Job Salary Survey Glossary

Salaried - This is the compensation that is received by an employee, weekly, monthly or yearly, as opposed to hourly pay. Typically, this applies to employees of higher levels with non-repetitive jobs that may or may not be supervisory in nature. These positions are exempt from the Fair Labor Standards Act provisions.

Salaried Sales Agents - These sales representatives are actually employees of the insurer and their compensation is typically a combination of a base salary plus commission. Salaried sales agents may work independently or they may work with other agents. They may make direct sales or they may promote the insurer's product by pitching sales to middlemen. Also known as salaried sales representatives.

Salary - This is the fixed wage paid to an employee. The basis is usually weekly, monthly or yearly, and is most often applied to exempt employees.

Salary and Pay Increases - A raise in an employee's salary due to merit, general policy, or cost-of-living increases.

Salary Budget - Money designated over a specific period to pay salaries. When structure adjustments and/or individual employee adjustments are being planned, the salary budget must be taken into consideration.

Salary Continuation Plan - A sick leave and/or disability plan providing for employees to receive up to 100 percent of their salary for a certain amount of time, should they become sick or disabled.

Salary Increase Budget - Salary increase budget represents the difference, which exists, between a company's current pay and the goal it has or where it foresees its pay levels reaching in the future.

Salary Range - Usually used to determine individual employee pay, this term refers to a range of rates, from the minimum to the maximum, for a particular class or grade of employees.

Salary Reduction Plan - Salary reduction plans are ones in which deductions are made from the employees salary prior to the calculation of income for tax purposes. The money thus taken out of the employees current pay is put aside for future purposes. Two important salary reduction plans are: (1) 401(k) PLANS where money is put aside for retirement, and (2) DEPENDENT CARE ASSISTANCE PLANS where money is put aside to pay monthly costs of day care. The employee needs to be careful in how much is put aside since unused amounts may not be returned to the employee.

Salary Structure - Usually established within an organization, this is the levels or hierarchy of job and pay ranges. The salary structure is also referred to as job grades, job-evaluation points and/or policy lines.

Salary Structure Change - This term is employed to describe an adjustment in the structure of salaries, which is stated as the percentage that the total off all middle points of the new salary structure exceed or lag behind that of the old structure.

Salary Survey - Salary surveys are used by organizations to determine what the "market rate" is for jobs or skills used in their organization. Paying a competitive wage is important for attracting and maintaining an adequate workforce. Organizations may do their own surveying, participate in a survey, or purchase survey data. Two issues are paramount in wage surveying and analysis. The first is the accuracy of the data. The second is the comparability of the jobs in the survey to those of the organization. EI's Salary Assessor(r) software provide a compilation of many wage surveys from all over the U.S. analyzed and presented in a way that you can find market rates for most jobs anywhere in the U.S.

Salary-Reduction Plan - This is available in most companies and is a system where the employee has to the option to ask pay-roll to reduce the his or her cash compensation and have the difference contributed to the employee's pension plan, insurance plan or any other benefit plans available to employees.

Sale of Stock - This is the exchange of shares in return for its cash value.

Sales Compensation - This is the amount that is paid to members of the sales team of a company. This amount typically varies according to the degree to which individual representatives attained or surpassed their set goals.

Sales Compensation Plans - Sales compensation plans differ from the other types of compensation plans. Due to the fact that results are measurable in sales related jobs, compensation for those kinds of jobs are typically incentive- (or commission-) based. Compensation plans for sales type jobs may be fall into any of the following categories, Commission only, salary only plans, Commission-plus-draw plans, Salary-plus-commission plans, and or Salary-plus-bonus plans.

Scanlon Plan - This is a profit sharing program whereby employees share in pre-established cost savings, which are due to employee effort. Formal employee participation is necessary with the Scanlon Plan, as well as periodic progress reporting and an incentive formula, all of which are pre-established.

Scheduled Hours - This represents the number of hours that an employee is scheduled to work in a given work period as opposed to the number of hours actually worked.

Scope - A series of quantifiable job characteristics, ascribing value to certain jobs. The most common measures include asset size of the organization, sales volume, number of subordinates and size of the managed budget.

Scope Data - These are particular numbers (usually sales or number of employees) used for selecting appropriate salary survey figures to determine going rates for a job or organization of jobs.

