Bonuses pay off Performance bonuses: Timing of payments in Anne Arundel doesn't mean they're a bad idea.

December 24, 1998

FORMER COUNTY Executive John G. Gary's decision to pay bonuses to high-level county employees weeks before an election may have been bad timing, but the notion of rewarding them for improved efficiency is a good one. Before she decides to abandon this practice, County Executive Janet S. Owens should weigh its benefits.

Even though private businesses have used bonuses as part of management compensation packages for years, pay for performance is relatively new for government managers. At times when government cannot grant across-the-board pay raises for high-level employees, pay for performance is a device for fairly compensating those managers who improve the

delivery of public services or save the county money.

Although the $358,544 Mr. Gary paid in bonuses is a substantial sum, the money has to be considered in context. One hundred sixty-five managers shared these bonuses -- an average of $2,173 each -- which were in lieu of an across-the-board pay raise. If those employees had received pay raises of even two percent, the cost would be built into their pay for years.

In Baltimore County, C.A. Dutch Ruppersberger III has instituted a "gainsharing" program that takes performance pay one step further. His program encourages rank-and-file workers to suggest ways of saving the country money and allows them to benefit from their initiative.

In an era when governments are loathe to raise salaries, bonuses are a way to compensate productive and innovative employees without permanently increasing payroll. Savings are usually realized for more than one year and more than cover the cost of a one-time payment.

Pub Date: 12/24/98

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