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Pay for Performance

APS designs and develops pay for skills and pay for performance programs for plant operations and maintenance positions. 

Pay for Skills, Pay for Performance, Pay for Knowledge are three phrases that refer to performance-based reward systems that are replacing seniority-based reward systems as the demand for more a knowledgeable, more highly skilled, and more flexible work force increases.

As jobs change and become more complex, employees have to acquire the knowledge and skills needed to perform these jobs to move forward as their companies move forward. As a result, many companies are beginning to provide continuing and upgrade training and they are restructuring outdated apprentice programs. As jobs change and training is provided, companies are linking the acquisition of job knowledge and job skills to pay for performance systems designed to stimulate employee growth and development.

However, pay for performance systems must be carefully planned and implemented because they are governed by the provisions of 41 Code of Federal Regulations, Chapter 60, Part 60-3, Uniform Guidelines on Employee Selection Procedures. As is noted in the Code, "These employment decisions include but are not limited to hiring, promotion, demotion, membership (for example, in a labor organization), referral, retention, and licensing and certification, to the extent that licensing and certification may be covered by Federal equal employment opportunity law. Other selection decisions, such as selection for training or transfer, may also be considered employment decisions if they lead to any of the decisions listed above."

When these employment decisions involve any type of testing, both written and performance tests, these tests must be valid and meet the criteria established in the Standards for Educational and Psychological Testing. To ensure the tests are valid, they must be based on a thorough job and task analysis (JTA). Written tests that assess the employee's acquisition of job knowledge are derived from the learning objectives that are themselves derived from the knowledge requirements identified during the job and task analysis. Performance measures that assess the employee's acquisition of job skills are derived from the skill requirements identified during the job and task analysis.

Additionally, those responsible for assessing employee performance must be trained so that performance appraisal is consistent and unbiased. Accurate records of performance appraisal must be maintained.

If you are interested in implementing a pay for performance system, APS can assist you in meeting the requirements of the Code of Federal Regulations. We can help you develop policies and procedures that ensure a smooth implementation of the program, conduct a job and task analysis to identify skill and knowledge requirements, develop evaluation tools, and train your personnel to be performance evaluators.

For more information, email us at info@aps-online.net or call Greg Pancerev at 610-987-4054

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