(g) The Emerson System.
In order to arrive at a gradually increasing bonus line, Mr. Emerson took a point on the wage line at 66·6 per cent. efficiency, and another on the 100 per cent. efficiency line at 20 per cent. bonus. The bonuses between these two efficiencies were then arranged so that for each 1 per cent. increase in efficiency the bonus increased in greater proportion. The resulting diagram is a curve which is approximately a parabola. Beyond 20 per cent. efficiency the worker gets paid for all time saved.
By this method reward begins fairly early, so that all workers should be able to get some reward. It progresses very slowly from 66·6 per cent., and at 80 per cent. is about 3¼ per cent. of the wage rate. Then it increases more quickly, and at 90 per cent. efficiency it is 10 per cent. of the wage rate, at 95 per cent. efficiency it is about 15 per cent., and at 100 per cent. efficiency it is 20 per cent.
One thing must be noticed: The reward above 100 per cent. efficiency is based on standard time, and not on reward time. This means that the worker gets a bonus of 20 per cent. on the time worked, and in addition to that the full rate of wages for the time he saves above standard time. As an example, take a job with a standard time of 20 hours:
| Case I. | |
|---|---|
| Suppose job done in | 22 hours. |
| Efficiency | 91 per cent. |
| Bonus (see diagram) | 10 per cent. |
| 10 per cent. of 22 hours | 2·2 hours. |
| Reward: 2·2 hours at 10d. | 22 pence. |
| Wages: 22 hours at 10d. | 220 pence. |
| Total payment for 22 hours | 242 pence. |
| Hourly rate for job (wages + reward) | 11 pence. |
| Case II. | |
| Suppose job done in | 18 hours. |
| Efficiency | 111 per cent. |
| 20 per cent. on 18 hours | 3·6 hours. |
| Time saved (20-18) | 2·0 hours. |
| Reward: 5·6 hours at 10d. | 56 pence. |
| Wages: 18 hours at 10d. | 180 pence. |
| Total payment for 18 hours | 236 pence. |
| Hourly rate for job (wages + reward) | 13·1 pence. |
This method enables the worker to get reward at a comparatively low efficiency. The reward is not much to begin with, but it is enough to induce the worker to try and get a higher efficiency. When standard time is reached, the reward is not enough, but beyond that it increases rapidly.