Piece Work

rroberts

I'm looking for some info and guidance on paying employees for "piece work". We're looking into implementing the piece work system.

phammond

If you do get any responses, I'm hoping you would be willing to share. I also am trying to find someone that is still doing piece work or has a similar incentive pay structure that has been successfully implemented. Please send to: [email]phammond@integrausa.com[/email]. Thanks much!

Patti

E Wart

We have some employees that do this. However, I am not really "gung ho" for a lot of reasons, even though it could be a win/win situation. These folks take the work home and do it off company property.

The one thing that you MUST do is be able to "justify the rate" you pay. (In other words figure how how long a "normal" person takes to do this and how many they can do over a set period of time, etc. How much would you pay an employee by the hour if they were "fully trained" to perform this duty. You should pay the employee by the piece, but have to be able to show that if overtime is reach on their regular pay, they also have overtime included in their piecemill. Also some locations (TX) require that you show on the pay stub the number of items paid. (like number of hours.)
If you want to discuss, please call me at 770-981-2803 x 27.
E Wart

JILL M

>I'm looking for some info and guidance on paying
>employees for "piece work". We're looking into
>implementing the piece work system.

Since you are required to pay OT after 40 hours, you must calculate the employee's hourly rate and OT rate in a formula by dividing the total dollar amount of the piece rate by the number of hours worked. The formula would look like this:

Let's say that the employee earned $673.24 worth of piecework and worked a total of 42.33 hours that payroll week.

$673.24 divided by 42.33 hours = $15.90 hourly rate.

Therefore their OT rate would be $23.85/hr.

The 40 hours would be paid at $15.90/hr and the 2.33 hours would be paid at $23.85/hr for a gross pay total of $691.77.

You would just have to figure out the amount per piece you are going to pay and then set up a spreadsheet to plug in the number and it can figure out the hourly and OT rates and their gross pay. I have this in a spreadsheet but it is set up for hauling tons of rock/sand, but you are welcome to have a copy if you want it.