Highly variable income levels with a low base salary threshold or the threat of job loss or layoff can have a severe impact on employee’s feelings of security and their ability to work effectively. It is hard to be committed to an employer whose levels of commitment in return are in doubt or unclear. Lack of security of income is a very real and prominent source of demotivation for employees who may feel trapped and who then try to cope by taking a second job or get involved in part time working. Introduction of the minimum wage made some contribution to this issue, but there are still problems to address of low pay in high-cost areas and poorly designed incentive schemes that can leave people below a ‘decency threshold’, creating a sense of dissatisfaction among them.
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