SEC - The Securities and Exchange Commission (SEC) is the principal federal regulatory agency that regulates the securities industry. The main function of the SEC is to promote full disclosure; it exists to protect investors, in the securities market, against practices that are fraudulent and/or manipulative. The SEC enforces several acts, including but not limited to the Securities Act of 1933, the Securities Exchange Act of 1934, the Trust Indenture Act of 1939, the Investment Company Act of 1940 and the Investment Advisers Act.

Sec Management Compensation Reporting - The annual reporting to the Securities and Exchange Commission (SEC) by publicly traded corporations requires the reporting of the annual salary, bonus, and all other payments to the company's five top executive officers. This Summary Compensation Table reports the compensation paid to the executive officers during the last completed fiscal year and the two preceding fiscal years. The table contains two main sub-headings, "annual compensation" and "long-term compensation." Under each heading are three columns. The last column of the table, "all other compensation," which appears without a sub-heading, is a residual column whose components must be identified in a footnote.

Secondary Source of Job Information - This is a term employed in job analysis to describe any source of job related information other than the person whose job is being analyzed and/or his direct supervisor.

Section 3460 - In Canada, Section 3460 of the Canadian Institute of Chartered Accounts (CICA) contain recommendations relating to employer's accounting for obligations and pension costs. The recommendation made by Section 3460 is that, for defined benefit plans, the projected benefit method should be the determinant for pension costs for accounting purposes.

Section 401(K) Plan - In the United States, a deferred profit sharing and/or stock-bonus plan permitting participants to decide the extent to which their compensation is deferred. Contributions of participants are not taxable until that time when the funds are withdrawn. Contributions of sponsor and investment earnings are both also tax-deferred. Also known as CASH OR DEFERRED ARRANGEMENTS (CODA).

Section 403(B) Plan - This is a type of retirement plan, typically established by certain tax-exempt organizations (i.e., charities, churches and hospitals). Section 403(b) plans are a creation of congress to serve as incentive to tax-exempt organizations, which ordinarily would not benefit from the tax advantages of qualified pension plans. The section 403(b) plan enables such organizations to offer their employees retirement compensation, albeit in a slightly different form. Educational organizations may also set up section 403(b) plans. Also may be referred to as a tax-deferred ANNUITY (TDA) plan or a tax-sheltered ANNUITY (TSA) plan.

Section 415 Limits - This the limit imposed on the amount of annual contribution that can be made on the behalf of a participant of a defined contribution plan. There is also a limit placed on the amount of benefits payable to a participant of a defined benefit plan. These limits are set under Section 415 of the Internal Revenue Code. See CONTRIBUTION LIMIT and MAXIMUM BENEFIT.

Section 79 - Section 79 of the Internal Revenue Code provides that employer contributions to purchase company term life policy receive preferential tax treatment. It also lists specifications that a plan is required to meet before being considered a nondiscriminatory organization term insurance plan for tax purposes.

Securities and Exchange Commission (SEC) - The Securities and Exchange Commission (SEC) is the principal federal regulatory agency that regulates the securities industry. The main function of the SEC is to promote full disclosure; it exists to protect investors, in the securities market, against practices that are fraudulent and/or manipulative. The SEC enforces several acts, including but not limited to the Securities Act of 1933, the Securities Exchange Act of 1934, the Trust Indenture Act of 1939, the Investment Company Act of 1940 and the Investment Advisers Act.

Seniority - Determined by the number of years that an employee has worked for a particular employer. Seniority is frequently the basis for benefits and privileges. The term is sometimes used to express the amount of time spent working for a division or in a specific occupation.

Seniority Increases - A raise in an employee's' salary, due to length of time in a particular job.

Severance / Benefits Continuation - This is a term employed to describe the continuation of the salary of an employee after he or she has been terminated. This salary is paid either on a continuation basis or in a lump sum. The amount of the severance is typically contingent upon the length of time the employee served the company.

Severance Pay - In most countries, though not the U.S., SEVERANCE PAY is mandatory any time an employee is terminated. The purpose of SEVERANCE PAY is to soften the blow of unemployment, upon the termination of an employee. Typically, SEVERANCE PAY is equal to one week's pay for each year worked for the severing company (may be more and it may be less).

