Which pay method rewards workers based on output per item, commonly used in manufacturing?

• A. Time rate
• B. Profit sharing
• C. Commission
• D. Piece rates

Answer: (D)

Piece rates are a pay method that rewards workers for each item produced. In manufacturing, where the number of units completed can be measured accurately, paying per item creates a clear link between effort and earnings. The more units a worker finishes, the higher their pay, which provides a strong incentive to boost output and productivity. However, this can risk quality if the emphasis on quantity is too strong, and earnings can swing with demand or downtime rather than just effort. Other pay methods aren’t tied to item-by-item output: time-based pay rewards only the hours worked; commission is based on sales sales, not production; and profit sharing distributes a portion of overall profits regardless of individual item output.