Organisations still aren’t positioning employee pay competitively at the top of the market, despite improved economic conditions, according the Chartered Institute of Personnel and Development (CIPD). Their latest annual reward management report reveals that even though the UK’s economy grew by 2.6% in 2014, organisations still aren’t positioning employee pay competitively at the top 10% of their sector.
The survey also found that competencies and skills are increasingly being used alongside individual performance to determine pay progression. The reports states: “This may be a reflection of structural changes towards a service-/knowledge-based economy, which means fewer job types and an increasing emphasis on soft skills. Competencies and skill mix arguably have more impact on performance now than in the past and this may be being recognised through both pay progression and performance-based rewards.”
However, there has been a marked reduction in the number of companies offering performance-related pay schemes (down to 49% in 2014, compared to 65% in 2012).
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