performance related pay

Essay text:

?It is a bonus salary increase awarded in line with an employee's achievement over a range of criteria.' These criteria depend on each job. (David Lines and Ian Marcouse pp) A company that adopts this method has to set clearly defined objectiveso that staff know what they rae doing. Awards are decided based on appraisal results. They must link achievements to pay (and decide how much to pay and where the money comes from). This table looks at the advantages and disadvantages of Performance Relate Pay from the article: Advantages Disadvantages ? Only those who perform well get paid ? Rewards employees with highest productivity ? It is argued this system motivates staff ? It enables firms to recruit highly qualified staff who like the idea of being able to earn a bonus ? Encourages employees whose performance is not up to scratch to leave company on a voluntary basis ? Easy to identify companies aims and objectives ? High flyers find it attractive ? Possible to give employees no pay rise at all ? Inflations means pay will be cut and this coupled with the indignity of being judged and found wanting would, would make it that employees seek a job elsewhere ? Union influence within the company diminishes and employees negotiates their pay individually and furthermore appreciates that their bonus depends on the company being successful ? Staff do not always feel they are appraised fairly ? Works against good team spirit as it every man for himself Views of Transmitacom staff 30% For 70% Against As Transmitacom is producing software, employees should try to work together to enhance quality...