The Snitch

We’ve been hearing all the terrible news in lieu with the economic downturn but thankfully, a survey by Hay Group has unearthed statistics that should inject a fresh dose of hope that things are really not all bad.

More than 2/3 of Singapore companies surveyed have decided not to cut back on 2008’s bonuses, incentives and profit sharing. Sixty-five percent of respondents are also on track in meeting their 2008 targets and best of all, they are paying their high performers 60% more in base salary increases than to their other employees.

This leads to the question – what about the bulk of us who aren’t top performers?

The survey determined that primary concerns of organisations include retaining and recruiting top talent and employees with critical skills. This is simply because top performers make a much bigger impact to the companies as a whole, in comparison to the average employee. Companies cannot afford and do not want to lose top performers in any way, be it physically (get poached, resigned) or mentally (becoming demotivated and disengaged).

Hence, while the number of companies which has decided to freeze or decrease salaries has actually doubled from 41% to 83.4% in the past eight months, amount payable for bonuses will remain untouched for now.

According to Christian Vo Phuoc, country manager for Hay Group’s Reward Information Services Singapore, companies are generally wary about cutting incentives and bonuses as it is a reward to employees for their past year’s performance. As bonuses are already accrued for during the year, Vo Phuoc says, “It is more financially prudent for companies to pay out bonuses than salary increases which will immediately impact next year’s bottom-line.”

Most importantly, employees who have consistently performed well should not fret as more companies in Singapore are increasing their investments to retain their high-performing employees. The year 2009 will be all about performance management, as companies begin to clearly define the line between top and poor performers.