Short-term variable pay is tied to which of the following?

Short-term variable pay is tied to which of the following?

• A. Annual employee performance reviews
• B. Long-term investment returns
• C. Results attained within a 12-month period
• D. Overall company profit margins

Answer: (C)

Short-term variable pay is specifically designed to reward employees based on their performance over a brief, defined time frame, typically up to a year. The correct choice refers to results attained within a 12-month period, which aligns with how short-term incentives (such as bonuses or profit-sharing) are structured. These incentives aim to motivate employees to meet or exceed their performance goals within this relatively short time frame, allowing for immediate recognition of their contributions to the organization's success. In contrast, options like annual employee performance reviews focus on evaluating performance over a longer period and do not necessarily link directly to immediate financial outcomes or productivity metrics. Long-term investment returns and overall company profit margins are more aligned with long-term incentive plans, which reward employees over an extended period based on broader organizational success rather than short-term achievements.

Short-term variable pay is specifically designed to reward employees based on their performance over a brief, defined time frame, typically up to a year. The correct choice refers to results attained within a 12-month period, which aligns with how short-term incentives (such as bonuses or profit-sharing) are structured. These incentives aim to motivate employees to meet or exceed their performance goals within this relatively short time frame, allowing for immediate recognition of their contributions to the organization's success.

In contrast, options like annual employee performance reviews focus on evaluating performance over a longer period and do not necessarily link directly to immediate financial outcomes or productivity metrics. Long-term investment returns and overall company profit margins are more aligned with long-term incentive plans, which reward employees over an extended period based on broader organizational success rather than short-term achievements.