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.

XpertHR resources