Has anyone tried "Piece Work" to pay employees?

[wjohn13]

We are trying to come up with ways to get employees to be more productive, without sounding like we are being slave drivers. I used to have a roommate who was a welder, and he was paid for every fitting he was able to weld during his shift, pretty much leaving how much money he wanted to make up to him. I want to know if there are any shops out there that have tried to pay their employees, using this method. I would think it would go something like this. The employee makes $16.00 per hour. The machine they run has been proven that it can produce 10 parts per hour. If we set a goal of 80%, that would mean that the employee would have to produce 8 parts per hour at $2.00 per part to make his $16.00 rate. The upside is, that employees, with minimal effort, can give themselves a raise to $18.00 or even $20.00 per hour depending on how hard they want to work. Produce more parts, and make more money. Granted, this is all dependent on them producing good parts. If the employee has downtime between parts and wants to make even more, they could possibly be assigned a small job assembling parts with o-rings and seals and get something for that. I would think, it would benefit both the shop and the employees equally. As it stands right now, employees feel they can make 4 per hour, 6 per hour, or 10 per hour and still make the same, so why put more effort in when the pay is the same? Any thoughts on this would be greatly appreciated.

 

[Milland]

If you want to introduce piecework, be sure to check the laws of your state first, there could be issues of fair employment that come into play.

You also may wind up with tension between workers - what if one person's work depends on another, and the second person is too slow?

In extremes, there can be theft or even sabotage between workers who feel aggrieved.

Basically, proceed cautiously.

 

[gustafson]

Productivity starts at the top.
Right now your employees could make the money you are paying them working a drive through or folding sweaters in a store.
Rather than look at them, look at yourself, and figure out how to make the process better
The fewer opportunities an employee has to affect throughput the better.
Better fixturing
More parts per table load
proper powered tools
better lighting.
The whole work smarter not harder
why should your employee have to bust his ass to make a living, if you haven't busted your ass to make them able to do it.

 

[Philabuster]

Quality also tends to slide if people are trying to get as much product volume out on their shift as possible. More parts means more money!

 

[Booze Daily]

Then you'll get guys who bust ass Mon-Thur and hide the extras so they can turn them in Fri and skate thru the day.

 

[jaguar36]

Why not just give the guys who bust their ass and make good parts a raise? If you pay per part what happens when the machine goes down? Or what about the other work that needs to get done but doesn't count as a part?

 

[DDoug]

Lincoln Electric.

Incentive Management

www.jflf.org

And:

Bricklayers' Bonus System Article

(This is the article written by Justin Breithaupt, Jr., the owner of Non-Stop, that was published in December 2018 issue of Masonry magazine.) We Don’t Have a Manpower Problem, We Have a Production Problem by Justin Breithaupt, Jr. One of the most popular events at the World of Concrete is the...

nonstopscaffolding.com

 

[DDoug]

Why not just give the guys who bust their ass and make good parts a raise? If you pay per part what happens when the machine goes down? Or what about the other work that needs to get done but doesn't count as a part?

It all needs factoring in.
It's a contract, and needs to address everything, as both parties will try to loophole all the time, gaming the system.

Statistical average, is used when machine goes down. Forman must put employees on this, goes on a nightly report, upper management doesn't like to see.
Employee is present for work, and is unable to do so for lack of machine, tools, material etc.

 

[amaranth]

LeFere forge used to pay by piecework. There were in business for 89 years so it worked for a while, but I was at their liquidation auction a few years ago. One of the reasons stated for closing was the inability to attract and keep workers. Looked like a gawd awful place to work as well.

 

[DDoug]

A large percentage of American Industry ran "incentive" for workers.
It's downfall I think was the cutting of prices by management, perverting the system for quick gains.

 

[standardparts]

Then you'll get guys who bust ass Mon-Thur and hide the extras so they can turn them in Fri and skate thru the day.

Oh yeah.
Did piece work for about 6 months. Buy coffee for the set-up guy. Buy coffee for fork truck driver. Be really nice to the foreman taking care of crap work so he would pencil whip the card and get me a higher rate.
Come in late--need to leave early--no sweat had a "bank" stashed to make rate.
So yeah...each day, a bit of a bank to cover for any issues. Survival in a rat hole.
No way to let them catch on...they would just re-time the job.
Clip boards and a guy with a stop watch so gotta play the game and watch the count and timing.
Yeah...wonder, if in all it's original old school format it even exists anymore.

