New Pay: Developing Reward Management For Employees

The term new pay is used to describe the various new systems that are being followed

and researched by different organizations, for paying their employees. These methods or systems are generally known as reward management systems.

The reward management systems are developed for understanding the factors that would motivate an employee to work willingly with compassion. These factors include the salary, bonus and other types of material rewards or non-material rewards which help the organizations in escalating their effectives.

The reward that is given to an employee for their excellence in work can be in many forms. For the purpose of understanding, we can put them in two different categories:

Monetary Rewards for Employees: Any reward that is in the form of currency like cash, money order, cheque or ready money like vouchers and gift cards can be considered as monetary rewards.

Non-monetary Rewards for Employees: Any reward that is given to an employee in the form of non-material rewards like banquet, free trips or material rewards like trophies, mugs, desk items and clothing items like shirts, caps etc are regarded as non-monetary rewards.

These rewards are given generally by a company to an employee for two reasons. First, it appreciates the hard work done by the particular employee and second, by giving the reward the company aims to encourage that employee along with the others to continue performing well. It is in the human nature to perform better when their work is appreciated and awarded accordingly.

Let us now take a brief look at the importance of new pay strategies.

It helps in improving the overall effectiveness of an organization.

It helps in motivating the employees to increase their level or quality of their performance.

The employees remain loyal to the company when their performance or work is rewarded properly. This also gives the employees the will to put their effort in the work.

A level of competence develops between the employees when such reward management systems are followed.

Research has proven that organizations that decide to follow new pay strategies or reward management system get a better edge over the competing organizations that do not follow any such system. So we can conclude that for an organization to grow along with its employees, it should opt to follow new pay strategies.

by: kellyprice1225

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