Performance-Based Pay is a compensation system where employees receive financial rewards based on their job performance. This approach aims to motivate workers to achieve specific goals, improve productivity, and enhance overall company performance. It can include bonuses, commissions, or salary increases tied to individual or team achievements. This pay structure is often used in various industries, including sales and management, to encourage high performance. By linking pay to results, organizations hope to create a culture of accountability and excellence, ultimately benefiting both employees and the company as a whole.