Merit Matters: in practice
What Would You Do? Let's practice
Scenario 1
Scenario 2
Scenario 3
Scenario 4
Scenario 1: Let’s review the SI proposals made by Marylin
- Respecting the overall budget
- 100% Completed.
Risk / Issue: a standardized increase ignores market competitiveness, internal equity, and individual performance, making it unfair and ineffective for retaining and motivating talent.
Example
Acknowledge the completion rate and respect of the budget.
Clarify the need to discuss and review the proposals.
Example
Scenario 1:
The manager has proposed a flat salary increase, aligned to the market movement, to all their team. How can you advise?
Explain why a flat increase does not address the employee positioning which is based on external market benchmarks and the employees current salary relative to the range.
Example
Example
Link pay with performance as pay is a key lever for recognizing contribution.
Clarify the next steps and expectations.
Example
Scenario 2: Let’s review these bonus proposals
- Respecting the overall budget
- 100% Completed.
Rounding
Overwrite the bonus recommendation to grant the same bonus to both employees.
Risk / Issue: Granting the same bonus to employees in different job level and with different performance undermines fairness, is not respecting the fundamentals of the merit methodology, and can negatively impact morale and/or create future expectations.
Example
Explain the overall methodology and guidelines.
Example
Scenario 2:
Explain the factor: bonus opportunity
A manager approaches you to understand why two high performers in the team have different merit bonus recommendation. How can you handle?
Example
Explain the factor: individual performance
Explain the factor: group performance
Example
Clarify the next steps and expectations
Example
Scenario 3: Let’s review these RAP proposals
Risk / Issue: Giving retention bonuses to all employees dilutes their purpose by removing differentiation, reducing their effectiveness as a targeted retention tool, and turning them into an entitlement rather than a strategic incentive.
Selectivity is not OK
As a guidelines, we expect around 10% of all merit employees to receive a RAP
Amount proposed are not OK
A small amount has no retention purpose, the same amount is not equivalent in terms of %, ignores the % per job level
Justification is not OK
RAP must be justified correctly to identify the purpose of the RAP allocated to support the Senior Announcer in their review of the cases
Example
Clarify the need to discuss and review the proposals
Describe the selection criteria and steps for RAP selection
Example
Scenario 3:
A manager has given RAP to 4 out of 4 employees, how can you advise?
Example
Ask for the business needs / reasons behind each allocation
Once identified the cases, discuss the RAP proposal amount
Example
Clarify the next steps and expectations
Example
Scenario 4: Let’s review the complete proposal for Lakiesha
- High Performer
- High Potential
- Expert Level
Risk / Issue: Granting a salary, bonus and retention package significantly above HR recommendation, even for a key employee, poses risks of internal inequity, budget overruns and diminishes the message and purpose behind each merit element.
2 times above guidelines – no promotion
2 times above guidelines – critical role
RAP 53% (reco 12% -35%)
Example
Acknowledge the retention need and the proposals
Clarify the need to discuss and review the proposals
Example
Scenario 4:
The manager has a need to retain a key member and is proposing above guidelines on all merit elements. How can you advise?
Example
Discuss the RAP proposal
Re-explain the methodology behind the guidelines
Example
Clarify the next steps and expectations
Example
Thank you for practicing Merit Matters
Example:
“Let’s review each case within these lenses to understand the retention need. We also need to insert relevant justification, as you know the next phase in the process is the review by the global head.”
Example:
“I saw the proposal for Lakiesha, we know that she is not only a high performer but also a high potential. We recognise the need to retain her.”
Example:
“I was looking at your proposals and saw that it has now been submitted and you are respecting the overall budget.”
Example
“the merit bonus factors include the level of the job : in this case we see firstly that the 2 employees are at different levels (expert vs specialist). The level of their roles is different, hence the remuneration must reflect this difference.”
Example:
“Both are high performers but with different ratings and therefore their individual performance is different.”
Example:
“The salary increase % are based the country context and on salary positioning. This information is visible in the tool as you can see some employees positioning id above while some others are competitive. This indicates how an employee’s current salary compares to the established range, so it reflects the external competitiveness. LDC reviews frequently the ranges”
Example
“in this case the last factor is indeed the same for both individuals as they both have the company multiplier considered”
Example:
“I will send it back to you for you to review. To remove some of the RAP and revise the amount according to the recommended guidelines for the selected employees.”
