VARIABLE PAY ,INCENTIVES FOR PERFORMANCE

VARIABLE PAY ,INCENTIVES FOR PERFORMANCE

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SECTION 4

Compensation

Pay for performance can be a part of total rewards. As discussed in the previous chapter, more employers are moving toward systems providing base pay for performance using matrixes and other means, rather than just giving all workers a standard percentage increase in pay. If the question is whether people work harder because pay is tied to performance, the answer is yes.

Tying pay to performance holds a promise that both employers and employees find attractive. For employees, it can mean more pay; for employers, it can mean more output per employee and therefore more productivity. However, it is much more difficult…