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Individual pay

Variable Pay

Incentive Programs Gain-sharing

Merit Pay Issues

Pay Innovation

Pay Issues

Learning Objectives for C-11

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Individual Pay

Why she is paid higher than me ? I have been

here longer than her!

Why she is paid higher than me? I have more

tasks to do

------ ? She has no paper at all

------ ? I can complete the work faster thanher.

------? I can even do the work better, (quality)

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Experiences,

seniority

performance

Skills, qualification

Individual pay is based on.

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Individual pay methods..

Flat rate

Payment for time

worked

Variable Pay- Incentive

Compensation

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Time worked.

HigherPay!

Skill,

knowledge

Seniority and

experience

Performance,attitude,

mindset

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Variable Pay

Merit Pay

Offshore

Allowance-

Risks

Production

Bonuses

Individual

Incentives

AnnualBonuses

MealAllowance

Cost of Livingadjustment

ClothAllowance

Commissions

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Incentive Program

Star of the

month

Safe worker

of the month

Point system

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Gain-sharing

Gain-sharing is best described as a system of

management in which an organization seeks

higher levels of performance through the

involvement and participation of its people. As

performance improves, employees share

financially in the gain. It is a team approach;

generally all the employees at a site oroperation are included

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Gain-sharings advantages

Help companies achieve sustained improvement in keyperformance measures

Rewards only performance improvement

Payouts are self-funded from savings generated by the plan

Aligns employees to organization goals

Fosters a culture of continuous improvement

Enhances employee focus and awareness

Increases the feeling of ownership and accountability

Enhances the level of involvement, teamwork and cooperation

Supports other performance improvement efforts and helpspromote positive change

Promotes morale, pride, and more positive attitudes toward theorganization

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Gain-sharings disadvantages

Measures are narrower than organization-wide profit and thereforegains may be paid even though profits may be down.

Requires a participative management style

Requires that management openly shares information related toperformance measures

Employees may question or challenge management decisions thatmay adversely impact a gain.

Increases the level of organizational stress since everyone has moreof a financial stake in the organization's success

Applies best to and a work environment that requires teamwork

and collaboration rather that individual entrepreneurship Paid on the basis of group performance rather than individual merit

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Merit Pay Issues

Unable to achieve objectives for the team

Selfish, work independent, unwilling to help

others- affect work output

Perceive as inequity

The size of the pay has little effect on

performance

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Pay Issues

Pay Security

Guaranteed annualwage (GAW)

Supplementary

unemployment

benefits

Cost of Living

Adjustments

Pay

Compression

Younger staff paid

as high as longer-

term employees

Pay secrecy

or openness

Secrecy

Openness

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Pay Innovation

People based Pay

Skill-based pay

Knowledge-based pay

Credential-based pay

Feedback pay

Competency-based pay

Executive Pay