Incentive Pay

Bonus for exempt workers: What’s the best way?

11/25/2010

Q. Everyone has been working extra hard this year, especially our exempt salaried employees. We want to reward them with extra pay. Can we pay them overtime if they put in more than, say, 50 hours in a week? Or is it better to offer a one-time bonus? I don’t want to affect their exempt status.

Ban all supervisor comments about workers’ ages

11/19/2010

Here’s something to include in your regular supervisory training sessions: Remind everyone that they should banish from their vocabularies any slang or colorful terminology that hints at age discrimination. “Ageisms” can make legitimate business decisions like altered compensation plans, new job duties and other necessary changes look like pretexts for getting rid of older workers.

Prepare for payroll confusion in new year unless Congress takes action

11/11/2010

Unless a lame duck Congress acts by Dec. 31 to keep some of the so-called “Bush tax cuts,” tax rates will increase on Jan. 1, 2011, as pre-2001 rates go back into effect. That’s bound to upset employees who will find themselves with less take-home pay.

4 steps for implementing a variable pay program

10/26/2010

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

10/06/2010

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

10/01/2010

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

09/24/2010

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

09/24/2010

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

09/09/2010

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

08/30/2010

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.