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Top Pay for Best Performance. Steve Bates January 2003. Top Pay for Best Performance. Why Reward Employees for a Disastrous Year? Rewarding good employees is the best way to increase productivity and to secure dominance in its potentially lucrative markets
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Top Pay for Best Performance Steve Bates January 2003
Top Pay for Best Performance • Why Reward Employees for a Disastrous Year? • Rewarding good employees is the best way to increase productivity and to secure dominance in its potentially lucrative markets • Experts say that increased use of performance pay could mark the end of an era of entitlement in employee compensation
Top Pay for Best Performance • Compensation experts urge companies to take opportunities during down markets to move farther from a system that relies heavily on across-the-board merit increases to one that focuses on rewarding top performers substantially more than the rest of the field
Top Pay for Best Performance • Experts state that a 7-8% increase is needed to catch anybody’s attention, anything less is welcome but doesn’t help improve productivity • While traditional merit pay is designed to reward workers for past performance, performance pay attempts to motivate future behavior • Roughly 1/3 of performance pay plans fail
