Incentive pay programs have been popular for decades, because many business managers believe that paying for performance can motivate workers and increase productivity. Nevertheless, the largest incentive-pay packages are becoming less common, and there is a flattening of incentive pay as a component of overall compensation. This report we provide data on the percentage of employees receiving incentive pay by job level, the percentage of compensation comprising incentive pay, and the percentage of incentive pay based on individual, group, and company performance. We conclude with recommendations for implementing effective incentive pay programs and mitigating the unintended consequences. (17 pp., 4 fig.)
[Research Byte]
[Research Byte]
