Over one in three (37 percent) New Zealand employees’ pay is currently linked to performance and this figure is rising, according to survey by recruitment firm Hays.
Presently 15 percent of employees’ pay is directly linked to monthly performance and further 22 percent to quarterly or other performance. This is an increase of 10 percent since 2001 when 11 percent of employees’ pay was linked to monthly performance and 16 percent to quarterly or other performance.
“Many employers believe systems linking performance directly to levels of pay improve company’s competitiveness and productivity,” says Jason Walker, regional director of Hays in New Zealand.
“This form of pay is often based on achieving or exceeding set key performance indicators, targets or productivity increases,” he says.
Historically it was mainly the executive team that shared in company’s success through performance-related pay, but more employees now benefit. Performance-related pay is not for everyone with some preferring the stability of knowing exactly what their weekly earnings will be.
“Furthermore, salary is just one of many factors in successful retention. Career progression, new challenges, training and development and strong management are all critical to the retention mix,” Walker says.
For more information see www.hays-hps.co.nz
