The pitfalls of pay for performance.

PFP is an incentive scheme in which employees receive extra, performancedependent compensation for their work if they reach certain performance targets. The most common form of PFP incentive awards are cash bonuses. Nearly all firms above minimal size provide some form of PFP to some employees, at least to management level and above. But PFP schemes are also provided at nonmanagement levels and are becoming increasingly popular in the non-profit sector, such as healthcare, where personnel are being rewarded for meeting healthcare service delivery targets.