Two main methods adopted for providing motivation for shop-floor time workers are as follows.

1. Allotting a given quantity of work per shift, and allowing the members of the shift to leave when the quota has been completed, payment being made for the standard shift. This is possible only where tasks are readily definable. The system does encourage hasty and slipshod work.

2. Modifying the pure time rate by applying some degree of work measurement. Thus, for example, output targets can be set, with bonuses payable for exceeding the target. Bonuses may take the form of a higher hourly rate for time worked after target completion, or of a specific payment per unit of output exceeding the target.

Piece rates

The simplest form of piece rate to understand is that of the early nineteenth-century home worker in a cottage industry. The worker was provided with a measured quantity of material, was loaned the necessary tools, and was paid a fixed sum for each unit of output. This system is still used for remunerating part-time addressers of envelopes and other home operators doing routine work.

It is widely recognised that time worked is not an adequate measure of the work done, since it takes no account of efficiency, skill, effort and speed. This can be partly but not wholly offset by a more or less complicated system of gradings and differentials, and by job evaluation.

The adoption of pure piece rates - pay according to size of output - is an attempt to overcome this, but in its raw form it becomes a source of friction between workers. For example, where a bricklayer is paid per 100 bricks laid, some workers could draw twice the wage of others for the same time spent working. It is nevertheless true that where output per worker can be easily measured, and the quality is of a readily recognised standard, piece work can be a powerful incentive to increased production.

Advantages of Time Rates

Time rates are the most widespread basis for renumeration, although they are often subject to modification by the application of certain features of work measurement technique (see page 6). The main circumstances in which pure time rates are appropriate are:

(a) where output cannot be measured (e.g. a local government officer);

(b) where rate of output is determined not by the individual but by the speed of a machine or process (e.g. operator of a canning machine);

(c) where quality of work or time taken per unit of output is not the primary essential (e.g.... see: Advantages of Time Rates

Personal And Business Finance 2018

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