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What Are the Different Types of Incentive Pay? How Should

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What are the different types of incentive pay? How should organizations choose the right type of incentive pay?


Definitions:

Point System

A method of performance evaluation or employee recognition where individuals earn points for various achievements, which can be exchanged for rewards.

Job-Evaluation Technique

A systematic process for determining the relative worth of a job in comparison to other jobs within an organization, usually considering factors like skill, effort, and responsibility.

Compensable Factors

Characteristics of jobs that are valued by the employer and are compensated for in the form of wages, salaries, or benefits.

Stock-Option Plan

a compensation scheme that gives employees the option to buy company shares at a predetermined price, usually as an incentive or reward.

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