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 tech startups, 'variable pay' is common to attract talent while managing budgets. A CEO might explain, 'We offer competitive variable pay to reward high performance and innovation.'

Practice Scenarios

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.

Tech

Scenario:

In today's meeting, we should discuss additional incentives for the team members who are consistently stepping up in their roles.

Response:

I agree. Perhaps adding a variable pay portion based on project completion could provide that extra incentive.