Rewards system can influence a number of HR processes and practice which in turn impact on organisational performance as employer and employee are stands on different side of objectives, to pay depending on corporate needs, …show more content…
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Type of Payment systems
Payment system is important part of reward management, normally there is three types of payment systems, they are Time based pay, incentive-based pay and group-based pay system.
1.Time-based Pay—is a sort of schemes for most white collar and professional workers, to ensure that employees will work to the best of their ability and be prepared to work hard because of the security the schemes offered. Time rates are usually expressed as an hourly rate, a weekly or monthly wage, or an annual salary base. There are two forms of time rate. The first one is a flat rate per period of time, while the second one incorporates fixed scales, with increases based on length for service. Time based pay is easily understood by employees, and unlikely to cause dispute. On the other hand they are limited in providing work incentives (Acas 2006). In recent times TBP becomes less extensive as employers seek to reward shorter-term performance and motivate employees to increase their contribution to organizational …show more content…
Marchington and A. Wilkinson 2012). In Japan, Korean, and some other eastern countries, employers treat loyalty as central to the corporate ideology. TBP systems are used to provide long-serving staff so that it can enhance the Japanese culture.
2. Individual performance-related pay (IPRP) provides workers with a target to aim and financial recognition for their efforts and success in contributing to organizational goals. IPRP (individual performance-related pay) is the effective way in organizations where there is a meritocratic culture and performance can be measured accurately.
Methods: employees receive a base-rate level of pay which can then be supplemented by a percentage based on performance; typically this is quite small at no more than 10% of base pay. IPRP schemes provide individuals with rewards linked to an assessment of performance, usually in relation to agreed objectives (M. Marchington and A. Wilkinson 2012) .For examples, in my organization, the performance related pay of membership service department is related to the growth rate of new members, the laps rate and as well as the survey result of customer satisfaction.
Potential benefits of