Performance Related Pay (PRP)

Some of an employees pay is linked to the achievement of targets at work

Targets may be sales targets or performance appraisal

Criticisms of PRP

Many employees see this as unfair as can be based on an appraisal interview

Lots of businesses don’t put sufficient money aside so employees only get a small bonus

Developments in PRP

Increasingly firms are using a system called Variable pay

This a flexible type of PRP which offers employees a highly individual pay system related to their performance

Higher rewards for star performers