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Human Resource & Change Management Consultants New Zealand

Performance Based Reward Systems

Performance based reward systems tend to focus more on the company point of view. Such systems must be efficient and the design should contribute to improved company productivity and savings.

Fairness as it applies to employees is seen as entirely different and relates to the way that rewards are distributed to employees. This is known as “distributive justice” and relates to how an employee views the amount of rewards received as fair. Employees are more concerned about the fairness of procedures used to determine the amount of reward received. Research carried out in the US suggests that reward satisfaction depends more on the procedures used to determine the rewards rather than the actual amount distributed.