Wayne Inc., a health insurance company, pays clerks an incentive based on the average amount of work completed per hour. Wayne pays $10 for processing 20 invoices per hour. An employee who processes 30 invoices would earn $15 per hour. Hence, Wayne pays the same rate per invoice no matter how many invoices an employee processes per hour. Which type of incentive pay does this scenario illustrate?

Question

Mathematics

Johan Hebert

20 September, 12:37

Wayne Inc., a health insurance company, pays clerks an incentive based on the average amount of work completed per hour. Wayne pays $10 for processing 20 invoices per hour. An employee who processes 30 invoices would earn $15 per hour. Hence, Wayne pays the same rate per invoice no matter how many invoices an employee processes per hour. Which type of incentive pay does this scenario illustrate?

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Answers (1)

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Tamia Wood · Answer 1

Answer: Straight piecework plan

Step-by-step explanation:

The Straight piecework plan is a type of incentive system in which the rate per unit output is constant and fixed at a specific value. And the total earnings of a worker is calculated by multiplying the value of its total output by the rate per unit output.

In the case above the rate per unit invoice processed is fixed, so employees are paid based on the number of invoice processed per hour which makes it a Straight piecework plan system.