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American Multinationals in EuropeManaging Employment Relations Across National Borders$
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Phil Almond and Anthony Ferner

Print publication date: 2006

Print ISBN-13: 9780199274635

Published to Oxford Scholarship Online: September 2007

DOI: 10.1093/acprof:oso/9780199274635.001.0001

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Pay and Performance

Pay and Performance

Chapter:
(p.119) 7 Pay and Performance
Source:
American Multinationals in Europe
Author(s):

Phil Almond (Contributor Webpage)

Michael Muller-Camen

David G. Collings

Javier Quintanilla

Publisher:
Oxford University Press
DOI:10.1093/acprof:oso/9780199274635.003.0007

This chapter analyses the management of pay and performance in the case study companies, against the background of the embedded systems of the USA and the host countries. Both wage classifications and the issue of performance management are examined. Patterns of decision-making on both dimensions are found to be generally more centralized than is the case for other areas of HR policy. On the issue of wage classifications, patterns of broadbanding are examined, as well as the means by which US multinationals challenge sectorally-based pay determination in Germany. It then explores the issue of forms of individual and collective performance pay, looking at recent changes in the nature of merit pay, particularly the increasingly competitive nature of its allocation through mechanisms, such as forced distributions. It also reviews the extent to which performance management is used as a tool to ‘cull’ weaker performers, and suggests that the origins of such policies can be related to the societally-specific norm of ‘employment at will’.

Keywords:   pay determination, job classification, broadbanding, performance-related pay, forced distributions, centralization, work organization, employment at will doctrine, US multinationals

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