Building a happier workplace

Paying personal performance-related bonuses is helping employers in the construction industry attract and retain the best staff, according to research to be unveiled next month.

A survey of more than 3,500 construction employees across the UK will show that staff on personal performance-related bonuses were happier, less pressured, liked their managers more and were prouder of their company.

The research, based on data collected from detailed questionnaires by Personnel Today’s sister magazine, Contract Journal, for its ‘Best Places to Work in Construction Awards’, will also show that employees on these bonuses were half as likely to leave in the next 12 months.

The implied turnover rate was 9.5% for those who were on schedule for a bonus, compared with 19% for those not on the schemes, and 15.5%
for the sample as a whole. The results come at a time when firms in the construction industry are struggling to find enough skilled workers to cope with expansion, which has put recruitment and retention high on the boardroom agenda.

According to industry estimates, the construction workforce is set to grow by more than 200,000 over the next four to five years, with projects such as the 2012 Olympics and transport infrastructure improvements driving demand.

Guy Hazlehurst, deputy director of skills strategy at sector skills council CITB-ConstructionSkills, said: “In a tight employment market, employers will need to do all they can to ensure they attract and retain good employees.”

Analysis of the data shows that, on an agreement index – ranging from plus 100 (strongly agree) to minus 100 (strongly disagree) – those on bonus schemes targeting individual performance come out far more positively across a range of work-related issues.

For instance, those with a bonus scheme scored 52.2 on the agreement index when asked if they had confidence in their manager, compared with 33.7 for those that were not in a scheme.

On whether they had a good work-life balance, scheme members scored 34.6 against 22.4.

On enjoying work, they came out 48.1 to 33.2. And on negative questions, the survey found that they disliked their colleagues less, they felt less stressed, and they felt safer in their working environment.

Chris Charman, reward specialist at HR consultancy Towers Perrin, said the results highlighted the need for employers to ensure clear alignment between individual and organisational performance measures.

“We have found that where individual performance-related pay awards are seen as fair and consistent, they do drive employee engagement, and this is linked with improved company financial performance and employee retention,” he said.

But despite the apparent benefits, only 14% of UK employees receive performance-related pay, compared with a European average of 21%, according to research.

The survey of almost 19,000 employees in 12 European countries, by recruiter Kelly Services, found that employees in the financial services industry were the most likely to have part of their salary linked to performance, with more than one-quarter (28%) receiving bonuses. Workers in the education sector were the least likely, with just 5% of employees picking up bonuses.

Find out more

Further analysis of the Contract Journal data will be published this June at a conference to launch the Workforce Futures 2006 report, which explores people issues in the construction sector.

For more information, go to

For more on Kelly Services survey

Skills shortages lead to stress for construction workers

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