Definition: The Merrick Differential Piece-Rate System is a modification of Taylor’s differential piece-rate system in which three piece-rates are used to distinguish between the beginners, the average workers, and the superior workers, against two piece-rates in Taylor’s system. The worker is paid the straight price rate up to 83% of the standard output, 10 % above the … [Read more...] about Merrick Differential Piece-Rate System
Taylor’s Differential Piece-Rate System
Definition: Taylor’s Differential Piece-Rate System was introduced by F.W. Taylor, who believed that the workers should be paid on the basis of their degree of efficiencies. Under this method, with the help of Time and Motion Study, the standard time for the completion of a job is fixed on the basis of which the performance of the workers is evaluated. Taylor’s differential … [Read more...] about Taylor’s Differential Piece-Rate System
High Standard Hour System
Definition: Under High Standard Hour System, the earnings of the worker vary in the same proportion to the level of output, as in the case of the standard hour system, but the increment in the earnings for each additional unit of output above standard is significant. In other words, the high standard hour system implies that the worker’s earnings start increasing once the … [Read more...] about High Standard Hour System
High Piece Rate System
Definition: High Piece Rate System is an incentive scheme similar to the straight piece-work system, in which the worker’s earnings are in proportion to his level of output, but however, the increment in earnings for each additional unit of output above the standard is much greater. In other words, high piece rate system implies that the increment in the worker’s earnings … [Read more...] about High Piece Rate System
Bedaux Plan
Definition: The Bedaux Plan is an incentive scheme in which the standard time for the completion of a job is fixed and the rate per hour is defined. Each minute of the standard time is called as point or B, such as in one hour there are 60 Bs. Under Bedaux plan, every job has a standard number of Bs. If the worker completes the job in more than standard hours, then he is … [Read more...] about Bedaux Plan
Barth Variable Sharing Plan
Definition: Barth Variable Sharing Plan is yet another incentive scheme in which the time-rate is not guaranteed and the earnings of the worker are ascertained by taking the square root of the standard hour multiplied by the number of hours actually taken for the completion of the job and then multiplying it by the worker’s rate per hour. In other words, an incentive plan … [Read more...] about Barth Variable Sharing Plan
Rowan Plan
Definition: Under Rowan Plan, the standard time for the completion of a job and the rate per hour is fixed. If the time taken by the worker is more than the standard time, then he is paid according to the time rate, i.e. time taken multiplied by the rate per hour. In case, the worker completes the work in less than the standard time; then he is entitled to a bonus along with … [Read more...] about Rowan Plan
Halsey Plan
Definition: Under Halsey Plan, the standard time for the completion of a job is fixed and the rate per hour is then determined. If the time taken by a worker is more than the standard time, then he shall be paid according to the time rate, i.e. time taken multiplied by the rate per hour. In Halsey plan, the time wages are guaranteed even if the output of a worker is below … [Read more...] about Halsey Plan
Standard Hour System
Definition: The Standard Hour System is an incentive scheme in which the standard time in terms of hours is set for the completion of a job. The rate per hour is then determined. The standard hour system is also called as 100 percent gains-sharing. Under this method, the worker is paid for a standard time irrespective of whether the job is completed in the standard time or … [Read more...] about Standard Hour System
Straight Piece-Work System
Definition: The Straight Piece-Work System is the simplest incentive method in which the rate per unit of output is fixed, and the earnings of the worker are computed by multiplying his total output by the rate per unit. In other words, a system in which the worker is paid according to the number of units produced at a fixed rate per unit during a defined period of time is … [Read more...] about Straight Piece-Work System