In the modern business environment performance related pay is still a key component within many organisations. However it is increasingly more likely …show more content…
The idea behind this is that by compensating employees to learn new skills will mean they will be more enthusiastic and have a more positive approach whilst undertaking the training needed. Hence when applying these skills in the workplace the employee will be more effective and efficient whilst working benefitting them and the organisation.
There are advantages and disadvantages to the use of skill based pay. One advantage is that employees will have more self-esteem due to their increase in personal development which will also enhance their self-management capabilities. Also employees will be able to adapt to the ever changing advancements in areas such as technology due to their learnt