Dear All
We are a food company and employing the worker to make the product on piece rate. the Shift is of 12 hrs out of which 1 hrs lunch break and another 1 hrs for other activity so the out put is considered for 10 hrs. The PR worker is has to produced 1550 pics in 1 working shift. so pl let me know .
1. Is over time should be considered into while giving out per piece wages. how deal with every day OT
2. ESIC, PF, Bonus and Gratuity should be part of PR rate.
3. what if person produced the less than target so MW will not be meet in that case what should be done.
4. what component should be taken into account for making PR.
5. Is PR viable or daily wages.
Pl advice and if any further information is required pl let me know.
regards
Jagjit singh
(
)
From India, Vadodara
We are a food company and employing the worker to make the product on piece rate. the Shift is of 12 hrs out of which 1 hrs lunch break and another 1 hrs for other activity so the out put is considered for 10 hrs. The PR worker is has to produced 1550 pics in 1 working shift. so pl let me know .
1. Is over time should be considered into while giving out per piece wages. how deal with every day OT
2. ESIC, PF, Bonus and Gratuity should be part of PR rate.
3. what if person produced the less than target so MW will not be meet in that case what should be done.
4. what component should be taken into account for making PR.
5. Is PR viable or daily wages.
Pl advice and if any further information is required pl let me know.
regards
Jagjit singh
(
From India, Vadodara
## PIECE WAGE SYSTEM
This system is based on output or productivity of the workers. Piece rates are frequently used in certain industries or occupations where the work is repetitive in nature, and where employees have a high level of control over the results.
1. Is over time should be considered into while giving out per piece wages. how deal with every day OT?
Answer: Under this system, a fixed rate is paid for each unit produced job completed or operation performed. Payment is made according to the quantity of work done and no consideration is given to the time taken by the worker to perform the work. An equitable piece work rate should be determined to give an inducement to the workers to produce more. Workers are paid according to their performance because distinction is made between efficient and inefficient workers. An efficient workers are earn more wages because wages are linked to output . This gives an inducement to the workers to increase their production.
Idle time will not be paid for as is the case under this wage system.
As per Minimum Wages Act, 1948-Where an employee, whose minimum rate of wages is fixed under this Act by the hour, by the day or by such a longer wage-period as may be prescribed, works on any day in excess of the number of hours constituting a normal working day, the employer shall pay him overtime rate.
So overtime should be not consider in Piece wages system because wages are linked to output and this system motivate it to workers to produce more to get more wages.
2. ESIC, PF, Bonus and Gratuity should be part of PR rate.
Answer: The Production record for Piece workers have to be maintained. The price of the article made by each piece worker has to be described and the wages register must show the number of pieces made by a particular employee in a month and the earnings has to calculate accordingly. The important issue comes here is the coverage of such piece rated employees under the ESIC, EPF, Bonus and Gratuity.
You can also refer the said Act to know “Employee” defined under ESIC, EPF, BONUS AND GRATUITY.
3. What if person produced the less than target so MW will not be meet in that case what should be done?
Answer: To be fair and effective, piece rate systems should be transparent, reward employees according to the difficulty and quality of their work, and ensure that motivated workers can earn substantially more than the minimum wage.
As per Minimum Wages Act, 1948-
a) A minimum rate of wages for piece work referred to as "a minimum piece rate".
b) Where an employee is employed on piece work for which minimum time rate (If an employer sets the working hours and the workers have to “clock” in and out, this counts as time rate work not as output or piece rate work) and not a minimum piece rate has been fixed under this Act, the employer shall pay to such employee wages at not less than the minimum time rate and vice –versa.
For example, In the State of Madhya Pradesh the minimum wage notification for piece rate beedi rollers (hand rolled cigarettes) indicates a guaranteed minimum wage per week provided they roll 5600 beedis per week. Workers are entitled to this if the raw materials supplied are inadequate to roll this number. However, the guaranteed minimum wage will not be payable where the failure to roll 5600 beedis is attributable to the worker.
4. What component should be taken into account for making PR?
Answer: All Remuneration i.e. Fixed and Variable components
5. Is PR viable or daily wages?
Answer: This will be differentiate on the following Basis-
Time or Output: Daily wages are determined on the basis of time spent on the job while Piece rate wages are determined on the basis of output.
Efficiency: Daily wages rate are not linked with efficiency while piece rate wages are linked with the efficiency of the worker i.e. higher the number of unit produced, higher are the wages.