Shift Differentials - Applies to employees paid on an hourly basis. Hourly employees who are required to work a shift other than their normal shift typically receive differential pay (e.g., $.75 or $1.00) in addition to their hourly rate for the entire period that they are working on that particular shift. Differential pay is most commonly seen where the shift being worked is considered to represent a hardship, or when companies considered competitors offer similar compensation.

Short-Term Disability Income Insurance - This is insurance that provides benefit for both short term and long-term (the first part of long-term) disability.

Short-Term Incentives - Rewards that are based on the achievement of short-term goals (typically 12 months or less).

SIC - Stands for the Standard Industrial Classification System. A U.S. federally designed system, which identifies companies by industry with a standard numbering system. It provides other information and is used by securities analysts, market researchers, and others.

SIC Code - Stands for Standard Industrial Classification code.

Sick Leave - Paid time off. Sick leave means providing pay for employees when not working due to illness or injury. It may start on the first day of illness or after two or three days. In developing a sick leave policy the following points need to be considered: (1) When are employees eligible? (2) Will proof of sickness be required? (3) What pay schedule will be used and will the employee receive full pay? (4) How much sick leave can be accumulated and what is done about unused sick leave? (5) May sick leave be used for taking care of family members?

Sick Pay - Sick Pay is treated as regular pay for tax purposes unless provided through a third party in the form of insurance.

Simple Plan - First allowed in 1997, this is a kind of qualified retirement plan (IRA or 401(k)) for companies with over 100 employees.

Simplified Employee Pension (SEP) - A pension plan towards which an employer may contribute employee retirement income, using individual retirement accounts or individual retirement annuities. Under a salary reduction SEP, employers may contribute amounts deferred by employees directly into INDIVIDUAL RETIREMENT ACCOUNTS (IRAs) set up by or for each employee with a bank, insurance company, or other qualified financial institution.

Skill-Based Pay - This is a compensation system, which is based on the set of skills an employee has and is capable of using should the need arise (even though the employee may not currently be using the skill).

Skills Inventory - Typically used by employment agencies, personnel departments and contract programming companies that wish to set up and maintain a file for candidates and their associated qualifications. Once all the data is in place and information about a potential candidate is entered along with particular job requirements, then a search can be done for the candidate or candidates who meet the requirements.

Sliding-Scale Agreement - In wage determination, a sliding-scale agreement is a contract, typically between a workers union and an employer, in which a variable wage structure is established that sets wage levels depending on a second variable factor such as the cost-of-living index, the employer's' annual budget, or the future profitability of the employer.

Small-Group Incentive - Any incentive plan that focuses primarily on the performance of a small group (typically a work team).

Social Security Level Income Option - Under this option, employees may chose to have monthly ANNUITY payments (before the age of 62 or 65) increased actuarially; thereafter, the payments are decreased.

Special Vocational Preparation (SVP) - The amount of time required by a typical worker to acquire skills for average performance. There are nine levels of time duration required by a typical worker to acquire skills for average performance in the subject position, 9 being the highest and 1 being the lowest. For more information on SVP, please refer to the Dictionary of Occupational Titles or U.S. Department of Labor.

Specified Fringe Benefits - Benefit plans for specific purposes including group-term life, accident and health, group legal services, cafeteria plans, educational assistance programs, and dependent care assistance programs.

Spendable Income - This is the total income minus housing expenses, taxes, savings, and LIFE INSURANCE.

Split Credit - Credit is given to more than one individual.

Standard Occupational Code (SOC) - The SOC is a Canadian system used by statistical agencies to categorize workers into occupational groups so as to collect, calculate, and disseminate data. Workers will be grouped into a particular classification of occupation (of which there are over 820) depending on their definition. To make classification easier, occupations will be combined so as to form 23 main groups, 96 sub-groups and 449 broad categories of occupations.

Standard Rate - Designated rate for a specific job classification, established by evaluation or performance.

Starting Rate - Refers to the wage or salary to which an employee is assigned upon entering the job.

State Disability Insurance Program (SDI) - A plan for accident and sickness, or disability insurance required by state legislation of those employers doing business in that particular state.

Statutory Benefits - Benefits that are required by statutory law. In the United States, for example, Workers'' Compensation, Social Security and Unemployment Insurance are required. Benefits vary among countries. Companies operating in foreign countries must comply with host country compensation and benefits mandates.

