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Incentive Pay

Holiday scheduling: 7 steps to help you keep the peace

Issue: Scheduling employees during the holidays can cause logistical and legal headaches.
Risk: At the least, hurt feelings and dampened morale. At the worst, a messy religious-discrimination lawsuit.
Action: …

4 steps for implementing a variable pay program

Making variable pay work requires lots of interaction throughout the organization before, during and after implementation. As the business unit most likely in charge of implementation, it’s up to HR to make sure that happens. Here’s how to do it.

Bonuses bounce back, but bar is set higher


The days of organizations handing out bonuses like Halloween candy seem to be over. While employers have returned to awarding bonuses in 2010, they’re attaching more strings than ever and are more likely to look at “hard” financial performance metrics when making variable pay decisions.

Taking FMLA leave may rule out performance bonus

Under the right circumstances, employers that pay discretionary bonuses based on actual performance don’t have to make the extra payments to employees on FMLA leave. Thus, a discretionary bonus based on performance during each quarter may not have to be paid if the employee didn’t work.

OK to pay commissions on a flat-rate basis–it won’t violate FLSA commission exemption


For years, the DOL has argued that commissions must be based on a percentage of sales in order to be valid. But now the 3rd Circuit has approved a different form of commissioned sales—one in which employees are paid based not on the total amount of the sale, but on other factors such as whether the sale was made on an outgoing sales call or an incoming one.

Ensure fair distribution of work opportunities


Does your company employ salespeople who are responsible for meeting certain benchmark goals? If so, be sure you have some way to check that everyone competes on an even footing. That includes ensuring that things like territories and leads are distributed in a way that doesn’t favor members of one group at the expense of another.

Beware legal risk of raising employee’s title in lieu of pay


With nervous employers still keeping generous raises on the shelf, more companies are turning to job title promotions to show their appreciation. The risk: The titles themselves don’t reflect the duties of the position and required expertise, which can cause difficulty separating exempt and non-exempt employees.

Employers still giving raises, mostly to high performers


U.S. employers will hand out pay raises averaging 2.5% across all employee categories in 2010, according to the annual WorldatWork 2010-2011 Salary Budget Survey. But in most cases, the size of the raise will depend on how well employees have performed. Employers “are no longer averse to withholding merit increases for poor performers so they can afford to grant meaningful increases to better performers,” says Anne C. Ruddy, president of WorldatWork.

5 steps for starting a pay-for-performance system


Most organizations believe they do pay for performance. They don’t. If you’re committed to starting a true pay-for-performance system, you’ll want to ease into it with lots of crystal-clear communication. Here are five ways to get started.

Case appears headed for court? See if union contract requires arbitration instead

There’s at least one upside to having a unionized workforce: Employees who have disagreements over pay or benefits generally have to use the arbitration process authorized in the union contract to pursue their claims. Your collective-bargaining agreement can save employers from expensive trips to the federal courts.