Wage incentives: In Emerson’s efficiency plan, when is a worker paid a bonus?

Introduction / Context:Emerson’s efficiency plan is a wage incentive system that pays a guaranteed day wage up to a threshold and then adds a graduated bonus as a worker’s efficiency surpasses that threshold. It aims to stimulate higher productivity without penalizing workers at moderate performance levels.

Given Data / Assumptions:

• Standard time or output established via work measurement.
• Efficiency = (Standard time / Actual time) * 100% or equivalent output ratio.
• Company applies Emerson’s graduated bonus schedule.

Concept / Approach:Under Emerson’s plan, no bonus is paid below a minimum efficiency (commonly 66 2/3%). Above this point, a bonus increases progressively with efficiency, reaching meaningful percentages at and beyond 100% efficiency. This differs from Halsey/Rowan (time-saved based) or Gantt (guaranteed day rate plus high bonus at or above standard).

Step-by-Step Solution:

Verification / Alternative check:Payroll simulations show zero bonus below the threshold, then a rising bonus curve, aligning pay with performance and encouraging method adherence.

Why Other Options Are Wrong:Options (b), (c), and (d) correspond to other plans or misstate Emerson’s rule; option (e) is too strict and ignores the graduated bonus above the threshold.

Common Pitfalls:Setting standards too loose or tight; confusing efficiency definitions; failing to communicate the bonus schedule clearly.

Final Answer:When output (efficiency) exceeds 67% of the standard