What Is a Fair Wage and Bonus System? How Is It Applied in Labour-Intensive Production?
In labour-intensive industries, process productivity and quality are directly proportional to workforce performance. An accurate performance appraisal, and a wage and bonus system built on it with consistent, fair and reachable targets, is therefore one of the indispensable management tools of these plants.
Fair wage system
The aim of a fair wage system is to pay each employee a salary that fairly reflects how well they meet criteria set by management according to their abilities. Working with the Arge Bilişim consulting team, an evaluation scale of main criteria and linked sub-criteria is built in the argemas web module: grade definitions, education and seniority definitions, and employee limit definitions.
The system produces a competency evaluation report showing the employee's previous salary, new salary and the criteria that produced it. Decisions are made on that report, after detailed review and analysis.
Bonus system
When an employee generates income above the target earning, sharing part of the excess with the employee is called a bonus. A bonus system rests on three parties: the worker, the investor and the factory. All three must be treated equally and be satisfied; the worker must be content and the investor must not be strained.
The first step of the model is to determine the break-even efficiency point. There is a wage paid to the operator for time worked, and a revenue received from the customer per piece. Because the shared amount is only what lies above the target income, the employer is not strained, while the worker becomes a partner in the target. That partnership is expected to raise both personal satisfaction and a sense of responsibility.
Quality is a bonus parameter too
Like productivity, quality is used as a bonus parameter. Earning the bonus requires quality production as much as efficient production; the system does not reward fast but defective output.