Merit pay increases are more common. Pay communicates fairness and competitiveness and reflects historical practices. P ay is decentralized to business units. Job value is based more on external market than internal equity. Some variable pay is provided to nonsupervisory people, diminishing the traditional role of merit pay.
Benefits are cost-contained.
Variable pay plans in form of gain sharing or goal sharing are introduced. Employees are more involved in pay design. Variable pay is becoming the primary performance reward at all levels. Unknown A team is the key organizational performance-based unit. Variable pay is the primary performance reward.