Page 52 - F2 Slides 2017-18
P. 52
Remuneration Methods
Time Based Schemes
Total Wages = (hours worked × basic pay/hour) + (overtime hrs worked ×
overtime premium/hour)
Higher quality if workers are happy to spend longer on units to get them right;
However, no incentive to improve productivity.
Piecework Schemes
Total Wages = Number of units completed × agreed rate per unit.
• May involve a guaranteed minimum wage
• May use a higher rate per unit once productivity target achieved
• Higher productivity at the expense of quality?
Other Schemes e.g. Flat salary and bonus
Incentive Schemes individuals or groups
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