Example
“3 main retention lenses to select employees for RAP: embedded into the Talent strategy (people identified as talent, high potential, high contribution roles), Specific people challenge (highly strategic business needs, specific skills-sets) or Point in Time (ensure business development or continuity, key organizational needs at a specific moments, Projects).
Example:
“I will send the proposals back to you. Of course you have flexibility in the increase to better fit the needs but considering the recommended target increase while doing the proposal ensure a fair and equitable decision.”
Example:
“I will send it back to you for you to review both the salary increase and the merit bonus proposal to be closer to the recommended guidelines, to ensure we convey the correct message this year and not create unrealistic expectations for the future.”
Example
“Now that we have agreed on the cases that are selected for RAP, it is key to allocate an amount which is significant enough to convey the correct message.”
Example
“In addition, HR recommendation reinforces a pay-for-performance culture by recognizing and rewarding the individual performance and contributions of the employees.”
Example
“However I have noticed that you are going above the proposals on all the merit elements in addition to granting RAP.”
Example
“the rating 9 is considered into the guidelines both for the salary increase and the merit bonus. Therefore being a high performer is included into the guidelines and does not justify going twice above guidelines.”
Example:
“the RAP proposal is justified, and the main purpose is indeed to retain key employees. It is important however to give the correct message when announced and propose an amount which is reasonable. ”
Example
“However I have noticed that you have applied a standardized salary increase to all, rather than following the HR recommendation visible in the merit tool.”
Example:
“I will send it back to you for you to review. While your role as merit manager is to arbitrate proposals, it is also key that the fundamental principles behind the methodology are respected to ensure fair and equitable proposals.”
Example:
“ Looking at the RAP proposals, you have proposed a retention to all your team. Giving a retention bonus to all employees diminished the reasoning and its value.”
Example:
“the merit bonus target % reflected in the merit tool is the results of a simulation considering eligibility criteria and methodology”.
Merit Matters: In practice
LDC
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Transcript
Merit Matters: in practice
What Would You Do? Let's practice
Scenario 1
Scenario 2
Scenario 3
Scenario 4
Scenario 1: Let’s review the SI proposals made by Marylin
Risk / Issue: a standardized increase ignores market competitiveness, internal equity, and individual performance, making it unfair and ineffective for retaining and motivating talent.
Example
Acknowledge the completion rate and respect of the budget.
Clarify the need to discuss and review the proposals.
Example
Scenario 1:
The manager has proposed a flat salary increase, aligned to the market movement, to all their team. How can you advise?
Explain why a flat increase does not address the employee positioning which is based on external market benchmarks and the employees current salary relative to the range.
Example
Example
Link pay with performance as pay is a key lever for recognizing contribution.
Clarify the next steps and expectations.
Example
Scenario 2: Let’s review these bonus proposals
Rounding
Overwrite the bonus recommendation to grant the same bonus to both employees.
Risk / Issue: Granting the same bonus to employees in different job level and with different performance undermines fairness, is not respecting the fundamentals of the merit methodology, and can negatively impact morale and/or create future expectations.
Example
Explain the overall methodology and guidelines.
Example
Scenario 2:
Explain the factor: bonus opportunity
A manager approaches you to understand why two high performers in the team have different merit bonus recommendation. How can you handle?
Example
Explain the factor: individual performance
Explain the factor: group performance
Example
Clarify the next steps and expectations
Example
Scenario 3: Let’s review these RAP proposals
Risk / Issue: Giving retention bonuses to all employees dilutes their purpose by removing differentiation, reducing their effectiveness as a targeted retention tool, and turning them into an entitlement rather than a strategic incentive.
Selectivity is not OK As a guidelines, we expect around 10% of all merit employees to receive a RAP
Amount proposed are not OK A small amount has no retention purpose, the same amount is not equivalent in terms of %, ignores the % per job level
Justification is not OK RAP must be justified correctly to identify the purpose of the RAP allocated to support the Senior Announcer in their review of the cases
Example
Clarify the need to discuss and review the proposals
Describe the selection criteria and steps for RAP selection
Example
Scenario 3:
A manager has given RAP to 4 out of 4 employees, how can you advise?
