Friday, September 03, 2010

Base Percentage Pay

I think business pay structures should be set up so that all employees benefit from the success of the company. In this scenario all employees - from the cleaning crew to the CEO - would have their pay based on a percentage of the business profits. An employee who works above and beyond could be rewarded by advancing to the next higher percentage. And their title is not necessarily tied to their percentage.

As we know, sometimes a business can struggle through a hard time and might not have profits for a period. This is why all employees would also have a base salary that would be guaranteed. During these hard times the employee would only get their base salary. But when the business returns to a profitable period, all the employees would again benefit by an automatic pay raise based on their percentage pay level. This is why I call this the Base Percentage pay structure. It's sort of like a commission - but for everyone.

Imagine the motivation of every single person to have their company succeed! Success in the business means added success in the paycheck - for everyone. Why limit the financial motivation to only the sales team? What works for them can work for the entire company! I don't know why every business isn't run this way.

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