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Explain other methods of premium payment-Barth Payment System,Emerson's Efficiency Bonus System,Bedaux Point System,Baum Differential Plan,Diemer System
Barth Payment System:
Under this system, the wages payable to the workers are computed as below.
Wages = Hourly Rate X sq. rt. (Standard Hours x Actual Hours)
This system does not give any guaranteed time wages. This system is suitable for apprentices.
Emerson's Efficiency Bonus System:
Under this system the wages are payable to the workers are computed as below:
Wages =Actual Hours X Hourly Rate + Bonus Percentage x Actual -Hours X Hourly rate.
Following percentage limits are given to calculate bonus percentage:
If Efficiency Bonus is:
- Below 66.2/3 % - No bonus is payable. Only guaranteed time wages.
- 66.2/3% to 100% - Bonus is paid at different percentages increasing to 20% at100% efficiency +
Time wages
- Above 100% - Bonus @ 20% + 1% bonus for each 1% increase in efficiency beyond 100%
Efficiency percentage can be calculated on time basis and on output basis. This system is
similar to piece rate. This system may be suitable for non efficient workers for improving their efficiency.
Bedaux Point System:
Under this system, the standard time is divided into standard minutes; each standard minute is identified as Bedaux Point or B. The wages payable to the worker are computed as below:
Wages = Actual Hours X Hourly Rate + 75 % of BS X Hourly Rate 60
(BS (Number of B’s saved) = B’s earned and standard B’s allowed for the job)
This system requires a system of work study as it is difficult to understand and involves a lot of clerical efforts.
d.) Accelerating Premium System: Under this system, incentive increases at a fast rate with the increase in output. Total wages payable to the worker are computed as below.
Y = 0.8 X2
(Y = Earnings, X = Efficiency)
This system is very difficult to understand.
Baum Differential Plan:
This plan is a combination of Taylor’s differential piece rate system and Halsey system and is also known as the Milwaukee Plan.
Diemer System:
This system is a combination of Halsey System and Gantt System.
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