What Are the Different Remuneration Models?

Remuneration is various forms of remuneration or appreciation received by employees for providing labor or services to their units. Compensation model refers to the composition of compensation and its combination.

Salary model

In summary, there are five main reasons for remuneration, and five types are formed accordingly.

The compensation model of the competence center and the performance model can be collectively called the people-centered compensation model. They are all based on human behavior and performance.

No compensation model is perfect, and no compensation model is worthless. Different organizations, different personnel, and different jobs should apply different pay models. The organization's compensation strategy will be more flexible to meet the requirements of the new operating environment. In the 1990s, although 70% of the world's top 500 companies mainly adopted the compensation model of job centers, 50% of the companies implemented a competency center compensation policy for at least some of their employees, and 14.6% of the companies implemented performance centers Performance pay system.

The future of the compensation model will be an era in which the people-centered compensation model and the position-centered compensation model complement each other and develop together. The single compensation model will be replaced by the compound compensation model. ^[1]