Managing Pay and Performance in U.S.-Based Multinationals: A Look at Subsidiaries in the United Kingdom

Abstract

The human resource management policies employed by subsidiaries of U.S.-based multinational corporations (MNCs) have long attracted interest—and sometimes controversy—in the United Kingdom (U.K.) and continental Europe. American MNCs were early adopters of formalized systems of merit pay and, more recently, “forced score distributions,” whereby managers assign a certain fraction of workers to highand low-performing categories during performance reviews (thus creating an intensely competitive review environment). The latter have sometimes been used to determine not just salary levels, but also job security.