Incentive Scheme Design

Incentive Scheme Design

Short-Term Incentive schemes (STI’s) and Long-Term Incentive schemes (LTI’s) are typically used to reward and retain certain categories of staff, and/or superior performers. Typically, performance of either the individual / company, or both, would determine the eligibility, quanta and mechanics of the incentive scheme, and should of course be linked to the performance. The schemes could be paid annually or over a longer period of time, dependent on the behaviours the organisation wishes to drive.

There are a number of types of incentive scheme: performance bonus, gain share, profit share, deferred cash, share options etc. Each scheme designed by Emergence Human Capital is carefully considered, designed, modelled & tested, and is aimed at driving the results and strategic objectives of the organisation.

Short-Term Incentive Scheme Design

Short-Term Incentive schemes (STI’s) are typically used to reward and retain certain categories of staff, and/or superior performers. STI’s form a critical component of the Total Remuneration component of the pay mix, and is a common element in a well-established total rewards model. It is typically allocated/paid in addition to guaranteed pay. STI’s are the most common incentive type as it is a short-term goal that is set (up to 1 year), and can drive behaviour immediately and effectively for most categories of staff.

Long-Term Incentive Scheme Design

Long-Term Incentive schemes (LTI’s) are typically used to reward and retain certain categories of staff and/or superior performers. LTI’s form a critical component of the Total Earnings component of the pay mix, and is a common element in a well-established total rewards model. It is typically allocated/paid in addition to guaranteed pay and any form of short-term incentives.

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