Person Focused Pay Essay

A person-focused pay program rewards employees through compensation for acquiring and implementing job related competencies, knowledge and skills and not for exhibiting and displaying successful job performance (Martocchio, 2013). Pay-for-knowledge compensation plans base employee’s pay on the number of jobs in the organization they can do rather than on the specific jobs they may be doing at a particular time. Typically, when hiring new employees, they start off at a base rate, and as they learn different jobs and skills in the company, their pay rates go up correspondingly. Thus, each additional skill that employees learn, pay raises are attached, encouraging them to become multi skilled (Curington, Gupta, & Jenkins, 1986).

Essentially, when the worker switches

Likewise, this type of system takes into consideration the knowledge, skills, and abilities the employee possess upon hiring and learns in the course of the assessment period. In this manner, employees are fairly compensated for what they bring to the organization and is not given pay increases based on general duties. Once an individual employee masters a skill, then it becomes pivotal to to focus on the development of other areas in relation to how they benefit the company.

On the other hand, job-based performance programs are simpler to administer. Once the plan is in place for the job, and as long as the duties do not change, you can use it for all current and future employees who fill that position. Because you will be using the plan on many occasions, it becomes less complicated for you to complete. Person-focused pay programs, however, are specific to each employee. Although, employees who fill the same position will possess similar knowledge, skills and abilities, you will have to review and revise the plan with each new hire, and you will need to study it carefully prior to administering the formal appraisal (Deeb,