Incentive pay

Definition

Incentive pay is additional compensation awarded to employees for achieving defined performance targets or exceeding their job responsibilities. It is designed to motivate and reward employees for their contributions towards the organization's success.

Related terms

Performance Bonus: A financial reward given to employees based on their work performance, often assessed through regular evaluations.

Commission: A type of incentive pay where employees earn a percentage of the sales they generate, commonly used in sales roles.

Profit Sharing:

A program where employees receive a share of the company’s profits, recognizing their contribution to the company's success