Piece Work – Any type of employment in which a worker is paid a fixed amount of money for each unit produced or action performed
Note: Piece work can sometimes be written as one word piecework.
To remember what piece work means use the following mnemonic:
For every piece of work (piece work) I do and each unit produced, I get paid a fixed amount of money.
When workers are paid for each unit they produce this is called piece work or piece rate work. Piece work is a form of employment in which an employee receives payment based on the number of items produced, packed or picked. Piece rates are frequently used where the task is repetitive in nature. Each unit a worker produces could be paid:
- per shirt they produce
- per kg of fruit they pick
- per handmade brick they produce
- per item they pack
- per mile driven
- per item assembled
Piece work is allowed in many countries but only if employees earn at least the minimum wage rate per hour a country has set. A company must therefore record the number of pieces finished and the hours worked and prove the worker is earning the minimum wage as an average employee, and a fair rate for each piece of work.
A piece rate pay system may incentivise some employees to work quicker, but you must be careful that the quality of the work is maintained.
Piece rate work is frequently used in the textile, garment and footwear industries for global supply chains. This is because the task is repetitive, there is cheap labour abroad and quite often no minimum set wages. Some economists say that without this work, in a poor country, they would have no work at all.