Which pay type is perceived by employees as based on subjective decisions?

The pay type perceived by employees as based on subjective decisions is a raise based on an annual performance review. This perception arises because performance reviews often include qualitative assessments that can vary significantly from one manager to another. Employees might feel that their manager's personal biases, values, or opinions influence the decision about their performance and the corresponding raise. Since performance metrics can be interpreted differently, individuals may believe that these evaluations reflect the reviewer’s subjective opinions rather than an objective measure of their performance.

In contrast, the other pay types typically incorporate more objective criteria. Bonuses for performance achievement are often linked to specific, measurable targets that can be assessed fairly uniformly. Commission based on sales is based on direct sales performance, making it easier to quantify and less prone to subjective interpretation. Profit sharing is tied to overall company performance, which is typically based on objective financial metrics, rather than individual employee performance. Therefore, while many factors influence all types of compensation, a raise tied to subjective performance reviews stands out as particularly reliant on the personal judgment of those conducting the evaluations.