Dear all,
I work in an organization where performance appraisals and annual salary increments are considered as two separate activities.
I find this quite interesting and intriguing at the same time. This is probably the first company that I have come across practicing this.
I would request all members who have been working in Dubai or the UAE to shed some light on this matter. Is this a common practice in this market?
If it is, then some questions come to my mind:
1. What are performance appraisals used for?
2. What is the basis for suggesting a salary increment?
3. Who is responsible for proposing the increment figures - the HR team or the Business team?
4. If there is no linkage between the two, then how would a company justify performance pay for employees?
5. Are salary increments scientifically calculated based on company performance and general economic conditions?
I would greatly benefit from knowing what is happening in other companies in this market as my company is looking for information from other players in this market.
Regards,
Shailashree
From United Arab Emirates, Dubai
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2I work in an organization where performance appraisals and annual salary increments are considered as two separate activities.
I find this quite interesting and intriguing at the same time. This is probably the first company that I have come across practicing this.
I would request all members who have been working in Dubai or the UAE to shed some light on this matter. Is this a common practice in this market?
If it is, then some questions come to my mind:
1. What are performance appraisals used for?
2. What is the basis for suggesting a salary increment?
3. Who is responsible for proposing the increment figures - the HR team or the Business team?
4. If there is no linkage between the two, then how would a company justify performance pay for employees?
5. Are salary increments scientifically calculated based on company performance and general economic conditions?
I would greatly benefit from knowing what is happening in other companies in this market as my company is looking for information from other players in this market.
Regards,
Shailashree
From United Arab Emirates, Dubai
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Very interesting topic. I appreciate seeing our expert members' answers. Come on, let's make this section of Cite HR full of activities. There is a whole lot of HR life happening in the UAE.
Regards, Ramesh Menon
From United Arab Emirates, Abu Dhabi
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Regards, Ramesh Menon
From United Arab Emirates, Abu Dhabi
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Hello HR folks!!
I would highly appreciate any information on the topic above. Kindly share some of the practices in your organizations.
Hoping to get some information soon.
Regards,
Shailashree
From United Arab Emirates, Dubai
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I would highly appreciate any information on the topic above. Kindly share some of the practices in your organizations.
Hoping to get some information soon.
Regards,
Shailashree
From United Arab Emirates, Dubai
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Dear Shaila,
I have copied your email and below in blue tried, or rather attempted, to be precise and to the point.
I work in an organization where performance appraisals and annual salary increments are considered as two separate activities.
(Performance appraisals outcome is to decide on three things:
1. Probability of Promotion
2. Financial reward to motivate/Salary Increment
3. Departmental transfers/Ultimatums/Terminations)
I find this quite interesting and intriguing at the same time. This is probably the first company that I have come across practicing this.
Yeah...lots of companies have forgotten the real essence of performance appraisals. So when some company does it, it looks amusing. Whereas, in the first place, the objectives have to be made clear, for would we be having a personnel management activity or the real HR in practice.
I would request all members who have been working in Dubai or the UAE to shed some light on this matter. Is this a common practice in this market?
If it is, then some questions come to my mind:
1. What are performance appraisals used for?
The appraisal system gives each appraisee an idea of what is expected of him next year.
2. What is the basis for suggesting a salary increment?
Companies use numerous rewards, including non-financial ones, to motivate people. Rewards, be they monetary or non-monetary, are always objectively determined.
3. Who is responsible for proposing the increment figures - the HR team or the Business team?
Awards are used as a technique for motivating both the employee and his/her family. Salary increments come under financial rewards. Hence, motivating a workforce to get better work done and enhance capabilities is under the HR domain.
4. If there is no linkage between the two, then how would a company justify performance pay for employees?
The HR department is no other than a Business revenue-generating department. At the end of the day, you have to remember that the achievement of Business Objectives is the ultimate aim of every department as well as employees. HR functions work hand in hand with other departments seeking their valued inputs and suggestions.
5. Are salary increments scientifically calculated based on company performance and general economic conditions?
Yes, they are. There are many mediating companies that offer their services to assist you in doing the same.
Hope I am able to talk some sense.
Sajid
From United Arab Emirates, Dubai
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I have copied your email and below in blue tried, or rather attempted, to be precise and to the point.
