Performance Pay

Performance pay refers to a compensation system in which employees receive financial rewards based on their work performance, productivity, or results achieved. Unlike fixed salaries, performance pay can include bonuses, commissions, or profit-sharing. The idea is to motivate employees by linking their earnings to their individual or team contributions to the organization's success. This approach aims to encourage higher productivity and align employees' goals with the company’s objectives, leading to increased efficiency and motivation in the workplace.