Remote work shifts compensation toward collective bonuses

Research conducted by Professor Uwe Jirjahn of the University of Trier and Dr. Cinzia Rienzo of the University of Brighton indicates that remote work is influencing how companies structure performance-based compensation.

Using data from the British survey ‘Understanding Society’ collected prior to the pandemic, the study found that employees working regularly from home are 14 percent less likely to receive individual performance-based pay. Conversely, the likelihood of receiving purely collective performance-based pay increases by 6 percent for remote workers. Additionally, there is a 20 to 30 percent higher probability that home-based employees receive a mixed form of both individual and collective compensation.

The shift toward collective or mixed bonus structures aims to mitigate the ‘lone wolf syndrome’ often associated with remote work, where individual incentives might decrease cooperation and information sharing. While collective pay promotes teamwork, researchers note it can also encourage ‘free riders’ who benefit from the team's efforts without contributing significantly.