Statutory Stock Options - Gives an employee a right to purchase company stock, usually at a bargain price.

Step Rates - A method of calculating benefits by assigning a different value to income below and above a certain breakpoint, such as the Social Security level.

Stock Bonus Plan - A qualified defined contribution plan established and maintained by an employer to provide benefits similar to those of a profit-sharing plan, except that the contributions by the employer are not necessarily dependent upon profits and the benefits are distributable in stock of the employer company. For the purpose of allocating and distributing the stock of the employer that is to be shared among employees or their beneficiaries, such a plan is subject to the same requirements as a profit-sharing plan.

Stock Option Incentive - A special benefit that some companies offer to their employees to purchase stock at a fixed price. Companies usually award incentive stock options as a bonus for performance, or as an incentive to get employees to work harder.

Stock Options - The right to buy company stock at a certain price within a particular period of time. The assumption is that the market price of the stock will be higher than the predetermined price at the time that the person is allowed to purchase the stock.

Stock Ownership - Stock ownership of one or more shares of a corporate stock which entitles the owner to: (1) a proportionate share of the issuing company's' undivided assets, (2) dividends as declared by the board of directors, (3) voting rights, and (4) sometimes, the right to purchase more stock.

Stock Purchase Plan (Non-Qualified) - A plan that allows senior management or other key personnel to purchase employer stock. Certain restrictions apply: (1) the stockholder must be employed for a particular length of time, (2) the employer has the right to buy back the stock and (3) stockholders cannot sell the stock for a specific time period.

Stock Purchase Plan (Qualified) - A program under which employees buy shares in the employer's' stock. The employer contributes a certain amount for each unit of employee contribution. Also, stock may be offered at a fixed price (usually below market) and paid for in full by the employees.

Stock Swap - Allowing an executive to deliver already-owned stock, instead of paying cash, to exercise a stock option.

Strength Rating - The overall physical strength required to perform a job is expressed as a strength rating.

Suggestions Awards - Many companies use suggestion award programs to elicit ideas for improvement from employees. This not only provides the company with new ideas but also gives the employees a voice in the governance of the company. Suggestions are usually reviewed by a committee consisting of managers and workers. Ideas that are accepted and implemented are rewarded with money and recognition. The amounts may vary depending upon the dollar savings of the suggestion. The type of suggestions may vary from improvements in work flow, safety, or organization, to suggestions for new products.

Survivor Income Benefit - A type of group LIFE INSURANCE, which provides income benefits if a ''qualified survivor'' survives the insured. Usually the qualified survivor category includes only the insured's spouse and children.

Take Home Pay - Pay actually received by an employee after adding on bonuses, but deducting taxes.

Target Compensation - Expected pay for a job or position. This would include all avenues of compensation (base pay, incentives, bonuses, etc.).

Target Total Compensation - The complete cash compensation available to sales representative, for achieving sales goals.

Termination of Employment - An employee who terminates his/her employment or is terminated is entitled to retain their health care benefits for a period of time under COBRA. The terminated employee must pay the monthly premiums plus a small processing fee. The employer may choose to cash-out an employee's' retirement benefit upon termination of employment without the employee's' consent when the benefit's present value does not exceed $3,500.

Tiered Pay Plan - A compensation system that distinguishes the salary based on time of hire and work performance.

Time Off with Pay - Holidays, vacation, sick leave, lunch periods, and other approved time off, during which the employee does receive pay.

Time Span of Discretion - A non-economic definition of job value.

Timing of Payment - When payment is received early, current, or deferred.

Total Annual Cash Compensation - The sum of all cash payments made to an individual for services during a given year.

Total Cash Compensation - This figure reflects your total cash compensation including the following elements: 1) Base Pay, 2) Shift Differentials, 3) Hazardous Pay or Danger Pay incentive or differentials, 4) Total annualized overtime pay ,5) Other miscellaneous payments 6) Bonus payments, 7) Profit sharing.

Total Compensation - The sum of all payments made to an employee for a specific time period (usually annual) including base salary, incentives, and bonuses (and/or other variable pay), commissions, and stock options.

Total Covered Payroll - An employee's' total monthly earnings that are covered by a disability insurance policy.

