Civil servants' wages often represent the largest portion of government expenditure, and they are a key element in human resource management. The breakdown of the various components (fixed vs. variable), pay rise methods and what part individualisation plays are all indicators that allow governments to determine wages’ policy and how much room for manoeuvre they have in public finances.

A recent OECD study presents the range of compensation policies and focuses on the share of wage linked to performance. This trend is growing and today concerns a majority of countries (80%).

The author notes the difficulties in comparing national systems, which are affected by public service models (career-based or position-based) and reflect the way in which governments transpose and adapt private-sector practices.

A PBP implementation index[CM1] has been assembled. It takes several criteria into account, including whether such a mechanism exists and which categories of staff it concerns, the share of ancillary remuneration and the impact on career development.

Employing significant incentives that can reach 40% of compensation (combining one-off bonuses and salary increases) and that include most members of staff, both Denmark and Japan use PBP as a genuine management tool.

For several years after it was rolled out in Italy (on an individual basis), RFP met with strong resistance. In early 2018, the government decided to introduce a hybrid model that combines individual and collective performance.

In 2017, following the recommendations of the Hutton report, the British government introduced a dual system of additional compensation, which is linked to an employee's performance of his or her duties on the one hand, and to one-off contributions on the other, which makes it possible to enhance the value of work done as part of projects.

In Switzerland, PBP is individualised but is not a bonus. Assessment-based percentage increases are granted, allowing staff to advance more quickly within the pay grid.

By 2017, only 11 out of 35 countries had permanently eliminated automatic seniority-based advancement.

For more information: oecd.org