Which type of pay structure could negatively impact employee motivation?

A flat salary for all employees can negatively impact employee motivation because it does not provide any differentiation based on individual performance or contribution. In a flat salary structure, all employees receive the same pay regardless of their effort, skills, or the results they achieve. This can lead to a lack of incentive for employees to go above and beyond in their roles, as their extra efforts will not be recognized or rewarded financially.

When employees see that their potential for financial growth is capped or not influenced by their personal achievements, they may feel demotivated or disengaged. Motivation is often tied to the potential for advancement and reward, and without any variation in pay to reflect personal contributions, employees may not feel encouraged to strive for higher performance or productivity.

In contrast, other pay structures like performance-based pay or bonuses tied to team success can encourage employees to work harder and collaborate effectively, creating a more engaged and motivated workforce. Commission-based structures also motivate employees to excel in sales or performance metrics, aligning their interests with the goals of the organization.