Disadvantages of the Piece-Rate Pay System:
Hindered Production -- It's virtually impossible to predict how much product can be created within a set time under this system, because the system doesn’t easily lend itself to regulating and encouraging a production line.
Sick or Injured Workers -- Working for piece-rate pay means that workers might come to work when they are ill, thereby risking the health of their coworkers. This could shut down or seriously reduce production output. Additionally, depending on the materials and equipment, if workers are working too quickly in an attempt to produce more, workers could potentially injure themselves, which could open up the company to liability.
Reduced Quality -- When the focus is on quantity, the output the quality may suffer. Such a system requires dedicated employees who are determined to learn their craft thoroughly and then to increase the output. Employees are human, however, and it can be difficult to work at a rapid pace over a long duration. This can mean that employees may continue to work at a rapid pace but that production may produce items of reduced quality.
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