The New Pay — Losing Sight of Reality?

Management Research News

ISSN: 0140-9174

Publication date: 1 April 1996

Abstract

The growth of more contingent pay systems has been a key development in the 1980s and 1990s. Various contextual changes — such as the pattern of employment, the decline of collective bargaining and Government support for particular initiatives to encourage financial participation — has given employers an increasing freedom in determining both the composition and level of remuneration (Brown and Walsh, 1994). This new freedom has allowed new pay systems to develop which are, according to the prescriptive literature, much more contingent on individual business circumstances than in the past (Armstrong and Murlis, 1994; Schuster and Zingheim, 1992). Pay determination has become increasingly linked to the performance of the individual company or business unit, the team or work group and, of course, the individual employee. Concepts such as the “going rate”, the “rate for the job” and pay comparability have been challenged and, in some cases, replaced with new approaches to pay determination. These new approaches include “person related pay”, as opposed to “job related” (Mahoney, 1989; Gomez‐Meja and Balkin, 1992); more decentralised pay determination systems (Millward et al, 1990; Jackson, Leopold and Tuck, 1993); more “variable” or “at risk” pay (CBI, 1994i); and more flexible benefits schemes (IDS, 1991). Most importantly, the concept of “reward strategy” has emerged, the clear linkage of remuneration systems to business objectives and company culture (Hewitt Associates, 1991; Murlis and Armstrong, 1994; Gomez Meja and Balkin, 1992). A recent CBI/Wyatt publication on “Variable Pay” (CBI, 1994) concludes that employers are looking for payment strategies based around three criteria:

Citation

White, G. (1996), "The New Pay — Losing Sight of Reality?", Management Research News, Vol. 19 No. 4/5, pp. 56-58. https://doi.org/10.1108/eb028463

Download as .RIS

Publisher

:

MCB UP Ltd

Copyright © 1996, MCB UP Limited

Please note you might not have access to this content

You may be able to access this content by login via Shibboleth, Open Athens or with your Emerald account.
If you would like to contact us about accessing this content, click the button and fill out the form.
To rent this content from Deepdyve, please click the button.