Many companies no longer reward their employees with annual pay rises, the Chartered Institute of Personnel and Development (CIPD) has said.
According to figures from the organisation, 46 per cent of firms do not offer workers annual paycheque increases.
The sectors least likely to dish out annual rewards are manufacturing, production and private sector service.
CIPD's employment conditions and reward adviser Charles Cotton stated that pay messages must be communicated effectively, otherwise staff can feel "confused, demotivated and in the dark about what they need to do to achieve reward and recognition".
"How you reward and recognise employees sends a powerful message to employees at all grades about what your organisation regards as important," he told employers.
However, CIPD discovered that only a third of employees are confident in their line manager's ability to deliver key messages about pay correctly.
The CIPD recently called for a February interest rate cut, stating that the decision should not be delayed despite good employment figures.
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