Wairarapa employees are missing out on performance-based pay because many small local businesses do not understand how to implement the schemes, an HR director says.
New Zealand employees would be more productive if their pay was tied to performance and they could work more from home, a new survey has found.
The Kelly Global Workforce Index surveyed more than 120,000 employees in 31 countries - including over 3500 Kiwis - and found we had one of the lowest levels of performance-based pay in the Asia Pacific region.
Director of Wairarapa-based HR firm Boss Group, Leanne Walsh, said while some local companies thought they paid for performance, "to be successful it has to be quite transparent".
While it was easy to measure black and white numbers, it was harder to measure how someone dealt with clients and other staff.
Key Performance Indicators were a good way to measure performance. However, people were notoriously bad at writing them and many roles did not suit them, she said.
"If you're answering the phones, you can answer it 100 per cent - you can't invent a whole pile of calls - so how do you increase your productivity?"
Many small business owners also found it hard getting their heads around how to implement performance pay, she said.
The latest Statistics NZ figures show the median weekly income for those in paid employment in the Wellington region was $850 a week - above the national median of $800.
Wairarapa-specific figures were unavailable.
The survey found that just over a third (36 per cent) of Kiwi workers had a portion of their pay tied to individual performance or productivity targets.
Nearly 60 per cent of employees in the Asia Pacific region had some form of performance-based pay.
However, half of Kiwi employees not currently receiving performance pay said they would lift their performance if their earnings were linked to achievement or productivity.
Kelly Services NZ spokeswoman Wendy Hewson said it was clear from the survey that more local businesses could achieve greater levels of productivity if they introduced some form of performance pay.
The survey also found while only a quarter of the workforce spent at least one day a week working from home, those who did believed they were more productive. Respondents said key benefits included minimising the time and expense of commuting and working with fewer interruptions - resulting in greater focus and productivity, and more flexibility to deal with unexpected personal requirements.
Disadvantages included the loss of opportunities for collaboration and networking, a feeling of isolation from colleagues and managers, and reduced access to company information and involvement.
A third of employees who worked from home also said they worked longer hours and took fewer breaks.
Public Service Association national secretary Brenda Pilott said performance pay was presented as a way to reward effort and lift performance in local and central government during the late 1980s and'90s - but it didn't work because the work was not profit-driven. APNZ