Total Direct Compensation - In executive compensation, total annual cash compensation plus the annualized value of long-term incentives.

Total Payroll - The sum of wages paid at the opening of business on the first day of the plan year or the last day of prior year.

Total Remuneration - The sum of the financial and non financial value to the employee of all the elements in the employment package.

Training Program Wage - Under selected conditions, employers may pay less than the MINIMUM WAGE to young workers who are participating in training programs.

Travel Expense - Travel expenses, such as hotels, taxis, meals, porters, and other incidental costs, are reimbursable to the employee and are not considered income as long as they are reasonable. In order to qualify, the employee must receive reimbursement separate from his/her wage payment.

U.S. Minimum Wage - The lowest wage, determined by law or contract, that an employer may pay an employee for a specified job.

Travel Expense - Travel expenses, such as hotels, taxis, meals, porters, and other incidental costs, are reimbursable to the employee and are not considered income as long as they are reasonable. In order to qualify, the employee must receive reimbursement separate from his/her wage payment.

U.S. Minimum Wage - The lowest wage, determined by law or contract, that an employer may pay an employee for a specified job.

Unemployment Compensation - Payments made under state-administered programs to workers who are unemployed and meet the requirements of the law involved to qualify for such payments. The requirements usually are that the: (1) worker not be unemployed voluntarily; (2) worker has worked in employment that is ''covered'' by the law; (3) worker be willing and able to take employment offered him or her; and (4) initial period (the waiting period) of unemployment elapse before compensation is due. Programs are entirely employer financed, except in four states that require small employee contributions.

Unemployment Insurance - In Canada, a federal statute that provides unemployment insurance to almost all persons who are employed in Canada.

Unexercised Options / Sars - The rights that have not yet been exercised. They may consist of both exercisable (vested) and non-exercisable (non-vested) rights.

Unfunded Commitments To Executives - A non-qualified compensation plan in which future financial commitments have been made to an executive organization. The compensation plan has not been secured with funds that have been set aside for that purpose.

Unreasonable Compensation - A potential tax issue in privately held or closely held companies is executive compensation.

Unscheduled Absence - Any unanticipated time lost from work.

Valuation Date - Designated time of closing (monthly, quarterly, etc.) for determination of account balances in a defined-contribution or defined benefit plan.

Valuation of Benefits - Establishing a value for an employee's' benefits at any one time may be very difficult. Since a number of assumptions need to be made about tenure and life span, it becomes an actuarial calculation. However, organizations needs to calculate this figure for their workforce to determine the possible future costs involved. Valuation of certain benefits, such as private airplane flights or other such things, are subject to special IRS rules.

Variable Pay - Rewards based on performance rather than rewards based on time spent on the job or the value of the job.

Vesting - The process whereby accrued benefits under a plan become non forfeitable to the participant. Any benefits that are a result of employee contributions must always be 100 percent vested from the first day. Benefits resulting from employer contributions must vest at least as rapidly as under one of two statutory schedules: five-year CLIFF VESTING or seven-year GRADED VESTING.

W-2 Form - Wage and Tax Statement.

W-4 Form - The Employee's' Withholding Allowance Certificate.

Wage - The total of salary and also commissions, or bonuses, paid by an employer for services.

Wage and Price Controls - Wages and prices are limited to some low percentage of growth through government regulation, until they are deemed to be under control.

Wage Contour - Developed by labor economist John Dunlop, a way of considering an external wage structure.

Wage Differential - Differences in wage rates due to the location of company, hours of work, working conditions, type of product manufactured, or a variety of other circumstances.

Wage Level - The average of all salaries paid to workers in an occupation or industry.

Wage Movement - A decrease or increase in the wage levels for a particular position or occupation in a market.

Wage Rate - The money rate paid to an employee per hour.

Wage Structure - Usually established within an organization, this is the levels or hierarchy of job and pay ranges. The salary structure is also referred to as job grades, job-evaluation points and/or policy lines.

Wage Survey - A survey of the going rates for benchmark jobs in a particular market.

Work-Design Variances - Differences that exist in similar jobs within two or more organizations.

Workers'' Compensation - Government-mandated insurance that provides benefits to covered employees and their dependents if the employee suffers job-related injury, disease, or death.

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