 

[alek95]

I don't think that machining is particularly well suited for piece work incentives, unless you have a very robust QC department checking everything.

Why would anyone make good parts when you get more money by making crappy parts with poor finish?

Any competent machinist could easily give themselves a 50% raise by gaming the system.

Much better idea to give a discretionary productivity bonus at the end of the month to the highest performers. Even $100-200 above their usual pay is enough to make people feel like their hard work is noticed.

 

[DDoug]

I don't think that machining is particularly well suited for piece work incentives, unless you have a very robust QC department checking everything.

Why would anyone make good parts when you get more money by making crappy parts with poor finish?

Any competent machinist could easily give themselves a 50% raise by gaming the system.

Much better idea to give a discretionary productivity bonus at the end of the month to the highest performers. Even $100-200 above their usual pay is enough to make people feel like their hard work is noticed.

Piecework was applied to machining.
Shops did have QC to verify good parts.

How can you offer a bonus with out having QC ? In your example, people can game the system the very same way.

 

[M.B. Naegle]

The only cases I've heard of piece work working is in textile work, but often that is because one employee is making a complete item, or the items are broken down by management into smaller billable items (IOW, one guy is tasked and payed to cut out blanks, and the next guy is tasked and payed to assemble those blanks). In these cases, there's often minimums and maximums set such that you can't do more of an item than the company could sell and you can't do more than the guy before you is making on average. Just-in-time philosophies go out the window in these cases too. Companies that do this have lots of material and stock spread out in various stages on the floor waiting for the next op. Often too it works when employee's are taking work home to do as they can make up lost time or make a little extra to help the shop catch up, etc. Can't always take work home with a machine shop.

It can be made to work, but in the end IMO it's not a fix for poor productivity. IMO, if the guys are not motivated to give 100%, then Nickle and diming their time in the building isn't going to make them any happier. Whatever the problem, your solution needs to address it, not work around it.

 

[metal-ica]

Unless you have guys making the same part on the same machine year-in and year-out I don't see how to implement this very easily.

Had a neighbor in the 80's with a small shop...a two man operation.

The owner and machinist would work up a quote...I think the ratio was 50/50. The machinist would get a set amount for the job and the owner would take the other half for overhead.

It may work for a small operation but not really scalable.

 

[mhajicek]

Who gets credit for the unattended overnight runs? You are doing that, aren't you?

 

[gustafson]

Thought experiment:
Double your workers pay and still make money
What would you do?
Do it anyway

Covid:
I am working more now the last 2 years.
Can I tell you how much I have sliced cycle times?
Improved throughput?
Because my time is important

Pretend your workers is too!

I bought a Brother, taught me a lot
I have to make cycle times longer
what?
It is so fast, I cannot do the routine secondary ops that I did before.
Thus the machine must do it
Expensive tools, programming, but....

To me a 'good' process is where any secondary ops[deburr, blow off, check, put in a bin get next part, blow it off etc] take less than half the spindle time. This means you can do something else, take a leak, check the coolant level, throw stuff at a coworker, without substantially affecting cycle time, because you can do the next two together, more or less.

With the Brother, there is no way to do that stuff, so you have the machine do more, which would have been time inefficient on an older slower machine[tool change etc]

Think this way, not 'my employees are lazy'

 

[plastikdreams]

Are you that cheap? And then people wonder why we can't get people into the trade.

Get bent ya fuggin wanker.

 

[Scruffy887]

Other than your pay scale is crap, piece work only works for product parts in production. And to keep your butt clean I feel it is best to offer it on top of a standard wage. Production bonus and offered only to shop foreman/supervisors. People you trust. They will get the workers in line because it effects their pay. And workers need a living paycheck.
Your bigger issue may be total shop attitude. Do your employees feel they are part of a bigger enterprise that benefits their livelihood? Like they have some ownership? Would they feel comfortable saying "do you want fries with that?"
BTW, my shop foreman just bought a slightly used BMW big ass M series as a daily driver. Has heated armrest too. Good for him as he earned it.

 

[gustafson]

wussy
fookin heated armrest
my elbow is cold and I like it that way