Example
Ask for the business needs / reasons behind each allocation
Once identified the cases, discuss the RAP proposal amount
Example
Clarify the next steps and expectations
Example
Scenario 4: Let’s review the complete proposal for Lakiesha
Risk / Issue: Granting a salary, bonus and retention package significantly above HR recommendation, even for a key employee, poses risks of internal inequity, budget overruns and diminishes the message and purpose behind each merit element.
2 times above guidelines – no promotion
2 times above guidelines – critical role
RAP 53% (reco 12% -35%)
Example
Acknowledge the retention need and the proposals
Clarify the need to discuss and review the proposals
Example
Scenario 4:
The manager has a need to retain a key member and is proposing above guidelines on all merit elements. How can you advise?
Example
Discuss the RAP proposal
Re-explain the methodology behind the guidelines
Example
Clarify the next steps and expectations
Example
Thank you for practicing Merit Matters
Example:
“Let’s review each case within these lenses to understand the retention need. We also need to insert relevant justification, as you know the next phase in the process is the review by the global head.”
Example:
“I saw the proposal for Lakiesha, we know that she is not only a high performer but also a high potential. We recognise the need to retain her.”
Example:
“I was looking at your proposals and saw that it has now been submitted and you are respecting the overall budget.”
Example
“the merit bonus factors include the level of the job : in this case we see firstly that the 2 employees are at different levels (expert vs specialist). The level of their roles is different, hence the remuneration must reflect this difference.”
Example:
“Both are high performers but with different ratings and therefore their individual performance is different.”
Example:
“The salary increase % are based the country context and on salary positioning. This information is visible in the tool as you can see some employees positioning id above while some others are competitive. This indicates how an employee’s current salary compares to the established range, so it reflects the external competitiveness. LDC reviews frequently the ranges”
Example
“in this case the last factor is indeed the same for both individuals as they both have the company multiplier considered”
Example:
“I will send it back to you for you to review. To remove some of the RAP and revise the amount according to the recommended guidelines for the selected employees.”
Example
“3 main retention lenses to select employees for RAP: embedded into the Talent strategy (people identified as talent, high potential, high contribution roles), Specific people challenge (highly strategic business needs, specific skills-sets) or Point in Time (ensure business development or continuity, key organizational needs at a specific moments, Projects).
Example:
“I will send the proposals back to you. Of course you have flexibility in the increase to better fit the needs but considering the recommended target increase while doing the proposal ensure a fair and equitable decision.”
Example:
“I will send it back to you for you to review both the salary increase and the merit bonus proposal to be closer to the recommended guidelines, to ensure we convey the correct message this year and not create unrealistic expectations for the future.”
Example
“Now that we have agreed on the cases that are selected for RAP, it is key to allocate an amount which is significant enough to convey the correct message.”
Example
“In addition, HR recommendation reinforces a pay-for-performance culture by recognizing and rewarding the individual performance and contributions of the employees.”
Example
“However I have noticed that you are going above the proposals on all the merit elements in addition to granting RAP.”
Example
“the rating 9 is considered into the guidelines both for the salary increase and the merit bonus. Therefore being a high performer is included into the guidelines and does not justify going twice above guidelines.”
Example:
“the RAP proposal is justified, and the main purpose is indeed to retain key employees. It is important however to give the correct message when announced and propose an amount which is reasonable. ”
Example
“However I have noticed that you have applied a standardized salary increase to all, rather than following the HR recommendation visible in the merit tool.”
Example:
“I will send it back to you for you to review. While your role as merit manager is to arbitrate proposals, it is also key that the fundamental principles behind the methodology are respected to ensure fair and equitable proposals.”
Example:
“ Looking at the RAP proposals, you have proposed a retention to all your team. Giving a retention bonus to all employees diminished the reasoning and its value.”
Example:
“the merit bonus target % reflected in the merit tool is the results of a simulation considering eligibility criteria and methodology”.