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Largely because performance based pay does not have a fixed upside. Contrast this with a salary band which does have a fixed maximum.
by peytoncasper 5y ago
Largely because performance based pay does not have a fixed upside.
Contrast this with a salary band which does have a fixed maximum.
- joshuamorton 5y agoBoth of these can be false (or mostly false). For example at most big firms, performance based comp has a known upside. Something like your bonus is x% of your salary multiplied by some performance indicator based on your eval, and the max is like 2x or something. Similarly, salary bands can have soft caps, where growth becomes harder as you're further from the minimum, but never becomes impossible. Neither approach is necessary better, but all are used in different places.