Pay for Performance Analysis

Pay-for-Performance Philosophy: objective standards and results, fair distribution – extra effort equates to extra reward

Incentive Plans:

· Allow organizations to reward employees for continued contributions: additional projects, programs, developmental tasks

· Goes above job description (base position)

· Focus: results

· Variable pay: ties pay to some measure of individual, group, or organizational performance (bonuses, incentives, recognition for good work, rewards for continued contributions

· Measurement: clear standards and metrics, fair and unbiased assessment of performance

Information:YOUR pay-for-performance plan for your 12 employeesMetrics establishedStandards established: 5=Excellent, 4= Outstanding, 3=Meets Standards, 2=Needs Improvement, 1=PoorCurrent annual salary ranges and employee midpointCompetition’s (market) salary rangesMerit pool: $10,374
Instructions:Read and reflect on “pay-for-performance” concepts and data provided above.
1. How many employees are eligible for the merit pool?
2. How did you determine eligibility?
3. Who will receive the largest proportion (percentage) of the merit pool?
4. Feedback to your employees: what will you focus on?

Employee #Employee NameAnnual $Total AppraisalKnowledgeInitiativeTeamworkQualityQuantityCustomer Svc

12James, Brian25,480.00$ 3.8343.5444

11Sotomayor, Sara26,000.00$ 3.43.534433

10Harris, Kevin27,560.00$ 2.7323323

9Johnson, Evelyn27,040.00$ 2.8332333

8Nguyen, Cara28,080.00$ 3.543.543.533

7Smith, Will28,600.00$ 3.2433333

6Ahmed, Farrokh29,120.00$ 3.8343445

5Whitmer, Gretchen29,640.00$ 4.254.5443.54

4Li, Jiao30,160.00$ 3.3443333

3Perez, Santiago30,680.00$ 2.7332233

2Fischer, Stephan 31,200.00$ 3.23.533.5333

1Nakamura, Aimi32,240.00$ 3.0333333

Standards5 = ExcellentEmployee Midpoint31,000.00$

4 = OutstandingMarket range $ 27,200 – 34,900

3 = Meets StandardsMerit pool10,374.00$

2 = Needs ImprovementParticipation rate9/12 = 75%

1 = Poor