Employee incentives: bonuses or penalties?
Firms regularly use incentives to motivate their employees to be more productive. However, often little attention is paid to the language used in employment contracts to describe these incentives. It may be more effective to present incentives as entitlements that can be lost by failing to reach a p...
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| Format: | Article |
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IZA
2016
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| Online Access: | https://eprints.nottingham.ac.uk/32652/ |
| _version_ | 1848794458934476800 |
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| author | Nosenzo, Daniele |
| author_facet | Nosenzo, Daniele |
| author_sort | Nosenzo, Daniele |
| building | Nottingham Research Data Repository |
| collection | Online Access |
| description | Firms regularly use incentives to motivate their employees to be more productive. However, often little attention is paid to the language used in employment contracts to describe these incentives. It may be more effective to present incentives as entitlements that can be lost by failing to reach a performance target, rather than as additional rewards that can be gained by reaching that target. However, emphasizing the potential losses incurred as a result of failure may entail hidden costs for the employer, as it may damage the trust relationship between a firm and its employees. |
| first_indexed | 2025-11-14T19:16:31Z |
| format | Article |
| id | nottingham-32652 |
| institution | University of Nottingham Malaysia Campus |
| institution_category | Local University |
| last_indexed | 2025-11-14T19:16:31Z |
| publishDate | 2016 |
| publisher | IZA |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | nottingham-326522020-05-04T17:30:05Z https://eprints.nottingham.ac.uk/32652/ Employee incentives: bonuses or penalties? Nosenzo, Daniele Firms regularly use incentives to motivate their employees to be more productive. However, often little attention is paid to the language used in employment contracts to describe these incentives. It may be more effective to present incentives as entitlements that can be lost by failing to reach a performance target, rather than as additional rewards that can be gained by reaching that target. However, emphasizing the potential losses incurred as a result of failure may entail hidden costs for the employer, as it may damage the trust relationship between a firm and its employees. IZA 2016-01-26 Article PeerReviewed Nosenzo, Daniele (2016) Employee incentives: bonuses or penalties? IZA World of Labor, 2016 (234). ISSN 2054-9571 employee motivation bonuses penalties loss aversion contract framing http://wol.iza.org/articles/employee-incentives-bonuses-or-penalties doi:10.15185/izawol.234 doi:10.15185/izawol.234 |
| spellingShingle | employee motivation bonuses penalties loss aversion contract framing Nosenzo, Daniele Employee incentives: bonuses or penalties? |
| title | Employee incentives: bonuses or penalties? |
| title_full | Employee incentives: bonuses or penalties? |
| title_fullStr | Employee incentives: bonuses or penalties? |
| title_full_unstemmed | Employee incentives: bonuses or penalties? |
| title_short | Employee incentives: bonuses or penalties? |
| title_sort | employee incentives: bonuses or penalties? |
| topic | employee motivation bonuses penalties loss aversion contract framing |
| url | https://eprints.nottingham.ac.uk/32652/ https://eprints.nottingham.ac.uk/32652/ https://eprints.nottingham.ac.uk/32652/ |