We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Nobody downloaded yet

Incentive pay as a way of compensating employees - Essay Example

Comments (0) Cite this document
Summary
Definition of the Topic Incentive pay is a way of compensating employees other than wages and salaries and is linked to the employee’s performances. Employers reward their employees for attaining organizational goals and work objectives (Martocchio 82). Generally, incentives are given in form of cash…
Download full paper
GRAB THE BEST PAPER
Incentive pay as a way of compensating employees
Read TextPreview

Extract of sample
Incentive pay as a way of compensating employees

Download file to see previous pages... According to the Vision Link advisory group, intrinsic rewards also allow employees to obtain a certain level of autonomy, provides opportunities for mastery in which employees may feel and see their progress, and it can establish purpose in their work so that they can feel that they are doing something good not only for themselves but also for the company. On the other hand, extrinsic compensation may include monetary and nonmonetary rewards. Examples of extrinsic compensation can be discretionary benefits such as paid time off and protection programs (Martocchio 86). Generally, “Incentive pay may come in the form of bonuses, profit sharing, or commission” (Business Dictionary). It is a monetary reward given to employees based on individual or group performances. This type of pay can reflect the way employees continue to pursue positive results in the workplace. In addition, incentive plans can inspire loyalty, commitment, and hard work. This type of plan will allow for recognition of outstanding workers and at the same time keeping track of the organizational goals (“Employee Incentive”). A company can decide on how they will design their incentive pay plans and on what criteria depending on what industry and type of the company. The most common types of incentive pay plans are individual incentive plans, group incentive plans, and companywide incentives. In many occasions, “Individual incentive plans reward employees for meeting such work-related performance standards as quality, productivity, customer satisfaction, safety, or attendance” (Martocchio 85). Organizations use individual incentive plans to motivate their employees by granting them the opportunity to receive additional income. These additional incomes can be given in forms of bonuses or commission (Joseph). There are different types of individual incentives the most common are piecework plans, management incentive plans, behavioral encouragement plans, and referral plans (Joseph). Piecework plans reward their employees for increases in productivity. It consists of the quantity and the quality of work produced. This criterion is based upon the supervisor’ or managers’ interpretation on the performance of the employee. Piecework plans can be used in industrial and production settings (Joseph). In contrast, management incentive plans involve several intricate objectives. This type of incentive only allows managers to receive their award when they reach objectives depending on sales, profit, production, or other criteria in the company (Martocchio 86). In addition, many companies may compensate their employees for referrals. Some companies use referrals to motivate their workers to recruit new employees into the company the employee will then be rewarded after the new employees has been in the company for a certain period (Joseph). Lastly there are behavioral encouragement plans where employees are given cash for specific behavioral accomplishments. In addition to individual incentive plans, some companies choose to compensate or reward their employees as a group, in other words, based on collective performance. Group incentive plans are measured depending on customer satisfaction, labor cost savings, material cost savings, reduction in accidents, and services cost savings (Joseph). It is said that “well designed group incentive plans ultimately reinforce teamwork, cultivate loyalty to the company, and increase ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Incentive pay as a way of compensating employees Essay”, n.d.)
Retrieved from https://studentshare.org/business/1397407-insentive-pay
(Incentive Pay As a Way of Compensating Employees Essay)
https://studentshare.org/business/1397407-insentive-pay.
“Incentive Pay As a Way of Compensating Employees Essay”, n.d. https://studentshare.org/business/1397407-insentive-pay.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document
CHECK THESE SAMPLES - THEY ALSO FIT YOUR TOPIC
The Hutton Review of Fair Pay in the public sector (http://www.hm-treasury.gov.uk/indreview_willhutton_fairpay.htm) focused on e
They further observe that limiting the stock and stock options in incentive reward plans for executives can substantially help rectify the problem of executives being paid for temporary growth at the expense of the continuing health of their companies (qted in Kroll, 2005).
6 Pages(1500 words)Essay
Are Bonus Schemes an Effective Way of Motivating Employees
It is no surprise then that the study of motivation has been of interest in many fields that include economics, decision making, sociology and psychology, as in some way or the other human nature and behaviour are integral to these fields. In essence an understanding of what drives and describes actions involved in human behaviour is critical to the efficiency of interventions in any of these fields (Steel & Konig, 2006).
8 Pages(2000 words)Essay
Analysing Argument - A Way to Pay for College, With Dividends
The author point out towards certain options available for the students to manage the finance for their studies. The article basically strives to provide some solution to the problem of getting finance for the higher education. In the article, the author includes different possibilities that could work to generate finance for students’ higher education and discuss the pros and corns of each of the described method.
6 Pages(1500 words)Essay
Topic: Decision Rights: Bundling Tasks into Jobs and Subunits + Attracting and Retaining Qualified Employees + Incentive Compe
The credo of J&J lays down the essentials of how to please a customer and to achieve their organizational goals, but not limits and restricts managers on how to achieve it. The transition which has occurred from the traditional functional units towards units that have decision rights has resulted in increase of success rate for J&J.
2 Pages(500 words)Essay
Employees Incentive System
Not only corporations are experiencing the anxiety poised by global liberalization, but workers also feel the high level of uncertainties. As workers are no longer sure how long will they stay on the job and or even get an increase in pay (Tully, 1995; Schraeder and Becton, n.d.).
14 Pages(3500 words)Essay
Pay-for-performance: incentive rewards
This tool is also used when it comes to self assessment of an employee. “360 degree feedback allows each individual to understand how their effectiveness as an employee, co-worker,
8 Pages(2000 words)Essay
How might performance-related pay (PRP) improve performance Are there other forms of financial incentive that could be better suited to the task
At the same time, the personal goals and career development of the employees have also become major work paradigms that must be addressed by
8 Pages(2000 words)Essay
Higher pay is the only way to reduce corruption. Discuss
Corruption can be a serious problem, such as when it becomes a large-scale corruption which is considered an emergent social process. The occurrence of large-scale
8 Pages(2000 words)Essay
Incentive Pay Plans
This plan suffers from the weakness of difficulty in job performance specification and measurement, identification of valued rewards and linking rewards to performance. To
1 Pages(250 words)Research Paper
Should Public Employees be Required to Pay an Agency Fee
Under the law, employers are not permitted to distinguish against employees who choose to join a union. For example, it is against the law for an employer to threaten to close their businesses or dismiss workers or even take away workers benefits if they decide workers form
12 Pages(3000 words)Essay
Let us find you another Essay on topic Incentive pay as a way of compensating employees for FREE!
Contact us:
+16312120006
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us