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1、.Contribution Pay (Pay Linked to Performance) A Positioning PaperBackgroundThe Pay Commission Report for the National Employers Organisation for Local Government Services recommended that “contribution pay combined with service-based progression is suggested as a way forward, contribution defined as
2、 skills acquisition, competencies and qualifications.”The Employers Organisation paper Reviewing and Modernising Pay Frameworks (2004) stated that:“Competence or skill based progression holds appeal in non - profit driven sectors, although sometimes clear performance targets are harder to define. Sk
3、ill- based progression however does involve extensive preparatory work in order to:· Define the competencies which will drive progression· Define the states in the acquisition of those competencies which will trigger progression· Ensure that managers can operate the system.”The NJC is
4、sued Joint Guidance on Pay & Grading Reviews in 2005. Advice on options for incremental progression included using experience, skills & competencies, contribution and performance or a combination of these.IntroductionTraditional performance related pay (with variants of contribution and comp
5、etency pay) has received good and bad press. The concept is a good one ie rewarding individuals or groups for above average performance, but has often been marred in its implementation. The purpose of this positioning paper is to gauge interest amogst London Boroughs in developing a tool kit approac
6、h to implementation of pay linked to performance. The tool kit would encompass the theoretical rationale for performance pay, as well as practicalities of implementation the dos and donts though probably less prescriptive than it may sound on paper.ApproachThe suggested approach to producing a tool
7、kit would be to formulate a project plan, involving interested parties, in its development and completion.The proposal adopts a project methodology, as follows.· Define the problem and the objectives (including terms of reference)- Define types of pay linked to performance (PRP, Contribution, C
8、ompetency) - Why produce a pay linked to performance tool kit - Define who the customer is?- Define what the benefits from its production might be? (including what the wider benefits of linking pay to performance might be) · Plan how to progress including undertaking benchmarking/research
9、 into the subject - research theoretical models (Employee motivation, Employee Satisfaction)- talk to employers (private & public sector) to establish critical success factors- explore/evaluate options for progression/reward such as:v Fully integrated into progressionv Top of scale en
10、hancementv Mid point market rate enhancementv Consolidated - non-consolidated- explore and evaluate measurement/progression criteria such as:v Target achievement criteriav Competency achievement criteriav Stages/defined incidences of progressionv Job profiles- Consider tools for measurement v Eviden
11、cing performance- Consider affordability such as:v Budget allocation/cappingv Quota systems- Implementation guidance on:v Communication/consultationv Trainingv HR support· Organise what the stated outputs are and who's going to do them- Product- Project team & any other resource - Timetable · Review/control progress- Monitor progress against project timelines/objectives· Install deliv
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