Professional Documents
Culture Documents
Incentives Programme
Stock Ownership or
Options
Balanced Scorecard
Team / Group
Incentives
Productivity / GainSharing
Merit Pay
Lump-Sum Bonuses
Individual Incentives
Individual Incentives
Group Incentives
Gain-Sharing Plans
Earnings-at-Risk Plans
(1)
Pay constant function of
production level
Relationship
between
production level
and pay
Pay varies as function of
production level
(2)
Standard hour plan
Bedeaux plan
(3)
Taylor differential piece
rate system
Merrick multiple piece
rate system
(4)
Halsey 50 - 50 method
Rowan plan
Gantt plan
Earnings vary
Earnings vary
Proportionately
less
proportionately More than outputs
than output
Earnings differ
at different levels
of output
Taylors Differential
High Piece Rate
High Standard Hour Piece Rate
Merrick Differential
Halsey Plan
Piece Rate
Rowan Plan
Gantt Task System
Barth Scheme
Emersons Efficiency
Bedaux Plan
plan
Halsey Plan
Rowan Plan
Barth Plan
Bedaux Plan
Time - Based
Output - Based
Halsey Plan
This plan was first designed by
Halsey in 1890. Under this plan,
a standard time is fixed for
completing a work in advance. A
person taking standard or more
time is paid for the time taken by
him. A worker completing his
task in less than the standard time
is paid for some of the time
saved. The payments for time
saved vary from 33 1/3% to 66
2/3 % but generally wages for
one half of time saved is paid.
Rowan Plan
This system is similar to that of Halsey plan. A worker is
guaranteed minimum wages for time spent on the job. He gets
bonus for completing the job in less than the standard time. The
only difference between Halsey and Rowan plans is the method of
calculating bonus is that proportion of the wages of the time taken
which he saved bears to the standard time allowed. Wages are
calculated by the following relations:
W = T x R + (S T / S) x T x R
Example 2.
Standard Time : 32 Hours
Solution.
Barth Plan
Under this plan, wages are not guaranteed. This system is
suitable to beginners and learners. The earning is
computed by multiplying the rate per hour by the
geometric mean of standard hours and actual hours
worked.
Bedaux
Plan
It is a combination of time and bonus
scheme. Standard time for a job is
determined by time study. Standard
production per hour is determined and the
unit of measurement is minute. An hour is
taken as sixty minutes. Each minute of
standard time or allowed time is called a
point Bedaux point.
Rate per Hr
High piece-rate
Std Outputs
Time taken
Std Bonus
=Re 0.50
= Re 0.10
= 80 units
= 8 Hrs
= 20%
Case 1 Output
= 70 units
Earnings
As the output is less than the standard only time wages are paid to the worker
=8*0.50=Rs 4.00
Case 2 Output
=80 units
Earnings
As the output is equal to the standard, the worker is entitled to time wage plus
20% bonus
Time wages
=8*0.50= Rs 4.00
Bonus
=20*4 = Re 0.80
100
Total earnings
= Rs 4.80
Case 3 Output
=110 units
As the output is more than th Std, the worker is entitled to a high piece rate
10*0.10= Rs 11.00
Emersons Plan
Up to 67% of efficiency, the workr is determined by dividing the time taken by the Std
Time-rate
Up to 100% efficiency, 20% bonus is paid to workers
An additional bonus of Rs 1% is added for each additional 1% eficiency
Case 1 Output in 10 Hrs: 50 units
Efficiency: 50%( below 67%, the worker is eligible for 50% of the time wae as bonus)
Case 2 Output in 10 Hrs : 100 units
Efficiency : 100% (time-wage + 20% bonus)
Case 3 : Output in 10 Hrs : 130 units
Efficiency : 130%
At the rate of 20% at 100% efficiency and 1% increase for every 1% increase in
Efficiency, the worker is eligible for 50% of the time wage as bonus:
Time wag =10*1
Rs 10.00
Bonus
=50*10.00 Rs 5.00
100
Rs 15.00