The national average compensation for a bank teller in Canada is in the range of $29,000 - $33,500 and for a personal banking associate in product sales is $41k - $55k. Bank tellers receive an hourly rate while banking associates, i.e. financial advisors and mortgage brokers, typically get paid by commission. Based on commissions, there are mortgage brokers who make more than $100 000 per year. This means that, on average, they make three times more than the bank teller. Since banks are for profit establishments, their front line employees, tellers and bank products associates, are in the sales business and trained to sell various products to their customers: debit accounts, credit cards, line of credit, mortgage, foreign funds, business investments, life, home and auto insurance, and more. Banks incentive plans obviously have resulted in inadvertent consequences. 1. Explain what they are 2. In view of business strategies, what are some of the potential risks and pitfalls of adopting an incentive program as the Canadian banks have? 3. What do you think are the greatest concerns for this pay scheme and why? Select your greatest concern for this pay scheme: Up-selling products customers don't need. Customer service after the sale is likely to be neglected. C Earnings tend to fluctuate widely among employees Bank employees are tempted to break the laws. Select what you believe to be the most positive outcome of this pay scheme: The right kind of incentive compensation, if linked to salary in the right proportion, has most of the advantages of both the straight salary and the straight commission forms of compensation. A salary-plus-incentive compensation plan offers greater design flexibility and can, therefore, be more readily set up to help maximize company profits. The plan can develop the most favorable ratio of selling expenses to sales. The field sales force can be motivated to achieve specific company marketing objectives in addition to sales volume UU