Another way employers can reward successful employees is with team incentive plans. These prizes reward entire teams for a job well done rather than the individual performers. These incentives are often the same as incentives offered to individual employees.
Increases are meant for promotions, merit, cost of living, etc. There is less distinction between merit increases and cost of living increases. Modern Pay System pays greater emphasis on variable pay, rather than an automatic increase each year while merit pay is a reward for the results by employee each year.