Title: Do productivity incentives really equate to the increased work performance of employees?

Authors: Ricardo L. Dizon; Melcah P. Monsura

Addresses: Department of Economics, Polytechnic University of the Philippines, Anonas Street, Sta. Mesa, Manila, Philippines ' Department of Economics, Polytechnic University of the Philippines, Anonas Street, Sta. Mesa, Manila, Philippines

Abstract: The salary increase and the reward and recognition system were implemented to encourage productivity among workers by granting monetary and non-monetary rewards. However, uncertainties arise regarding the effectiveness and impact of these actions on driving higher employee performance. Hence, this study provided an analysis to address the issue of whether the implementation of the said system is a sufficient driver of employee performance. This study used a quantitative research design employing both descriptive in presenting the behaviour of the variables and inferential to determine the existing relationship between dependent and independent variables. The results of the study revealed that the implementation, as represented by explanatory variables such as performance-based incentives, real wage, interaction effects of performance-based incentives, and dummy variables of implementation, can statistically influence employee performance rating. Thus, it is recommended that policymakers of rewards and compensation systems must strengthen performance-based entitlement.

Keywords: employee performance; performance-based incentives; real wage; labour productivity; work performance; panel regression; monetary rewards; non-monetary rewards; quantitative research; compensation.

DOI: 10.1504/IJBG.2021.10038061

International Journal of Business and Globalisation, 2021 Vol.28 No.1/2, pp.64 - 76

Received: 13 Dec 2018
Accepted: 20 May 2019

Published online: 27 May 2021 *

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