variable-pay

Vocabulary Word

Definition

'Variable pay' is a portion of an employee's compensation that changes based on performance criteria. Unlike a fixed salary, it can increase or decrease depending on different factors such as work outcomes or profits.

Examples in Different Contexts

In non-profit organizations, 'variable pay' can be used to incentivize fundraising. A development director might announce, 'Your variable pay is tied to the success of our fundraising events.'

Practice Scenarios

Scenario:

We need to consider motivating strategies to encourage better work performance. An innovatively structured pay model could be a step in this direction.

Response:

I like the idea. We could incorporate a variable pay system that rewards both individual and company-wide achievements.

Startup

Scenario:

Our company's overall growth looks promising this year. We should reflect this progress in our employees' compensation plan.

Response:

That's a great option. A variable pay tied to the company’s growth might motivate our team to strive harder.