A case study on the performance related pay system within Abbey Ireland Ltd. and an evaluation of the effectiveness of the system

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Brennan, Michelle
Issue Date
BA (Hons) in Human Resource Management
Dublin Business School
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The purpose of this study is to review the performance related pay (PRP) system in operation within Abbey Ireland Ltd. and to consider if the objective of the process is being achieved. It is also intended to review the opinion of the employee's within the organisation through the use of a questionnaire to validate if the system is effective. Some view performance pay related systems as a de-motivator, and it is suggested by some that these systems do not work and people mistrust them. However, it is firmly believed that the performance related pay system works within the organisation and satisfies the majority of the employee population. Within the context of this report it is intended to evaluate this system and make appropriate recommendations if required. The initial introduction to the process followed within Abbey Ireland Ltd. showed the process to be comprehensive and somewhat complex. At the end of the study, it was found that the process was comprehensive as the system is used in each of the business units. This necessitates the need to accommodate all intricacies of the organisation and to ensure that the process is applied in a fair and equitable manner throughout the organisation. Of the employees surveyed, 62% either agreed or strongly agreed with the statement that they believed that the outcome of the review process accurately reflected their job performance. With 2.5% not answering the question, 15% were neutral and 20% either disagreed or strongly disagreed with the outcome, it appears that the majority of the population are aware of the importance of the process and are mainly satisfied with the system. Also, shown in the questionnaire is the high level of awareness of the appeal system and the confidence that the system can be used in confidence. It is also reassuring to the employees to see that senior management will overturn a decision if it is believed that the incorrect decision regarding an individual's performance was made. This is supported by the data of performance related appeals within the organisation which were overturned on appeal, a total of 65 cases were opened, of these 24 were performance management related, of which 51 % were either changed or partially changed. It also supports the result that 80% of the population appear to be happily employed within Abbey Ireland Ltd. In conclusion, having reviewed leaver reasons, appeal's data and current employee data, the majority of employees do appear to be satisfied with the current system.