Piecework is a system in which payment is based on the actual number of pieces produced rather than hours worked,and ignores how long it takes.
The opportunity to earn moremoney motivates some at which they work and thus the amount they peoduce.If the employee increases his work speed,he can complete more units of work in an hour.He could potentially make more per hour than he would with a standard hourly rate.With an hourly pay rate,employees know they hard they work so they may be less likely to push themselces.
In many work settings,the piece rate pay method is cost effective,as the company is only paying for work completed.A slower employee may not complete many work units per hour.If you use a standard hourly wage,he gets paid the same,ever if he oney completes a fraction of the work completed by another employee.You may end up paying him less per hour with the piece rate pay method if his peoduction is low.