ABSTRACT
This chapter focuses on the wider issues of how the chosen payment system fits into the company wage and personnel policy. The evaluation of existing methods of payment in an organisation, it can be argued, should be part of an evaluation of its pay policy. Furthermore, where effort-levels are satisfactory or satisfactorily controlled there is no case for introducing payment by results. The more complicated the wage-structure and the payment system, the more costly is the administration. According to commonly held convictions the problem of methods of wage payment has nothing to do with the macro-economic problem of wage movements. Regular appraisal as to whether the existing method of payment is appropriate should therefore be part of company policy. Payment by results as a method of effort control offers certain advantages provided cooperation is forthcoming; for instance, the interest arising from the challenge of piece-work goals can contribute to worker morale and efficiency.
