In the past, Payless was hesitant to determine salary increases on individual performance, because of the possibility of demoralizing employees. However, the company decided to follow other companies, because it helps retain top performers and provides more a greater degree of accountability in the corporate culture (Marquez, 2006). As a result, at Payless, the average salary increase for high performers jumped from 9.5% in 2004 to 9.9% in 2005, while the average merit increase only rose 0.2% over the same period. Payless' new program requires its 12 business unit leaders to create a "nine box," with each box detailing an employee profile, how the manager should address the employee's performance and growth potential and what the range of the salary should be. One box may have the name of an employee who is out the door for not performing well enough and another box may have a top...
Both of these companies say it is too early yet to know if this change in compensation approach will be a positive or negative.
Bonuses could also be earned by taking advanced courses in improving classroom techniques and by improving the scores their students achieved on state tests. These salary additions can add up to as much as $9,800 per year. In addition, teachers' pay can be docked if state testing demonstrates that their students have fallen too far below expectations (Philips & Tyre, 2007). The system has been so successful, that Denver has
On the other hand, merit pay systems may inspire unhealthy competition among coworkers or excessive peer pressure among teams of workers whose individual performance are measured together. In the worst case scenario, merit pay can result in unscrupulous conduct and undermine the camaraderie in the work environment to a degree that actually affects overall output negatively instead of positively. Certain vocational environments are more likely to benefit from merit pay
This involves "changing the role of school personnel in such a way that the resulting organization is capable of adapting the program of a given school to meet the needs of the child" (Conte, 1972) (finally, someone remembers that schools are about students not teachers). If the "objective of any reform measure is to increase the potential of the learning environment and facilitate the learning process" then creative ideas
Value of Merit-Based Plans, Incentive-Based Plans, and Profit Sharing Plans Merit-based payment plans, incentive-based payment plans, and company profit sharing plans all can be classified as organizational attempts to foster employee loyalty, increase employee productivity, and make the company a more attractive place to work. Their aim is to increase the motivation of employees to do quality work, above and beyond the expected minimum of the 'job description.' However, the
This sentiment is echoed by a lot of supporters of merit pay who believe the way teachers are paid and how much they are paid must differ if districts are to attract a new cohort of teachers" (Drevitch, 2006). Some of the biggest disputes against merit pay have all been disputed previously, in the 1980's. In the 1980's, global rivalry was undermining U.S. businesses and corporations, and in an attempt
Pay for performance is becoming commonplace in the business world. Pay raises and bonuses are often based on how well one performs on the job or on achieving specific results. However, this is not the case in education. Pay levels are typically based on years of experience and levels of education rather than on teacher effectiveness. As concerns about the quality of the nation's educational systems frequently appear in the
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