Types of Performance Compensation Plans
A company can approach performance rewards from many points of view.
To next, some of them:
• Plans based on the individual. At its lowest level, companies seek to identify and reward individual employee contributions. These are the plans that are most used in the industrial sector: merit pay, individual bonus programs, bonuses, and so on.
• Team-based plans. These plans usually reward all their members equally based on the results obtained by the group. These results can be measured objectively.
• Plans that encompass the entire factory. Examples of these plans are known profit sharing programs, profit sharing, etcetera.
• Plans for special groups of employees. These plans generally apply to direct and sales employees. The performance of these groups is so delicate for the rest of a company that it is common to find special reward plans for them.