25 Jun, 2013

Results-based pay

There is widespread support for performance-based pay in the UK with almost a third of workers already on results-based pay arrangements, and many others saying they would become more productive at work if they were.

30 per cent of UK workers have their pay tied to some form of performance or productivity targets, according to the latest findings from the Kelly Global Workforce Index (KGWI).

Among those not on performance-based pay, 40 per cent say they would be more productive if they had their salaries linked to performance targets.

This trend reflects growing recognition that businesses and employees perform best when their interests are aligned, including through incentive-based pay.

“There are many UK employees who are clearly confident in their ability to do their jobs well, and they want the opportunity to be rewarded according to their performance,” says Gary Jones, Managing Director, Kelly Services UK & Ireland.

The highest rates of performance-based pay are recorded by respondents in China (75{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e}), Russia (70 percent), Poland (55 percent), Netherlands (48 percent), Belgium (45 percent), Germany (43 percent), and Switzerland (40 percent). Rates in other countries are Hungary (38 percent), France, Luxembourg and Portugal (all 36 percent), Italy (35 percent), Norway (32 percent), Ireland (26 percent), Sweden (24 percent) and Denmark (21 percent).

Results of the survey in Europe also show:

  • When asked to choose between pay for overtime worked, and pay for performance, more than half (54{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e}) would choose pay for performance.
  • The choice of performance pay is higher among younger workers in the Gen Y and Gen X demographics, and also among males, and those with professional or technical jobs.
  • Less than one-third (32{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e}) of those surveyed agree that their current pay is fair
  • Among job sectors, the highest rates of performance-based pay are in Sales (78{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e}), Finance and Accounting (47{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e}), and Engineering (35{6060b2de664e4eaa3e7b7e86961ce2c4bbd7a29b6c1097abf8257a4e5b07383e}).

Gary Jones says a renewed focus on ways of increasing productivity in organisations has placed added emphasis on the role of pay in raising business performance.
Credit: onrec.com

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