Introduce, manage and review a performance-related pay scheme

Key points

Many organisations link employees' pay to their individual performance. Employers that are considering introducing a performance-related pay scheme should decide on the appropriate form of assessment of employee performance and how this will link to the pay review.
Employers should operate a transparent process so that employees understand how their performance links to their pay review.
The individuals who will conduct performance reviews and allocate pay awards should be appropriately trained.
Employers that operate a performance-related pay scheme should carry out regular reviews of the scheme to check that it is meeting its aims and objectives.
They should also monitor their performance-related pay scheme to ensure that there is no unfair discrimination taking place in the allocation of pay awards.