New | Hong Kong firms should look at performance-based bonuses

Companies looking to retain and motivate their high achievers in Hong Kong may consider spending a bigger share of their payroll on performance-based bonuses, while shifting their focus away from longer-term salary increases.

More professionals in Hong Kong believe it would be better off if they were paid bonuses based on their performance, even though it would come with a lower base salary, which makes them stand out of their Asian peers who appear to be more “risk-averse” regarding compensation, a recent study shows.

“A performance-related bonus rewards employees for good work and can be very motivating for employees as they have a vested interest in achieving a top result. For employers, this can motivate their team to work at peak efficiency,” said Christine Wright, Managing Director of Hays in Asia.

Seventy-five per cent of employees in the city said they would rather take a cut in base salary for the chance to be rewarded with bountiful bonuses, compared with an average of 64 per cent for Asians overall, according to poll of 2,361 people across five major economies in Asia launched by Hays, an executive search firm.

By comparison, 63 per cent of employees surveyed in China and Singapore and 48 per cent in Japan said they preferred to receive more cash upfront if they perform well but risk it when their company is disillusioned with their work.

Only 16 per cent of employees in Hong Kong could expect a salary rise of 6 per cent or more this year, while one in two firms in mainland China lifted salaries in their last review by between six to 10 per cent, according to a separate survey by Hays.