Miss
International Pathways and Language Centre
Summer Pre-sessional Course 2013
With reference to a specific industry or profession, discuss whether performance-related pay improves the productivity of the workforce.
(PRP in insurance industry)
Student Name: JING ZHAO
Student Number: 1327088
Date of Submission: 23rd.Aug.2013
Word Count: 1345
Contents 1. Introduction 3 2. Purposes of performance-related pay 4 3. Impact of performance-related pay 5 4. Problems of performance-related pay 6 3. Conclusion 7 4. References 8
1. Introduction
What is performance-related pay? Performance-related pay is pay or a salary increase which is based solely on how well someone performs their job as compared to the expectations of the job, also known as their job description. Furthermore, what is the key to all performance-related pay systems? Performance related pay cannot be determined unless there is a measuring system in place to assess output. It also provides a limiting factor to the use and extension of incentive pay in instances where work is difficult to measure. Usually, there are two types of pay or pay increase, one is performance-relate pay, as defined above, the other is tenure related, which means you 're giving the employee 's pay rate or increase is based on how long they 've been with the company.
Some 40% of respondents to Kelly Services’ annual Kelly Global workforce index claim that they would be more productive if they had their salary (Employee benefits, 2013). As mentioned by Paterson, but the survey, which polled nearly 90,000 employees in 30 countries, found that just one third (30%) of respondents’ pay is tied to some form of performance or productivity target (ibid).Gary Jones, managing director at Kelly Services UK and Ireland, claims that 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. And he also said:
Summer Pre-sessional Course 2013
With reference to a specific industry or profession, discuss whether performance-related pay improves the productivity of the workforce.
(PRP in insurance industry)
Student Name: JING ZHAO
Student Number: 1327088
Date of Submission: 23rd.Aug.2013
Word Count: 1345
Contents 1. Introduction 3 2. Purposes of performance-related pay 4 3. Impact of performance-related pay 5 4. Problems of performance-related pay 6 3. Conclusion 7 4. References 8
1. Introduction
What is performance-related pay? Performance-related pay is pay or a salary increase which is based solely on how well someone performs their job as compared to the expectations of the job, also known as their job description. Furthermore, what is the key to all performance-related pay systems? Performance related pay cannot be determined unless there is a measuring system in place to assess output. It also provides a limiting factor to the use and extension of incentive pay in instances where work is difficult to measure. Usually, there are two types of pay or pay increase, one is performance-relate pay, as defined above, the other is tenure related, which means you 're giving the employee 's pay rate or increase is based on how long they 've been with the company.
Some 40% of respondents to Kelly Services’ annual Kelly Global workforce index claim that they would be more productive if they had their salary (Employee benefits, 2013). As mentioned by Paterson, but the survey, which polled nearly 90,000 employees in 30 countries, found that just one third (30%) of respondents’ pay is tied to some form of performance or productivity target (ibid).Gary Jones, managing director at Kelly Services UK and Ireland, claims that 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. And he also said:
References: Asia Pacific - focus on insurance,September 2012 , Available at: http://www.nortonrosefulbright.com/knowledge/publications/70300/asia-pacific-focus-on-insurance [Accessed 17 July 2013] Burton, D. 1994. Financial services and the consumer. Routledge. London. [online book],Available at:http://books.google.co.uk/books?id=rUcOAAAAQAAJ&pg=PA61&lpg=PA61&dq=performance-related+pay+insurance+industry&source=bl&ots=LP3g9zYy3n&sig=c2Bk6QX31iMks8mtFA_J0l1RLYE&hl=zh-CN&sa=X&ei=FFDsUdPUKIqY0QXG3YCADg&ved=0CEIQ6AEwAg#v=onepage&q=performance-related%20pay%20insurance%20industry&f=false p61-62. [Accessed 21 July 2013]Paterson, J, Employees believe performance-related pay fuels productivity. [Employee benefits online], 25 June 2013. Available at:http://www.employeebenefits.co.uk/benefits/pay-/-bonus-and-reward/employees-believe-performance-related-pay-fuels-productivity/102355.article [Accessed 17 July 2013]Performance-related pay. [local government online ], Available at: http://www.lge.gov.uk/lge/core/page.do?pageId=119829 [Accessed 20 July 2013] Storey, J. 1993. Managing human resources and industrial relations. Biddles Ltd, Guildford and King’s Lynn Xiao, E. 2007. A Study on Performance Related Pay of Foreign Financial Multinational Companies in China [pdf], Available at: http://edissertations.nottingham.ac.uk/1024/1/07MALIXEX.pdf.pdf [Accessed 17 July 2013]