I work in an organization where performance appraisals and annual salary increments are considered as two separate activities.
(Performance appraisals outcome is to decide on three things:
1. Probability of Promotion
2. Financial reward to motivate/Salary Increment
3. Departmental transfers/Ultimatums/Terminations)
I find this quite interesting and intriguing at the same time. This is probably the first company that I have come across practicing this.
Yeah...lots of companies have forgotten the real essence of performance appraisals. So when some company does it, it looks amusing. Whereas, in the first place, the objectives have to be made clear, for would we be having a personnel management activity or the real HR in practice.
I would request all members who have been working in Dubai or the UAE to shed some light on this matter. Is this a common practice in this market?
If it is, then some questions come to my mind:
1. What are performance appraisals used for?
The appraisal system gives each appraisee an idea of what is expected of him next year.
2. What is the basis for suggesting a salary increment?
Companies use numerous rewards, including non-financial ones, to motivate people. Rewards, be they monetary or non-monetary, are always objectively determined.
3. Who is responsible for proposing the increment figures - the HR team or the Business team?
Awards are used as a technique for motivating both the employee and his/her family. Salary increments come under financial rewards. Hence, motivating a workforce to get better work done and enhance capabilities is under the HR domain.
4. If there is no linkage between the two, then how would a company justify performance pay for employees?
The HR department is no other than a Business revenue-generating department. At the end of the day, you have to remember that the achievement of Business Objectives is the ultimate aim of every department as well as employees. HR functions work hand in hand with other departments seeking their valued inputs and suggestions.
5. Are salary increments scientifically calculated based on company performance and general economic conditions?
Yes, they are. There are many mediating companies that offer their services to assist you in doing the same.
Hope I am able to talk some sense.
Sajid
From United Arab Emirates, Dubai
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Dear Shaila Whats your input from any other sources ? you started the thread right ?? Sajid
From United Arab Emirates, Dubai
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From United Arab Emirates, Dubai
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Well commented, Sajid. However, let me give my humorous side of explanation/comments considering the socio-economic.
Let me also answer in between the question:
I work in an organization where performance appraisals & annual salary increments are considered as two separate activities. I find this quite interesting and intriguing at the same time. This is probably the first company that I have come across practicing this. I would request all members who have been working in Dubai or the UAE to shed some light on this matter. Is this a common practice in this market?
As far as my experience of working in the UAE is concerned, it is not unusual to consider the appraisals and annual salary increments as two separate activities. Salary increments happen in some companies in the month of April, effective January, and in some companies in January itself. Appraisals happen only in well-structured companies, mostly with their collaborating company or partners based in Europe, UK, US, etc.
It is due to the fact that the HR Department is not well-structured here (in most Middle East countries) and has several limitations regarding efficient staff. Mostly, you may see either Office Services or Administration personnel handling HR roles. This will deny the right structuring, career development opportunities, Training requirements, etc., which are very necessary for the growth of a company and its manpower.
If it is, then some questions come to my mind
1. What are performance appraisals used for?
Company objectives vary, and at times, especially if you come from a well HR-structured company, you may see Performance Appraisal as an opportunity to deny any well-deserved promotion/pay rise. However, it is not always the case. There are companies that follow correct policies and procedures to implement performance appraisal plans.
2. What is the basis for suggesting a salary increment?
This depends on several factors, again varying from company to company and the nature of its business and roots. Some companies have a fixed plan of increment for employees, based on different scales or ratios according to the nature and role assigned. Here again, many times, if you are a hardcore HR person transplanted to this part of the world, you may be forced to witness favored employees receiving maximum scores/increment allotment ratios beyond HR-prescribed levels, authorized by management above HR. Office boys, Personal Drivers, PROs, and close associates performing various tasks for key/top management executives fall into this elite category, which you may not be able to control or include in your measures or policies. However, I am sure this scenario is not unique to this region.
3. Who is responsible for proposing the increment figures - the HR team or the Business team?
In many cases, the company allocates a budget increment ratio or budget basket to the Business Team and other teams. They can propose their own percentage ratios for staff to HR for finalization and submission to management. Performance appraisals conducted by the Business Team are rated by the HR department, providing their evaluation to management to finalize this exercise.
