Pay · HR glossary

Merit Increase

A merit increase is a rise in base pay linked to assessed performance under an employer's pay policy. It is different from a one-off bonus or a general salary-range adjustment.

Example

During the pay review, an employee receives a base-salary increase based on documented performance and their position within the relevant salary band.

What to keep in mind

Explain how performance, budget and range position affect the decision. Strong performance does not imply a particular increase unless the employment terms or policy make that commitment.

Further reading

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