Essay discussing issues. Person-Focused Pay Plans. Types of Person-Focused Pay Plans

Person-Focused Pay Plans
Student’s Name
Institutional Affiliation
Person-Focused Pay Plans
Types of Person-Focused Pay Plans
Person-focused pay programs involve rewarding employees for acquiring new skills, knowledge or competencies related to the job. Person-focused pay plans reward workers for the promise of performance in the future rather than rewarding them for their job performance (Landsberg, 2012; Martocchio, 2017). According to Martocchio (2017), the three types of person-focused pay plans are as follows:
Pay-For-Knowledge
Pay-for-knowledge plans are pay programs that reward managerial, service, or professional employees for learning specific work-related curricula successfully. Workers are paid for their potential to make significant contributions to the job using the skills and knowledge gained.
Skill-Based Pay
Skill-based pay programs refer to pay plans that increase the employees’ pay for mastering new work-related skills. A skill-based pay plan usually refers to the workers who are engaged in physical work, such as carpenters.
Competency-Based Pay
The competency-based pay model distinguishes and characterizes all the competencies that are required for success in a group of jobs set within a given industry. In Human resource practice, competencies refer to a worker’s ability to organize and apply a mixture of knowledge and skills persistently over time to fruitfully perform work as required in a work situation.
Reasons why Companies Adopt Person-Focused Pay Plans
Technological innovation
Due to innovation and advancement in technology, some skills have become obsolete, with technology leading in the automation of more tasks in various fields. Therefore, employers have resorted to combining jobs and bestowing broader duties and responsibilities to employees (Martocchio, 2017). These advancements and changes in technology have necessitated the need for more employee skills and knowledge in the workplace to enhance efficiency, product quality, and improve customer experience.
Increased global competition
As a result of increased global competition, many companies continue to explore new ways of im...