4. If there is no linkage between the two, how would a company justify performance pay for employees?
This is also not an uncommon scenario. Many times we see a fixed amount interest or fixed percentage increase regardless of performance, as per company management decision. This may occur in industries with lower profit margins/growth rates, where managements are less inclined to discuss/listen to staff issues related to the rising cost of living, etc. As mentioned earlier, these factors are part and parcel of the local company situation and their vision for employee welfare connected to company growth. I have seen cases where increments as low as 150 Dirhams are approved even during times of escalated living costs, and occasionally high increments are approved two or three times in the same year.
5. Are salary increments scientifically calculated based on company performance & general economic conditions?
Many companies engage external consultants to assist in salary revisions based on economic conditions. Companies with roots outside the Gulf often have well-structured schemes aligned with their parent company's policies and international rules and regulations to determine employee benefits each year. These companies also set real-time targets and growth/profit margins, which are analyzed and discussed during appraisals. New objectives and key targets for the upcoming financial year are issued as per company policy at this time.
As you and many others realize, true HR practice still has a long way to go in this region, requiring significant efforts to make it a reality. I sincerely hope that interactions, useful discussions, knowledge sharing, etc., utilizing non-profitable Self-Help groups like Cite HR, will prove beneficial for implementing measures beneficial to staff in the future. Thank you for raising this topic.
Ramesh Menon
From United Arab Emirates, Abu Dhabi
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Let me also answer in between the question:
I work in an organization where performance appraisals & annual salary increments are considered as two separate activities. I find this quite interesting and intriguing at the same time. This is probably the first company that I have come across practicing this. I would request all members who have been working in Dubai or the UAE to shed some light on this matter. Is this a common practice in this market?
As far as my experience of working in the UAE is concerned, it is not unusual to consider the appraisals and annual salary increments as two separate activities. Salary increments happen in some companies in the month of April, effective January, and in some companies in January itself. Appraisals happen only in well-structured companies, mostly with their collaborating company or partners based in Europe, UK, US, etc.
It is due to the fact that the HR Department is not well-structured here (in most Middle East countries) and has several limitations regarding efficient staff. Mostly, you may see either Office Services or Administration personnel handling HR roles. This will deny the right structuring, career development opportunities, Training requirements, etc., which are very necessary for the growth of a company and its manpower.
If it is, then some questions come to my mind
1. What are performance appraisals used for?
Company objectives vary, and at times, especially if you come from a well HR-structured company, you may see Performance Appraisal as an opportunity to deny any well-deserved promotion/pay rise. However, it is not always the case. There are companies that follow correct policies and procedures to implement performance appraisal plans.
2. What is the basis for suggesting a salary increment?
This depends on several factors, again varying from company to company and the nature of its business and roots. Some companies have a fixed plan of increment for employees, based on different scales or ratios according to the nature and role assigned. Here again, many times, if you are a hardcore HR person transplanted to this part of the world, you may be forced to witness favored employees receiving maximum scores/increment allotment ratios beyond HR-prescribed levels, authorized by management above HR. Office boys, Personal Drivers, PROs, and close associates performing various tasks for key/top management executives fall into this elite category, which you may not be able to control or include in your measures or policies. However, I am sure this scenario is not unique to this region.
3. Who is responsible for proposing the increment figures - the HR team or the Business team?
In many cases, the company allocates a budget increment ratio or budget basket to the Business Team and other teams. They can propose their own percentage ratios for staff to HR for finalization and submission to management. Performance appraisals conducted by the Business Team are rated by the HR department, providing their evaluation to management to finalize this exercise.
4. If there is no linkage between the two, how would a company justify performance pay for employees?
This is also not an uncommon scenario. Many times we see a fixed amount interest or fixed percentage increase regardless of performance, as per company management decision. This may occur in industries with lower profit margins/growth rates, where managements are less inclined to discuss/listen to staff issues related to the rising cost of living, etc. As mentioned earlier, these factors are part and parcel of the local company situation and their vision for employee welfare connected to company growth. I have seen cases where increments as low as 150 Dirhams are approved even during times of escalated living costs, and occasionally high increments are approved two or three times in the same year.
