Incentive Pay and/or Gainsharing
Alex
1 Post
I work for a non-profit organization that has awarded annual salary increases to employees based on their performance. The salary pool from which these increases have been awarded has averaged about 4% of total salaries over the past few years. Merit pay has been awarded as an increase to the employee's salary (vs. lump sum bonuses), unless the resulting new salary would be above the top of the range. In that event, the salary is increased to the top of the range, and any remainder is paid in a lump sum.
Our board would prefer to have a less expensive way to award salary increases. They have suggested very modest COLA's as increases to salary, with some incentive or merit amount being paid in a lump sum. Since our salary pools have been fairly modest, though, I'm concerned that there won't be much money to act as "incentive" or reward performance (e.g., COLA at 3%, employee would get the maximum equivalent of about 1% his/her salary in bonus form for merit)
Has anyone faced this issue? If so, what did you do? Have you worked with any incentive pay or gainsharing models you liked? If so, which one(s) and what did you like? Do you have any information you can provide or any resources you can point me to? Any assistance will be much appreciated.
Thank you!
Our board would prefer to have a less expensive way to award salary increases. They have suggested very modest COLA's as increases to salary, with some incentive or merit amount being paid in a lump sum. Since our salary pools have been fairly modest, though, I'm concerned that there won't be much money to act as "incentive" or reward performance (e.g., COLA at 3%, employee would get the maximum equivalent of about 1% his/her salary in bonus form for merit)
Has anyone faced this issue? If so, what did you do? Have you worked with any incentive pay or gainsharing models you liked? If so, which one(s) and what did you like? Do you have any information you can provide or any resources you can point me to? Any assistance will be much appreciated.
Thank you!