Quality: In daily wages rate quality of work is very high because wages are fixed for normal working hours while in piece wages rate quality of work need not be very high because wages are payable on output .
Supervision: In daily wages rate close supervision is required so that employees may not waste their time while in piece wages rate close supervision is not required because employees to produce more to get more.
Maintenance: In daily wages system employees are more concerned their quality work not quantity work so that maintenance cost is low of machine and tools because they are properly handled while in piece wages rate maintenance cost of machine and tools is high because employees are more concerned their quantity work to produced more.
Strained Industrial Relations: In daily wages rate relationship between employer and employee are good due to fair wages system while in piece wages rate the relations between employer and employee become sour if their outputs are low .
Regards,
Amit
From India, Delhi
139This system is based on output or productivity of the workers. Piece rates are frequently used in certain industries or occupations where the work is repetitive in nature, and where employees have a high level of control over the results.
1. Is over time should be considered into while giving out per piece wages. how deal with every day OT?
Answer: Under this system, a fixed rate is paid for each unit produced job completed or operation performed. Payment is made according to the quantity of work done and no consideration is given to the time taken by the worker to perform the work. An equitable piece work rate should be determined to give an inducement to the workers to produce more. Workers are paid according to their performance because distinction is made between efficient and inefficient workers. An efficient workers are earn more wages because wages are linked to output . This gives an inducement to the workers to increase their production.
Idle time will not be paid for as is the case under this wage system.
As per Minimum Wages Act, 1948-Where an employee, whose minimum rate of wages is fixed under this Act by the hour, by the day or by such a longer wage-period as may be prescribed, works on any day in excess of the number of hours constituting a normal working day, the employer shall pay him overtime rate.
So overtime should be not consider in Piece wages system because wages are linked to output and this system motivate it to workers to produce more to get more wages.
2. ESIC, PF, Bonus and Gratuity should be part of PR rate.
Answer: The Production record for Piece workers have to be maintained. The price of the article made by each piece worker has to be described and the wages register must show the number of pieces made by a particular employee in a month and the earnings has to calculate accordingly. The important issue comes here is the coverage of such piece rated employees under the ESIC, EPF, Bonus and Gratuity.
You can also refer the said Act to know “Employee” defined under ESIC, EPF, BONUS AND GRATUITY.
3. What if person produced the less than target so MW will not be meet in that case what should be done?
Answer: To be fair and effective, piece rate systems should be transparent, reward employees according to the difficulty and quality of their work, and ensure that motivated workers can earn substantially more than the minimum wage.
As per Minimum Wages Act, 1948-
a) A minimum rate of wages for piece work referred to as "a minimum piece rate".
b) Where an employee is employed on piece work for which minimum time rate (If an employer sets the working hours and the workers have to “clock” in and out, this counts as time rate work not as output or piece rate work) and not a minimum piece rate has been fixed under this Act, the employer shall pay to such employee wages at not less than the minimum time rate and vice –versa.
For example, In the State of Madhya Pradesh the minimum wage notification for piece rate beedi rollers (hand rolled cigarettes) indicates a guaranteed minimum wage per week provided they roll 5600 beedis per week. Workers are entitled to this if the raw materials supplied are inadequate to roll this number. However, the guaranteed minimum wage will not be payable where the failure to roll 5600 beedis is attributable to the worker.
4. What component should be taken into account for making PR?
Answer: All Remuneration i.e. Fixed and Variable components
5. Is PR viable or daily wages?
Answer: This will be differentiate on the following Basis-
Time or Output: Daily wages are determined on the basis of time spent on the job while Piece rate wages are determined on the basis of output.
Efficiency: Daily wages rate are not linked with efficiency while piece rate wages are linked with the efficiency of the worker i.e. higher the number of unit produced, higher are the wages.
Quality: In daily wages rate quality of work is very high because wages are fixed for normal working hours while in piece wages rate quality of work need not be very high because wages are payable on output .
Supervision: In daily wages rate close supervision is required so that employees may not waste their time while in piece wages rate close supervision is not required because employees to produce more to get more.
Maintenance: In daily wages system employees are more concerned their quality work not quantity work so that maintenance cost is low of machine and tools because they are properly handled while in piece wages rate maintenance cost of machine and tools is high because employees are more concerned their quantity work to produced more.
Strained Industrial Relations: In daily wages rate relationship between employer and employee are good due to fair wages system while in piece wages rate the relations between employer and employee become sour if their outputs are low .
Regards,
Amit
From India, Delhi
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