Based Pay 

Employees can be rewarded based on the necessary skills that they get and that help in company growth. IRS 2003 has stated that this is becoming a norm in USA and UK. The method is followed in employees working in the technical department. The extension of this scheme would be taken to departments where skill acquiring would help a company grow.

Employees would get motivated to get new skills, and this would benefit the organization as it becomes less expensive. Rewarding employees would happen in another form of retaining employees and employee would get a feel that they are preferred over others. Employees would get benefit once they finish the necessary skill sets. IDS in 1992 had done a study on this aspect. Companies like venture pressings have successfully done this scheme and employees would be rewarded if they successfully meet the aspirations of assessors.

National vocational qualification would be used well to get new skills for new employees and productivity should increase with skill sets. There may be cases in which company would have invested heavily on skill sets and would find that cost is on the higher side than the benefits accrued by an organization.

There are cases in which labor after acquiring necessary qualifications would go competitive labor market. Technology related industries should upgrade their skills faster else they would become obsolete. There are situations in which company would still pay a high amount for skills that are no longer required in the market. Rewarding skills would benefit the organization if skills really help a company stay afloat in the modern arena.

Skills-Based Pay 11

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