Merit or Loyalty?

"Job security and salary should be based on employee performance, not on years of service. Rewarding employees

primarily for years of service discourages people from maintaining consistently high levels of productivity."

Discuss the extent to which you agree or disagree with the opinion stated above. Support your views with reasons and/or examples from your own experience, observations, or reading.

Job loyalty can be an important asset for any company. The costs involved in hiring and training new employees can add up for big companies. Nevertheless, is it fair to reward employees only on the basis of years that they have spent with the company? What is the right thing to do?

I feel it is more important for a company to reward merit than loyalty. Rewarding people on the basis of years of service sounds egalitarian, but in real world is almost always counter-productive.

The most pertinent example that comes to my mind is that of government bureaucrats in most of the countries. In many countries in Asia (India) and Europe (UK), the job security and salaries of bureaucrats are essentially linked to years of service. This amounts to total lack of accountability which further transforms to no work and even corruption. If their future was linked to their performance, it would have discouraged such a behavior. 

Another example that I can think of is the information technology (IT) industry. Everyday there are changes in the technology: new programming paradigms, equipments, software and programming languages keep finding their way into the market. Number of years of service are not enough to judge the usefulness of any employee. Unless and until an employee is pro-active, he will not be able to keep pace with the changing environment. What is true for IT is equally true for any technical knowledge based industry.

An employee who does not contribute to the growth of the company is like a parasite living on the company. A company can take responsibility to train, help and educate. Nothing, however, can be achieved without the will of an individual. Promoting number of years instead of performance is a sure-shot way to promote mediocrity and alienate the talented. Any company that does that cannot hope to excel for long.

Concluding, I completely agree with the presented point of view. Merit and merit alone should be the sole basis of promoting anybody in an organization. If talent is not nurtured, it will either go elsewhere or die out. In order to maintain a high level of productivity, it is important to challenge people and let them know that their hard work will be rewarded.