labour theory

Question 1

describe the time rate payment method

Answer 1

this means employees are paid a a rate per hour for every hour worked, irrespective of the level of output or how hard the employees work. This method is used when it is difficult to measure output per worker eg clerical staff, when all workers are carrying out the same type of work or when quality of work is more important than quantity.

Question 2

describe the piece rate method of payment

Answer 2

this means employees are paid a rate per unit produced. This method is often used in factories where large quantities of identical products are being produced.

Question 3

Describe the flat rate method of payment

Answer 3

This refers to a pricing structure that charges a single fixed fee for a service. This is commonly used by hairdressers or gardeners for one off gardening jobs.

Question 4

describe a bonus

Answer 4

A bonus may be paid above and beyond an employee’s normal wage. It is often given if targets are met and exceeded. It can motivate staff to work harder.

Question 5

describe commision

Answer 5

this is when staff are paid a percentage of the value of sales made. commission is generally paid where specific targets have been met and is on top of a small basic salary. this encourages salespeople to sell as much as possible - the more sales they make the more they earn.