HRM200 Lecture Notes - Lecture 9: Piece Work, Executive Compensation, Performance Appraisal
22 Jul 2016
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Hrm200: chapter 12 notes pay-for-performance and financial incentives. Fixed pay: compensation independent of performance level, includes base pay, allowances. Variable pay: any plan that ties pay to productivity or profitability, may be in addition to base pay. Piecework: a system of pay based on the number of items processed by each individual worker in a unit of time, such as items per hour or items per hour or items per day. Straight piecework plan: a set payment for each piece produced or processed in a factory or shop. Guaranteed piecework plan: the minimum hourly wage plus an incentive for each piece produced above a set number of pieces per hour. Difficult to adjust for changes in hourly rates. Incentives for operations employees team or group incentives. Team or group incentive plan: plan in which a production standard is set for a specific work group and its members are paid incentives if the group exceeds the production standard.
