Pre course assignment 2: Performance Related Pay The assignment is to write a paper about Performance Related Pay (2000 words) Performance Related Pay is receiving a great deal of attention. On the one hand (collective) labour agreements are increasingly including arrangements that relate to pay-forperformance, at the same time there is also strong resistance. Trade unions have never been enthusiastic proponents subject to certain conditions, but opinions are also divided in employers' circles. Pay-for-performance is even named as a root cause for the crisis of the financial sector and for the collapse of some companies. A number of companies have recently announced that they will abolish or change their pay- for-performance systems. When organizations have performance related pay systems in place, (front line) managers usually play an important role. They make pay decisions, or provide information for these decisions. The paper is also a preparation for a class debate about pay for performance in the fourth lecture. The debate will be about the statement: “The introduction of individual pay for performance contributes to an improvement in a company's (financial) performance” The paper will be written from one of three starting points: 1. You are against the statement: all arguments you discuss should underpin that the statement is false 2. You are in favour of the statement: all arguments you bring forward should underpin that the statements is true 3. You are undecided: find balance in the arguments against and in favour of the statement. Start your paper by stating which starting point you have chosen. About 25% of your arguments should be based on your own experience with (the lack of) individual incentive or performance related pay systems. Another 50% of your arguments will be based on arguments which are taken from the textbook or reader (at least use motivation theory which you find in the reader (article of Kreitner e.a) and the chapter 3 and 7 in the HR textbook (Henderson) . Jack Welch’s ‘Winning’ contains interesting remarks on the issue. The last 25% of your arguments can be taken from any other source (academic journals, popular journals, newspapers, websites and on) The scorecard for this assignment:  The quality and quantity of arguments from reader and textbooks (40% of the grade)  The quality and quantity of the arguments based on personal experience (20% of the grade)  The quality and quantity of the arguments based on other sources (20% of the grade)  Care in citing (library guidelines) (10% of the grade)  Style (10%) Submission: Bring a hard copy of your assignment to first lecture of the HRM course at July 17 2011 14.00. Upload your assignment also via the portal (soft copy) using the same deadline.