The Effect of Performance-Related Pay on Employees

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The Effect of Performance-Related Pay on Employees

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Write a literature review on The Effect of Performance-Related Pay on Employees.

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According to Perry et al. (2017), PRP is a financial reward for workers whereby a portion or all their monetary compensation is determined by how their performance is evaluated concerning stated criteria. PRP offers individual workers with monetary rewards tied to an assessment of their job performance like piecework payments or financial profit sharing. For example, an organization could decide to compensate a sales representative based on the number of sales he/she makes. The amount of sales would be the criteria which the management determines how the PRP will be implemented. A section of human resource managers has often debated on whether or not PRP is a practical tool.

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