When you pay for a person's achieved result or work performance instead of their working hours, this is called as piecework. It has it's advantages for employers and employees. Read on below.
  • Author: Siva
  • Last updated: May 10, 2022
  • 2 Minutes
Piecework explained by Papershift

Piecework Definition

Piecework is a form of work in which employees are paid not on the basis of working time, but on the basis of their work performance. The amount of the salary is calculated from the number of pieces produced and the agreed wage rate. In this way, the payment of the piecework is directly linked to the performance of the employees. In colloquial terms, therefore, work is often referred to as piecework, which must be carried out at a very high speed. In fact, however, it is tied to workers’ pay and is subject to strict legal requirements.

The amount of work done is always assessed on the basis of objective criteria. In accordance with the legal framework, remuneration may only be linked to the following factors:

  1. Number of pieces produced
  2. Length of a piece made
  3. Weight of a product
  4. The volume of a piece

Piecework in practice

Piecework is generally paid in the piecework wage. This is divided into the so-called money chord and the time chord. In practice, however, the time chord is applied much more frequently. This is based on a default time determined by the employer that is required for the production of a unit of measure. If the employee is able to produce a product much faster, he will receive more pay per hour than planned. In addition to the piecework supplement, however, the employee is always paid a basic wage.

In the case of the money chord, on the other hand, the payment of the basic wage is waived. In this method of payment, the employee’s salary depends exclusively on his performance. If he does twice the amount of work, he will also be paid twice his salary. However, due to strict legal requirements, this form of remuneration is only applicable in very few cases. The money chord assumes that all workflows can be completed in the same reproducible time and that no significant disruptions can occur throughout the entire work process. Since all external influences must be eliminated, this form of piecework is not possible if workers are dependent on the work of a machine or a colleague.

There are numerous advantages and disadvantages for both employers and employees in the case of piecework. While workers always have the opportunity to increase their gross income by increasing their earnings, they have to accept a lower salary if they are less efficient. As a result, breaks reduce earnings. Moreover, a minimum wage is rarely enforceable. Since piecework has been shown to cause health damage due to the enormous pressure to perform, it is prohibited for certain groups of people. In addition to adolescents, the law stipulates that pregnant women, nursing mothers, and members of the driving staff are not allowed to work in piecework.

manage rota timesheet and employee absence management on the cloud
Free Trial
Manage Rota, Timesheet & Staff Absence Online
  • Online Rota Planning
  • Staff Timesheet Management
  • Absence & Vacation Approval
  • Payroll Management
  • Friendly Support Team
Rated 4.9/5 by Rota Planners, Admins & Employees
14 days free trial More on Papershift & Solutions

Photo by Tamas Pap on Unsplash

Written by Siva

I write & describe the value & benefits delivered by Paperhift's rota planning, staff time tracking, and employee payroll management software. Especially useful for Shift Planners, Rota Managers, Team Admins, and HR Teams :-)