Following are the work records of five employees. As their supervisor, you have just completed their annual appraisal reviews, and it is now time to make recommendations for their future salary. Your department budget has $5,780 allocated for salary increases.

1. Janet Jenkins currently earns $41,000. Her performance appraisal rating was very high. She is respected by her peers and is felt to be an asset to the work group. She is divorced and has three young children to support.

2. Russell Watts earns a salary of $36,000. His annual performance appraisal was average. Several members of the work group have spoken to you about the difficulty involved in Russell's job. They feel that it is a tough and demanding job and that he is doing his best.

3. Jack Perkins earns $31,250. His performance appraisal was below average, and he seems to have difficulty adjusting to his coworkers. Jack has had a difficult time this past year. His wife passed away early in the year, and his father has recently been diagnosed as terminally ill.

4. Rick Jacobson earns $28,000. His performance appraisal was above average. He is respected by his peers and is generally considered to be a "good guy."

5. Paula Merrill earns $28,850. Her performance appraisal was very high. Her peers are upset because they feel that she is working only to provide a second income. Moreover, her peers see her as trying to "show them up."

Answer the following questions:

1. Using the information provided, create a system to distribute the $5,780 among your employees based on the descriptions for each subordinate. Describe the system you created in detail so that it could be used in other departments or for future decisions.
2. Explain in detail why each employee received the salary increase they did.
3. Do you believe this is a fair method of determining the salary increase for each employee, why or why not?
4. How do you think your employees would feel about the method used to administer the salary increases? Explain why.