More than 50% of employees would give up a salary increase for bonus-related pay

Binnenlands Bestuur

'If you ask people whether they like their work, 70% says they do. It turns less optimistic if you ask concretely what happens to rewards and management in the workplace,' says Robert Dur, Professor of Economics of Incentives and Performances at Erasmus School of Economics, following WERKonderzoek (working conditions survey) 2019. Dur argues that there should be more variety in rewards.

Performance-related pay

Dur previously announced that half of the employees in the public sector would not mind giving up part of their salary increase for a performance-related bonus. For employees up to the age of 45, this percentage is as high as 60%. According to Dur, this outcome should be followed by making remuneration more performance-related. ‘How exactly you would do that is still a puzzle,' says Dur. ‘We still need to take some steps there. Performance-related pay is attractive for people who perform better and those are the people you want to keep in your organisation. That's a favourable effect'.

Room for improvement

The survey also shows that 60% of the respondents are satisfied with their manager, and 1 out of 6 is very dissatisfied. ‘We asked them about this, and it turns out that only half of the respondents finds their manager inspiring, and half of them believes that their manager helps them to develop. Furthermore, only 50% thinks that their manager is going for the best result. So there is still room for improvement in that area’, says Dur.

Are managers too weak?

The survey also asked how poorly performing employees are dealt with. In the public sector, 1 out of 3 indicates that they are simply tolerated. In the market sector this is less: 1 out of 5. However, given that good performance in the market is more often linked to performance pay, and this is less often the case in the public sector, the difference in results is not that surprising. But given that it happens so often, can we say that managers are too weak? Dur finds it interesting to research how difficult managers think it is to act effectively. ‘One extreme measure is dismissal or reassignment. When I talk to managers in the public sector, most of them say: 'I'm not going that way, it's too difficult and too expensive.' But some people have gone down that road, and it turned out better than expected.’

Better assessment of performance

According to Dur, it all starts with better assessment of performance. Many organisations in the public sector are reluctant to look at how well things are going at the individual or team level. ‘If you do, you stick your neck out. You know your weaknesses and what you can do better. By collecting this data, you can gain valuable insights and take action. That could really improve the public sector.'

More information

The entire article from Binnenlands Bestuur, 19 September 2020, can be found here (in Dutch).