Performance-based Pay System in UK and U.S. and Public Pay System in Taiwan

Since 1980’s, UK and U.S. governments face the constraints on financial resources. In order to control personnel costs of public sector and respond to pressure of human resources and performance management, UK and U.S. governments have been improving to create more flexible public pay system. One of the measures they take is to implement performance-based pay, which provides incentive to civil service and advance public sector performance. According to UK and U.S. government experiences, to establish an objective and equitable performance appraisal system is the first priority in implementing performance-based pay system and performance management. In reviewing the present performance appraisal and pay systems of Taiwan civil service, we can discover that the systems have been criticized for lack of performance-oriented spirit. Therefore, this essay is based on the theories and practices of performance management and performance-based pay, and then reexamines the operations of the systems. In addition, the National Conference on Administrative Reform held in 2001 had made a suggestion for implementing the performance bonus system, which reinforces the performance management system in our government. To promote government administration efficiency and country competitiveness, Central Personnel Administration formulated Performance Bonus System of Administration Authorities in 2002 and carry into execution in 2003. Although the system has ceased from 2007, the implementation of such system officially took the country a step further toward a new milestone of performance management. In view of the high possibility of the system’s carrying into execution afresh, this essay also reexamines the implementation of that system. Finally, based on the results of this essay, we can discover that the present performance appraisal and pay system of Taiwan civil service include the primary shortcoming of not being market-oriented or performance-oriented. In addition, we also find some problems of the implementation of the performance bonus system in practice. Therefore, some suggestions are made toward the administration authorities, in order to be provided for the future modifications of the systems mentioned above.