theory which focuses on
A. Pay Equity Theory C. Performance Evaluation employees’ response to the pay that they receive, to the feeling that
B. Forced-choice Method D. BOS Approach they receive salaries commensurate to their efforts exerted in the
performance of their job.
____7. This refers to the performance evaluation method
designed to find out if the employee possesses important
work characteristics. ACTIVITY C: (Written Work / Task)
A. Graphic rating scale C. Forced-choice Method
B. Behavioral observation scale D. Trait Methods Answer the following questions:
___ 8. An employee compensation based on the number of
1. Name the different compensation types. Briefly define each.
hours worked or amount of output produced. 2. Give at least five reasons why some evaluation programs
A. Salary C. Bonus fail?
B. Wages D. Cash Advance
___ 9. It also refers to all monetary payments and all goods or
commodities used in lieu of money to reward employees.
A. Cash Advance C. Separation Pay
B. Bonus D. Compensation

___ 10. Refers to the process of observing and evaluating an

employee’s performance, recording the assessment, and providing
feedback to the employee.
A.Performance Appraisal C. Staffing
B.Promotion D. Directing

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C. Independent Activities (Formative) 2. Reviewing Previous Lesson
Selection is the process of choosing individuals who have the
ACTIVITY A: (Written Work / Task) required qualifications to fill present and expected job openings.
Write the letter of the correct answer. Choose your answer from The selection process typically includes the following steps:
the words listed on the box. 1. Establishing the selection criteria
2. Requesting applicants to complete the application form
3. Screening by listing applicants who seem to meet the set
criteria
4. Screening interview to identify more promising applicants
1. When pay is computed according to the number of units 5. Interview by the superior/manager or panel interviewers
produced 6. Verifying information provided by the applicant
2. When pay is computed according to the number of work 7. Requesting the applicant to undergo psychological and
days rendered physical examination
3. When pay is computed according to the number of work 8. Informing the applicant that he or she has been chosen for
moths rendered the position applied for
4. When pay is computed according to the number of work Types of Job Interviews
hours rendered 1. Structured interview 3. One-on-one interview
5. When pay is computed according to the number of work 2. Unstructured interview 4. One-on-one interview
weeks rendered.
Training and Development
ACTIVITY B: (Written Work / Task) The typical scope of training covers the following procedures:
TRUE OR FALSE: Write T if the statement is CORRECT and F if 1. Conducting the Training Needs Assessment
INCORRECT. 2. Designing the Training Program
1. Compensation/Wages are all forms of pay given by 3. Implementing the Training Program
employees to their employees for the performance of their 4. Evaluate the Training
jobs.
2. Performance Evaluation is a process done, usually once a year, to B. Presenting the New Lesson
measure the work’s performance.. 1. Activity: Motivation
3. Indirect refers to salaries, incentive pays, bonuses and Before we proceed, what word can you associate with the words
commissions. “Compensation” and “Performance”. Write your answer in the
4. Compensation bases include piecework, hourly, daily, concept map.
weekly, and monthly basis. ANALYSIS:
5. Developmental purpose of performance evaluation is used Processing questions:
as basis for decisions related to compensation, promotions, A. Why do you think these words can be associated with
transfers and terminations. Compensation and Performance?

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3. ABSTRACTION (Discussion of the Topic)
Why Some Evaluation Program Fail
Compensation/wages and performance evaluation are related to
each because the employees’ excellent or poor performance also Performance appraisals (such as manager/supervisor
determines the compensation given to them, after considering other
appraisal, self-appraisal, subordinate appraisal, customer
internal and external factors like the actual worth of job,
appraisal, team appraisal, or 360-degree appraisal) may sometimes
compensation strategy of the organization, conditions of the labor
market, cost of living, and area wage rates, among others. fail due to various reasons including the following:

Types of Compensation  Inadequate orientation of the evaluates regarding the

1. Direct Compensation – include worker’s salaries, incentive objectives of the program
pays, bonuses, and commissions  Incomplete cooperation of the evaluates (e.g. proper
2. Indirect Compensation – includes benefits given by answering of evaluation questionnaire)
employers other than financial remunerations, for example:
 Bias exhibited by evaluators
travel, educational and health benefits, and others.
3. Nonfinancial compensation – includes recognition  Inadequate time for answering the evaluation forms
programs, being assigned to do rewarding jobs, or enjoying  Ambiguous language used in the evaluation questionnaire
management support, ideal work environment, and  Employees’ job description is not properly evaluated by the
convenient work hours. evaluation questionnaire used
 Inflated ratings resulting from evaluator’s avoidance of giving
Compensation: A Motivational Factor for Employees low scores
Compensation pay represents a reward that an employee
 Evaluator’s appraisal is focused on the personality of the
receives for good performance that contributes to the company’s
success; in relation to this, the following must be considered: evaluate and not his or her performance
 Unhealthy personality of the evaluator
Pay Equity – related to fairness; the Equity Theory is a  Evaluator may be influenced by organizational politics
motivation theory focusing on employees’ response to the pay that
they receive and the feeling that they receive less or more than they
deserve.
Expectancy Theory – another theory of motivation which
predicts that employees are motivated to work well because of the
attractiveness of the rewards or benefits that they may possibly
receive from a job assignment.

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 Developmental Purposes – are fulfilled through
appraisal/evaluation programs that provide information about
employees’ performance and their strengths and weaknesses that
may be used as basis for identifying their training and development
needs.
Performance Appraisal Methods
Methods of evaluating workers have undergone development in
order to adapt new legal employment requirements and technical
changes.
Some appraisal methods in use today are the following:
Trait methods – performance evaluation method designed
to find out if the employee possesses important work
characteristics such as conscientiousness, creativity, emotional
stability, and others.
Graphic rating scales – performance appraisal method
where each characteristics to be evaluated is represented by a scale
on which the evaluator or rater indicates the degree to which an
employee possesses that characteristics.
Forced-choice method – performance evaluation that
requires the rater to choose from two statements purposely
designed to distinguish between positive or negative performance;
for example: works seriously- works fast; shows leadership-has
initiative.
Behaviorally anchored rating scale (BARS) – a behavioral
approach to performance appraisal that includes five to ten vertical
scales, one for each important strategy for doing the job and
numbered according to its importance
Behavior observation scale (BOS) – a behavioral approach
to performance appraisal that measures the frequency of observed
behavior.
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3. ABSTRACTION (Discussion of the Topic)
Bases for Compensation
Employees may be compensated on the following bases:
Piecework Basis – when pay is computed according to the
number of units produced
Hourly Basis – when pay is computed according to the
number of work hours rendered
Daily Basis - when pay is computed according to the number
of work days rendered
Weekly Basis - when pay is computed according to the
number of work weeks rendered
Mnthly Basis – when pay is computed according to the
number of work months rendered
Compensation rates are influenced by internal and external
factors. Among the internal factors are the organizations’
compensation policies, the importance of the job, the employees’
qualifications in meeting the job requirements, and the employer’s
financial stability.
External factors, on the other hand, include local and global
market conditions, labor supply, area/regional wage rates, cost of
living, collective bargaining agreements, and national and
international laws, among others.
Purposes of Performance Evaluation:
Improving individual job performance through performance
evaluation is just one of the reasons why employees are subjected
to assessment on a continuous basis. There are other purposes
behind employee assessment that are beneficial to both the
company and the employees, these are:
Administrative Purposes – are fulfilled through
appraisal/evaluation programs that provide information that may
be used as basis for compensation decisions, promotions,
transfers, and terminations. Human resource planning may also
make use of it for recruitment and selection of potential employees.
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