Is an input-based payment system in which employees receive increases in pay for undergoing training and adding to their range or depth of skills. Schemes are often based on a modular training programme (which may itself be linked to a National Vocational Qualification) which enables employees to acquire a series of work-relevant skills. The reward typically takes the form of progression through an incremental scale with the successful completion of each unit of training leading to an enhanced salary or hourly rate. Skill-based pay is most commonly applied to manual or technical workers and is associated with forms of work organization, like teamworking, which require functional flexibility. In the United States, skill-based pay is often referred to as pay-for-knowledge. [See paying the person.]
Subjects: Human Resource Management.