5. Are salary increments scientifically calculated based on company performance & general economic conditions?
Many companies engage external consultants to assist in salary revisions based on economic conditions. Companies with roots outside the Gulf often have well-structured schemes aligned with their parent company's policies and international rules and regulations to determine employee benefits each year. These companies also set real-time targets and growth/profit margins, which are analyzed and discussed during appraisals. New objectives and key targets for the upcoming financial year are issued as per company policy at this time.
As you and many others realize, true HR practice still has a long way to go in this region, requiring significant efforts to make it a reality. I sincerely hope that interactions, useful discussions, knowledge sharing, etc., utilizing non-profitable Self-Help groups like Cite HR, will prove beneficial for implementing measures beneficial to staff in the future. Thank you for raising this topic.
Ramesh Menon
From United Arab Emirates, Abu Dhabi
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Hello all,
Sajid: I do not have any inputs from other companies at this moment. I started this thread with the hope of gathering information. However, it seems like this is a less spoken-about topic in this part of the world!
Ramesh: I completely agree with your thoughts on the subject. From the little exposure I have had to this market, I should say these were pretty much the conclusions I drew out of the HR practices. I do not think it would be wrong to say that HR is slowly gaining popularity and acceptance in organizations here. I think this is a good step forward for the HR community. I am trying to gather information to build a case for my company to link the two and move towards more mature processes. I must say that I will benefit greatly from the inputs of HR professionals on the HR practices in their organizations. I request everyone to share the practices in their organizations.
Regards,
Shaila
From United Arab Emirates, Dubai
Acknowledge(0)Amend(0)
Sajid: I do not have any inputs from other companies at this moment. I started this thread with the hope of gathering information. However, it seems like this is a less spoken-about topic in this part of the world!
Ramesh: I completely agree with your thoughts on the subject. From the little exposure I have had to this market, I should say these were pretty much the conclusions I drew out of the HR practices. I do not think it would be wrong to say that HR is slowly gaining popularity and acceptance in organizations here. I think this is a good step forward for the HR community. I am trying to gather information to build a case for my company to link the two and move towards more mature processes. I must say that I will benefit greatly from the inputs of HR professionals on the HR practices in their organizations. I request everyone to share the practices in their organizations.
Regards,
Shaila
From United Arab Emirates, Dubai
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Dear Shaila,
It is not only a less spoken subject, but less practiced as well. Hence, we are all here united to facilitate the objectives of CiteHR as well as our group, which we formed recently. The objective is to disseminate HR best practices.
Cheers,
Sajid
From United Arab Emirates, Dubai
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It is not only a less spoken subject, but less practiced as well. Hence, we are all here united to facilitate the objectives of CiteHR as well as our group, which we formed recently. The objective is to disseminate HR best practices.
Cheers,
Sajid
From United Arab Emirates, Dubai
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Hello to all,
There is beginning to be a connection between appraisals and compensation. I have seen two organizations that have implemented performance appraisals based on rated and weighted competencies (a hard subject to teach to those who have limited exposure to both compensation ideology and weighted systems!). The appraisals are then tied to a bell curve approach where, for instance, if you have seven people in the department, you have one "a" player, two "b" players, three "c" players, and one "d," etc. The ratings of the employees are then linked to a "bonus" pool.
I have to say that when one of our clients went to such a performance management system, there was quite a stir internally. However, the CEO and board held to their plan. It forces managers to truly rate performance tied to outcomes and not personality or name preferences.
So, is it widespread? Not yet, but it's coming. :)
Regards,
From United Arab Emirates, Dubai
Acknowledge(0)Amend(0)
There is beginning to be a connection between appraisals and compensation. I have seen two organizations that have implemented performance appraisals based on rated and weighted competencies (a hard subject to teach to those who have limited exposure to both compensation ideology and weighted systems!). The appraisals are then tied to a bell curve approach where, for instance, if you have seven people in the department, you have one "a" player, two "b" players, three "c" players, and one "d," etc. The ratings of the employees are then linked to a "bonus" pool.
I have to say that when one of our clients went to such a performance management system, there was quite a stir internally. However, the CEO and board held to their plan. It forces managers to truly rate performance tied to outcomes and not personality or name preferences.
So, is it widespread? Not yet, but it's coming. :)
Regards,
From United Arab Emirates, Dubai
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Innovative HR Practices-.doc