When it comes to compensation, every company has a way of acting, however, those wishing to boost business and recognize employee’s good results should adopt a meritocracy system, which allows for variable pay. This is the guidance of Carla Martins, vice president of SERAC, a hub of corporate solutions, being a reference in the accounting, legal, educational, and technology areas.
According to Carla, compensation is an important tool for employee retention in any company, but it can be used to enhance some objectives, such as recognizing employees’ work and reducing turnover, contributing to team retention. “The company can adopt a monthly and annual meritocracy system, involving recognition in money and compliments, just establish some criteria and reward those who achieved the best results,” she suggests.
At SERAC, according to the executive, the monthly prize is given in cash, directly to the employee. “We believe that giving money in hand is like giving a gift. It’s different from a gift card or receiving directly in the account, where the money ends quickly. And, apart from the money, we compliment the person’s performance publicly, thus recognizing in both ways,” Carla Martins says.
Annual remuneration, according to the SERAC vice-president, should have a greater prize than the monthly one, and it can involve the whole company and not be divided by areas or departments. ‘Everything depends on the size of the company and the required deliveries. In our case, we chose to establish criteria related to culture in the annual meritocratic reward. For example, we observe how people absorb our culture, how they treat other employees, and how they are perceived by them,’ she explains.
For Carla Martins, meritocracy is an interesting tool because it helps the organization grow consistently concerning culture and employee retention. ‘The whole team becomes more engaged, and in the following month or year, a large part of the team starts striving to be among the top positions. This helps the company improve in terms of culture and generates a benefit not only for the winning employees but for the business itself. There are even people who win multiple times because they understand the rules of the game and practice them consistently,’ she evaluates.
At SERAC, the practice of meritocracy and variable remuneration started within the family and was enhanced and extended to employees. ‘Our managers, for example, receive 100% variable remuneration. Analysts receive a fixed part and another variable part, related to deliveries, behavior, etc.,’ explains Carla Martins.
