The Bonus system

This is the system where a worker is paid an additional skills, talents and abilities, which should be rewarded wage if he completes a given piece of work within a record time under the time rate or he may be paid

(ii) It recognizes the possibility of periodic changes in special rate for every hour saved job content which should always be accompanied by

(b) Task bonus system: appropriate remuneration to the workers so that they can be motivated to carry out the necessary changes.

In this system, piece rates are paid but in addition, bonus is payable only if. the task is completed within a

Merits of piece rate

The quicker workers can earn more than those who are slow or who waste time. .
Workers can work at their pace depending on their ability.
The prospect of earning high wage with hard work stimulates the effort of the workers ..
Output will be increased as employees work bigger loads.
There is no need for supervision. This reduces the cost of supervising employees because any slackening will affect the employees themselves by reducing their earnings.
The employer's costing becomes easier because he knows the exact cost of labour required for a given unit of output.
Team spirit is always developed when workers operate in small groups.

Demerits of piece rate

Under this system, workers are permitted to hold a number of shares so long as they remain in employment and committed to the firm. Such workers benefit from the dividends of the shares they are given. This method is applied for the following reasons:-

To motivate workers.

To provide an incentive for increased output.
To improve the earnings of the firm.
To minimize constant wage increase.
To promote good relationship between management and employees.

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