Dot.com firms are still paying their workers more than other companies do despite the burst of the internet bubble, new figures reveal today.

Pay awards in e-commerce companies are averaging 4%, a full percentage point above settlement levels for the whole economy, according to pay experts at Industrial Relations Services.

Two thirds of firms offer their employees share options, while over half offer short-term incentives such as sales commissions or variable bonuses.

"Despite the dot.com downturn, employees in the e-commerce sector continue to enjoy above-average pay rises and potentially lucrative share options," said Jeremy Baugh, the editor of IRS's pay and benefits bulletin.

Pure internet companies are offering bigger pay rises than the internet divisions of traditional companies. Pay deals at the latter are rising by 3.25% on average.

But with share prices in the sector still languishing, options schemes are no longer such a draw. Staff at internet companies are also much more likely to have their pay linked to performance.

"Half the standalone internet companies operate all-merit schemes, where pay is linked to some measure of employee performance," said Mr Baugh.

Employees in the internet divisions of traditional companies tend to have the same terms and conditions as other staff.

For all the hype about different ways of working in the new economy, flexible benefit schemes are rare, operated by just one in seven firms surveyed by IRS.