{"id":2194,"date":"2011-06-21T08:03:23","date_gmt":"2011-06-21T08:03:23","guid":{"rendered":"http:\/\/www.yourhrworld.com\/formats\/?p=2194"},"modified":"2011-06-21T08:03:23","modified_gmt":"2011-06-21T08:03:23","slug":"performance-related-pay","status":"publish","type":"post","link":"https:\/\/www.yourhrworld.com\/formats\/compensation-and-benefits\/performance-related-pay\/","title":{"rendered":"Performance Related Pay"},"content":{"rendered":"<p><strong>I. What is Performance-related pay?<\/strong><\/p><div class=\"69eb924294c115e6505da44099e8df92\" data-index=\"1\" style=\"float: none; margin:10px 0 10px 0; text-align:center;\">\n<script type=\"text\/javascript\"><!--\r\ngoogle_ad_client = \"pub-0867779017855679\";\r\n\/* 300x250, created 4\/20\/11 *\/\r\ngoogle_ad_slot = \"1035864135\";\r\ngoogle_ad_width = 300;\r\ngoogle_ad_height = 250;\r\n\/\/-->\r\n<\/script>\r\n<script type=\"text\/javascript\"\r\nsrc=\"http:\/\/pagead2.googlesyndication.com\/pagead\/show_ads.js\">\r\n<\/script>\n<\/div>\n\n<p><strong>Performance-related pay<\/strong> is money paid to someone relating to how well he or she works at the workplace.<\/p>\n<p><strong>II. Types of Performance-related pay<\/strong><\/p>\n<p><strong>1.\tOrganization-wide incentives:<\/strong><\/p>\n<p>Bonus earnings or pay levels based on measured quantities or values for the whole establishment; this is frequently the basis of contract price or tender-led schemes in local government.<\/p>\n<p><strong>2.\tMerit pay: <\/strong><\/p>\n<p>Bonus earnings or pay levels usually based on general assessment of an employee\u2019s contributions to performance.<\/p>\n<p><strong>3.\tIndividual performance related pay:<\/strong><\/p>\n<p>Bonus earnings or pay levels based on the assessment or appraisal of  an employee\u2019s (or team\u2019s) performance against previously set objectives,  usually part of a performance management system. This is a fairly recent development, particularly in the public sector and has grown sharply in use since the 1980s.<\/p>\n<p><strong>4.\tProfit related pay:<\/strong><\/p>\n<p>Bonus or share options based on the organization\u2019s profit  performance; this is widespread in the private sector, where share  options are often important for senior managers. Profit related pay is  now fairly common in local government.<\/p>\n<p><strong>5.\tCommission:<\/strong><\/p>\n<p>Percentage payments on sales or turnover, paid on an individual or group basis; common in sales, retailing and other branches of distribution.<\/p>\n<p><strong>6.\tPayment by time and output:<\/strong><\/p>\n<p>The distinction between payment by time and output has long been  blurred. Although both systems still exist in their pure forms, a wide  variety has been developed, incorporating elements of both.<\/p>\n<p><strong>7.\tMeasured day work:<\/strong><\/p>\n<p>It is one of the more important examples of a composite system. This occurs in a number of forms, but they all share the characteristics of pay linked on a single or stepped basis with measured output.<\/p>\n<p><strong>8.\tPiecework:<\/strong><\/p>\n<p>A price is paid for each unit of output. This is the oldest form of  performance pay and is still used in some local government direct  service organizations.<\/p>\n<p><strong>9.\tPayment by results:<\/strong><\/p>\n<p>Bonus earnings depend on measured qualities or values of output for  individuals or groups, usually based on work studied time units; this  covers a range of bonus schemes and still form the main method of  performance pay for manual workers.<\/p>\n<p><strong><a href=\"https:\/\/www.yourhrworld.com\/formats\/wp-content\/uploads\/2011\/06\/Performance-Related-Pay.doc\">Click Here To Download Performance Related Pay<\/a><\/strong><\/p>\n\n<div style=\"font-size: 0px; height: 0px; line-height: 0px; margin: 0; padding: 0; clear: both;\"><\/div>","protected":false},"excerpt":{"rendered":"<p>I. What is Performance-related pay? Performance-related pay is money paid to someone relating to how well he or she works at the workplace. II. Types of Performance-related pay 1. Organization-wide incentives: Bonus earnings or pay levels based on measured quantities or values for the whole establishment; this is frequently the basis of contract price or tender-led schemes in local government. 2. Merit pay: Bonus earnings or pay levels usually based on general assessment of an employee\u2019s contributions to performance. 3. Individual performance related pay: Bonus earnings or pay levels based on the assessment or appraisal of an employee\u2019s (or team\u2019s)<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[514,524],"tags":[525,146],"class_list":["post-2194","post","type-post","status-publish","format-standard","hentry","category-compensation-and-benefits","category-salary-management","tag-pay","tag-performance"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Performance Related Pay - HR Letter Formats<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.yourhrworld.com\/formats\/compensation-and-benefits\/performance-related-pay\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Performance Related Pay - HR Letter Formats\" \/>\n<meta property=\"og:description\" content=\"I. 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