Study links performance-related pay to poor health

Aberdeen, Scotland — Workers who are compensated based on their performance are at higher risk for heart disease, chronic stress and poor mental health, results of a recent study show.

Although “performance-related pay” systems can have positive outcomes, researchers at the University of Aberdeen in Scotland note that studies conducted over the past two decades have found links between these systems and poorer health. However, those studies “have been inconclusive and largely based on self-reported data, which is vulnerable to bias.” 

For their study, the researchers looked at data from the UK Household Longitudinal Study, which includes medical information on physiological measures of stress, including blood pressure and stress biomarkers in blood samples.

Findings show that performance-related pay systems are associated with higher blood pressure and subpar mental health. Men, in particular, exhibited higher indicators of chronic stress.

“Chronic stress in PRP employees may be due to the need to put in more effort at work, work under time or performance target pressure, or stress associated with an uncertain income stream,” study co-author Daniel Powell said in a press release. “Regardless of the causes, chronic stress may exacerbate health issues by adding strain onto physiological systems or leading to unhealthy coping mechanisms such as alcohol and drug use.”

Added study co-author Keith Bender: “Our results indicate the use of PRP contracts may have unintended consequences for employee health, impacting on employee well-being and long-term productivity in the workforce. With this in mind, it’s important for firms to consider the potential impact on their employees and implement policies to support their well-being.”

The study was published online in the journal Industrial Relations.