Enough of the "Just Pay Them Fairly Instead of For Performance" Advice. Please.

Pardon the rant, but could those of you advising that we cease our useless efforts to "pay for performance" and instead simply "pay people fairly" please stick a sock in it?

Fairness is in the eye of the beholder, my friend.  Fact is, many employees do not believe that they are being paid fairly if their compensation disregards either their personal performance contributions or the performance of the organizational unit at which they are directing their discretionary effort.  I've spent a lot of time in discussion with employees who are paid within the constraints of so-called "fair" compensation programs which don't allow for performance differentiation at any level or in any manner.  They aren't necessarily happy campers, least of all those busting tail in an effort to excel.

Perhaps I am missing some intended irony in your advice, but I grow weary of hearing the same silly point about fairness repeated.  There are likely some very sound arguments against and counters to performance-based pay, but this is not one of them.

Thanks for listening.

Comments

[Darcy]

Amen. When I worked for a unionized school district and everyone received their pay raises based on time in position; a young lady told me once during her review that she didn't need to work any harder because she knew that a young man working there made more than she did even though he didn't work as hard simply because he'd been there longer. So in her mind, the pay wasn't "fair" because it wasn't based on performance.
I don't know any compensation professionals who advocate paying people unfairly.

[Frank Roche]

Amen, Ann. Shove a sock in it. LOL.

[Ann Bares]

Darcy and Frank:

Thanks for validating my rant. :)

[Kelly]

Amen sister! (Obviously, I'm not the only one thinking this...I laughed when I saw the posts that preceeded mine)

[Kim Bruning]

Perhaps your point is tangential to this, but just to be sure: People *are* saying that paying for performance actually negatively influences performance, in certain sectors. http://www.youtube.com/watch?v=u6XAPnuFjJc .

[Ann Bares]

Kelly:

I had the same experience. Now I feel less alone...

Kim:

Appreciate the thought and the link, but I think we've discussed the Drive/Dan Pink thing to death here and in other blogs (although I will admit I like the animation in this video, which has been making its way around for weeks now...). People certainly *are* saying that (and have been, back to the Alfie Kohn days, and long before that too...) - and while Mr. Pink makes some important and noteworthy points, the lion's share of the evidence that's been trotted out in condemnation of paying for performance reflects very poorly conceived plans and approaches. I am the last person to suggest incentives as the solution to all our ills; in fact, I probably hold the world's record for compensation consultants talking clients out of "pay for performance" schemes - but some of the arguments making their way around the interwebs these days on this topic just make my head hurt. Sorry.

[Brian Jeffrey]

Bravo! Good rant, well said.

I'm always amazed that it seems to be the under-performers who feel that the compensation they are receiving is unfair.

[Ann Bares]

Brian:

Thanks for the comment!

[Derek Irvine, Globoforce]

Brian took the words out of my mouth. There's quite a bit of research that shows habitual underperformers or the less skilled are the least likely to acknowledge or even understand that they are underperforming and are less skilled. We can never forget the impact of "human nature."

[E James (Jim) Brennan]

"Fair pay" tends to translate into "more pay." As famously and repeatedly said, "Everyone want to be paid exactly what they are worth, as long as it's more than they're currently getting." Half of every group is paid below normal (median) and half also perform accordingly; would that the two groups always stayed identical.

[Ann Bares]

Great points, Derek and Jim. Begs the question: Who gets to define "fair"?