Seniority Vs merit in pay and promotion (Research Paper Sample)

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Moving between the organizational levels by promotions, transfers and job rotation and layoffs define employees’ life cycle as an entity in a business environment. These changes result in changes in status, and often, pay of affected employees.
At the end of every year, organizations are usually faced with the challenge of selection criteria for determining which employees are eligible for promotions and pay rises, which in most cases are tied to one another. What to be taken into account when evaluating employees’ suitability for promotions, pay rises and other forms of rewards is usually dominates decision making in such scenarios. Many factors influence the criteria for selecting and promoting employees and it is usually a complex undertaking. Some employees who meet the selection characteristic may fail to get the promotion due to the complexity of the process. This is because, organizations vary in nature and structure, and criteria that may be suitable for one organization in the process may not always be the best option in organization with a different structure and of different nature.
Seniority and tenure is an age old tactic that has been employed by companies and organizations to award employees pay rises and promotions. The more an employee stays with a company, the more likely he is to be considered for promotions and higher remuneration rates. As long as they are not involved in incidences or scenarios that may jeopardize their reputation and tenure while in service. This is a preferred method in some areas of the world where it is preferred to retain existing employees, instead of employing fresh graduates who start work with relatively higher remuneration expectations and less experience. Very unionized industries for instance steel industries, vehicle manufacturers among others also have a tendency to promote employees on the basis of seniority in the company. In some companies, employees get paid the same amount and there is little variance in the nature and content of their duties and responsibility. Here, the amount of time an employee has served the company is usually the basis upon which promotions and pay increases are awarded. Other sensitive industries like Medicine, seniority is usually an indicator of experience and it is preferred to have senior employees handling higher responsibilities than junior employees and seniority is the ruling promotion criterion unless exceptional merit cases are involved. (Kumar & Sharma, 2001)
Intrinsic advantages of using merit as a basis for promotion include simplicity. It is a simple method to implement and is less susceptible to favoritism towards some employees over others. This method is also popular among majority of workers and has been used for ages. It also improves employees’ personal security. They can almost predict when they are going to be promoted. Every employee knows their place in the promotion list. It is also easier for organizations to retain experienced employees when the basis of seniority is used for promotion purposes. (Kumar & Sharma, 2001)
The shortcomings of seniority as a promotion method however include lack of incentives to junior employees since they know they have no chance of promotions any time soon. This hampers the morale and development of employees with high potential. Also, the senior most people may not always be the most skilled or competent. Practically, determination of seniority is a challenge since factors like interruption of service, which may be as a result of performance issues come into play.
Merit on the other is the basis of promotion where, the ability to work or perform certain duties and responsibilities takes prominence. Even junior-most employees who are able to work qualify for promotions. All employees are motivated to improve their effectiveness by this criteria. Records of performance, interviews both oral and practical and examinations, among other methods, determine the merit of an employee, which is a basis of promotion preferred by most management personnel. (Murugan, 2007)
Merit is a good method because under this method, employee motivation is higher. Productivity and efficiency improve and this is a good way for organizations to succeed. In order to ascertain employee merit, employee appraisal performance has to be conducted. This way, employee performance shortages can be identified and removed by training. Young and talented employees are motivated to improve their productivity and performance by this method too.
However, the method of Merit demoralizes senior employees especially when their juniors are promoted. Trade unions also do not advocate for the method as it allows discrimination of their members, who mostly constitute senior, experienced employees. A person may also be competent for the job he is doing but not ready for a higher position. He or she might fail or not be as efficient when promoted. There also is no fool proof method to measure merit. This method is one that is highly susceptible to favoritism. Managers may use merit as a way to cover for promoting their favorite employees. Other employees may lose faith in the promotion policy and this would result in labor disagreements. (Murugan, 2007)
Each of the two criteria for promotion and pay rise awarding, as evident, has inherent pros and cons. Using either method exclusively is definitely bound to create a conflict among the employee fraternity. It is therefore imperative to strike a balance or implement a method that fuses the two, so that no section of employees feel left out. For instance, in s...