Tess C. Taylor, PHR, The HR Writer
The nature of pay for performance has come under fire many times, yet this compensation strategy is based on sound business principles that have been around for ages. Traditional theories of positive reinforcement have been shown to have a direct link to performance in the workplace. It is common sense -- when employees are provided with a reward system that is tied to their job performance, this tends to motivate and inspire them. In a nutshell, when employees clearly understand what they stand to gain financially from good performance, they have a more focused effort on meeting these performance goals in order to be compensated.