How does piece rate pay work




















For each overtime hour worked, the employee is entitled to an additional one-half the regular rate for hours requiring time and one-half and an additional full rate for hours requiring double time. Less common method: Using the piece rate as the regular rate and paying one and one-half times this rate for production during overtime hours.

Ensure employees are provided accurate wage statements. However, for piece-rate workers, employers must include the following additional items on every wage statement: The total hours of compensable rest and recover periods. The employee's rate of compensation for rest and recovery periods. The employee's gross wages paid for rest and recovery periods. The total hours of nonproductive time worked. The employee's rate of compensation for nonproductive time.

The employee's gross wages for the nonproductive time. California Compensation Compliance. You have successfully saved this page as a bookmark. OK My Bookmarks. Please confirm that you want to proceed with deleting bookmark.

Delete Cancel. You have successfully removed bookmark. Delete canceled. Please log in as a SHRM member before saving bookmarks. OK Proceed. Your session has expired. Please log in as a SHRM member. Cancel Sign In. Please purchase a SHRM membership before saving bookmarks. OK Join. An error has occurred. Next, the rate of overtime pay comes from multiplying overtime hours by 1. However, because a work-week maximum would be 40 hours, there would be 10 hours of overtime, and only the first 40 hours can be paid at the standard rate.

As can be seen, several disadvantages immediately come to mind when talking about piece-rate. Since the emphasis is on efficiency and quantity, it is possible that the quality of processes suffers as a result. Growers may find that keeping track of the fair compensation for each worker is an administrative and paperwork hassle.

Since the employee is being paid for his output, the worker is encouraged to manage time better, be more productive and finish faster. Harvesting for instance, may very well benefit from a piece-rate scheme. Fruit picking is a particular instance where paying piece-rate will probably increase employee productivity.

Piece-rate makes sense when the worker already knows the craft or duty he will have to perform, or in situations where there are no security hazards which may be perilous to workers working very fast. The rule of thumb is simply this: consider using piece-rate in relatively easy and predictable tasks; these stand to benefit the most from a piece-rate compensation scheme. Interested in learning more about Croptracker? Learn more about our Farm Management Software , or book a demonstration to schedule a meeting with our product experts.

And as always, if you're ever stuck, never hesitate to e-mail us at support croptracker. We're always happy to help, so Croptracker can make your farm more efficient, safer, and more profitable! These factors are outside of the employee's control — but could potentially affect their pay. The answer to these problems is that piece-rate pay systems tend, in reality, to have two elements:.

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