Financial Motivation Flashcards
Motivated staff can lead to…
high productivity, workers will want the business to do well and so will do their jobs as well as they can to help this happen.
Staff who are motivated and happy in their jobs are more likely to…
stay with the business. Having a high level of staff retention is good for a business as it means less time and money is spent having to recruit and train new workers.
What is a wage?
Commonly paid weekly or monthly.
Calculated in Time rate or Piece rate.
What is a time rate?
Pays workers by the hour. Encourages people to work long hours.
What is the problem with calculating wage using time rate?
Gives employees an incentive to work slowly.
What jobs is time rate best for?
Jobs where measuring output is difficult.
When is a piece rate used?
If the output of each worker can be easily measured.
What does piece rate encourage?
People to work quickly.
What is the problem with using piece rate?
If they work too fast, quality may suffer.
What is a salary?
A fixed amount paid every month, this doesn’t change even if the number of hours worked does change.
What is the advantage of a salary?
Is that the firm and workers both know exactly how much the pay will be.
What is the disadvantage of a salary?
Doesn’t link pay directly to performance, so it doesn’t encourage employees to work harder.
What is commission?
A payment given to employees based on the sales they make.
What is a profit sharing scheme?
A way for businesses to share their profits with their employees
