Increasing trend towards gainshare plans in manufacturing

Increasing trend towards gainshare plans in manufacturing

More and more manufacturers are adopting gainsharing plans, where unit performance is assessed against key performance indicators such productivity, safety and quality, according to a survey by consultants William M Mercer.

The survey found that three-quarters of sites offer at least one type of cash bonus scheme.

The vast majority of sites have variable bonuses that are subject to performance criteria . . .

Source: Manufacturing and Logistics Pay and Benefits Survey Report 2001, William M Mercer.

Pay disclosure

• As companies move towards flexible pay structures, there is increasing demand for pay transparency. Employees want to feel they are being fairly rewarded, and need to understand how their pay levels are determined. — Mark Goodlake, European Partner at William M Mercer.

• Two-thirds of participants (65%) publish information that explains the company's grading structure.
  

• As many as a fifth (22%) provide employees across the company with information on pay ranges for all grades and positions in the organisation.
  
• Over half (56%) only inform employees of the pay range covering their individual position.
  
• A further 22% do not provide any information on pay ranges at all.
  
  

Changes to pay structures

The research suggests that pay structures are under review across the manufacturing sector Just over half of respondents (52%) are intending to change their banding structure. Why then are so many manufacturers overhauling their pay structures? The survey responses gathered by William M Mercer point to three main factors:

• to align grading structures with a flatter organisation (30% of respondents)
  

• to simplify administration (30%)
  
• to support organisational flexibility (17%).
  
  

Want to know more?

Title: Manufacturing and Logistics Pay and Benefits Survey Report 2001, William M Mercer.

Survey sample: Mercer examined pay, benefits and employment conditions for 7,148 employees in 14 manufacturing and logistics organisations across 23 sites in the UK.

Business sectors: The survey covers companies involved in the manufacture and distribution of a range of items from electrical goods to food. Annual turnover in the participant companies ranges from £ 5 million to over £ 1,000 million.

Availability: Contact Jo Wear at William M Mercer, tel: 01753 848029.

William M Mercer is one of the UK's largest human resource and employee benefits consultancies, employing over 3,500 consultants and support staff in 19 offices. To find out more jump to . . .

www.wmmercer.com/uk/english/index.html

Posted 7 September 2001