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Do merit-based cultures really work?

Telma Le Guen

Merit-based workplaces aim to reward employees for their performance, skills, and effort. 


In theory, it sounds fair, but there are common issues to consider:


◾ Needs Strong Performance Management: Without a clear system to track performance, merit pay isn’t effective.

◾ Conflicts with Seniority: If your company values seniority, it may clash with a merit-based approach.

◾ Focuses on Individual Over Team: Merit pay rewards individuals, which can be a problem if teamwork is a key value.

◾ Discourages Average Performers: Employees who don’t qualify for high raises may feel demotivated.


Plus, assuming everyone starts at the same level isn’t realistic. 


Factors like socio-economic status, gender, education, disabillity and race affect opportunities. 


Bias, whether intentional or not, can turn a merit-based system into one that deepens inequality.

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