Is It Fair or Effective to Hold Salaries for Not Meeting Sales Targets? Let's Discuss!

Hi,

I work for an investment company (sales-oriented company). There have been changes coming in our company policy and regulations. The message being conveyed is that non-performers are not to be entertained in the company. The targets have been increased for all, and each person is under pressure to perform well. If a person is not able to perform well within a month, their salary will be kept on hold until they show better performance in the next month. If, in both months, the employee is unable to achieve the given target, they will be asked to resign. I have an opinion that this is a wrong practice initiated by the company, but I cannot do anything as I am working at a junior level, and sales take over all HR decisions.

Every person needs time to settle down in a system and start performing; that's the reason we have a probation period in all companies where we assess the performance of the person and decide to make them permanent or extend the probation period. Only if the performance is drastically poor do we ask the employee to resign.

So, is this the right practice to follow in any organization?

Please suggest...

Hi! Deep,

You are right; this is not a really good thing to hold the salary of an employee, whether they are permanent or on probation.

For a person on probation, the company always has enough time to judge his/her performance. But if a company has made that person permanent, that means he satisfies the performance level of the company. Now, after that, the company cannot impose these kinds of rules.

In marketing and sales, everything depends on competitors' products, their and your marketing skills, the global economy, etc. All you could do is not give any kind of bonus to those not achieving the targets, and for the poorest performer, you could give a particular time period and then ask them to resign, but never hold their salary.

Even though you are on a junior level, I think you need to talk to your management and also let them know that the employees are not happy with this discussion and what the employee turnover rate would be. Apart from this, if anyone comes to know about this in the market, then the company's reputation would get spoiled, and no new person would join the company.