There must be an increased effort to reward individuals. Southwest does not technically
pay based upon performance, since pay is set by union contracts (Flynn, 1995). The company
motivates employees to perform through its culture and the promise of more benefits upon
achieving higher positions. Even if pay contracts limit monetary increases for individuals, there
are still many options as far as cash bonuses, recognition, or training opportunities (Bergmann
and Scarpello, 2008). Performance bonuses may range from pay, bonuses, allowing more
telecommuting work, or other opportunities that interest employees (Compensation trends…,
2006). Higher level employees have shown increased interest in benefits such as flextime, time
off, and more time for family matters (Davolt, 2006). Companies may spend less time and
money on internal training and instead rely on a saturated applicant pool to provide specialized
skills and experience (Hansen, 2001). New strategies may focus more on job redesign, or on a
strategy that is based upon competitiveness. Lawler (2000) recommends individualized pay
plans. Personnel must be flexible in sharing their roles, but paying for how the individual
produces. That would be threatening to a team-based or profit-sharing approach. Companies
may tend toward fixed pay, or position-based pay, if individualized pay leads to increased claims
of discrimination or inequality. As it is, pay is largely fixed due to labor contracts.