Advantages of Incentive Pay

BHR 3352 UNIT 6 11
Name:
Subject:
Date of Submission
According to Noe, Hollenbeck, Gerhart, and Wright (2011), the prevalence of individual incentive pay-for-performance programs in the business industry continues to rise over the years. Incentive pay is a monetary gift given to an employee based on positive output delivery in the form of a commission, profit-sharing or a bonus.
Advantages of incentive pay
First, incentive pay increases the amount of employees output. This is as a result of the motivation to increase their efficiency so as to get more wages. Secondly, there is a decrease in labor turnover. Employees rewarded properly for their hard work are unlikely to leave the company hence the company’s production is not affected by labor shortage. Thirdly, idle time among employees is reduced. Every employee wants to be recognized and get the incentive pay hence will use...