By Derek Irvine, originally posted on Globoforce Blog, on August 23, 2010.
A Workspan magazine article (“Does Merit Pay Still Have Merit in the New Economic Reality?”, access requires subscription) earlier this month really brought home the challenges of merit pay today. As the article points out, the practice of merit pay began in the 1970s when merit budgets where 6-8%, not today’s much lower 2-3% that must be divided up between all employees. Why are we still relying on a tool created 30 years ago in a much different economic and workplace reality?
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