| In the past decade, the companies in China thrived with the macro economy of China. More companies realized the importance of human resources management, especially the remuneration management system. It directly influences the ability of a firm to attract the talent from outside and retain and motivate the talent within the firm. Ever since the 1970s, the total remuneration management, also known as the overall remuneration management represented by "employee shareholding", "share incentive", "wideband salary" become popular and is set to be the mainstream in the common practice.In the total remuneration system, the variable pay is the one that has been most widely adopted. It's the most fundamental but also the most effective means of remuneration management. However, due to the lack of the data or probably the interest in this field, domestic studies focus on the introduction of the mature practice and trend from abroad.So with reference to some classic Personnel Economics papers, the author demonstrates how the output-based/input based discrete/continuous variable pay functions differently from a theoretical viewpoint by economic analysis and mathematical deduction.Then, the author conducts an empirical research via SPSS on over 160 companies and 50000 employees' remuneration data. By correlation, partial correlation and regression analysis, the relationship between the variable pay and factors such as age, educational background, rank, function is established on individual level. On corporate level, the author proves that the amount of basic salary and the variable bonus are positively correlated with the turnover rate while the other components don't have a significant influence. In addition, the internal dispersion of the bonus also affects the turnover. All the data in this research comes from the data collected from corporate HRs while the author interned in a HR consulting firm.Through study and analysis of over 50000 samples, the author reveals the role of the variable pay in the total remuneration system and the current practice in this field. Finally, the author provides some practical suggestions and solutions to better utilize the variable pay policies based on the data analysis. |
