Productivity bonus schemes and output bonus schemes are mainly used in manufacturing, e.g. piecework (where employees are paid according to the number of pieces or units they produce ), but is being used increasingly in other sectors e.g. to measure the time taken from receiving details of a job to completing it. In this type of circumstance of course, good productivity also equates with good.
For example, cash in the bonus bank can be increased in year two if performance is good, and reduced if it is disappointing. This reduction is known as a malus. This is the approach UBS has adopted for both cash and shares. Its scheme measures risk-adjusted performance over a longer period. At the end of that period, a maximum of one-third of the cash part of reward will be paid out. The rest.
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Whether used proactively to influence behaviour or retrospectively as part of a reward package, bonuses and incentives can have various benefits for organisations and employees. The success of any bonus or incentive scheme, however, is based on an understanding of the context in which they operate and an appreciation of how individuals may respond differently to the same stimulus.Read More
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Bankers' bonuses are traditionally paid or awarded to some workers in the finance industry at the end of the bank's financial year. They are intended to reward employee behavior during that year that has increased the profits of the bank or some relevant part of its business, as shown by the annual accounts.The bonus culture is usually associated with the investment banking divisions.Read More
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