Priestman Bonus Plan

It is the group incentive plan.

Under this plan, a standard production is fixed for the entire factory for a particular period in consultation with workers. The actual production is compared with the standard production at the end of the period. If the actual production exceeds the standard production, all workers are paid a bonus in proportion to the increase in output. Workers are assured time wages if the actual output does not exceed the standard output. 

Advantages-

• Workers try hard to produce more because they are to get the bonus only when actual output is more than the standard output.
• The plan is easy.
• Promotes Team spirit.

Disadvantage-

• The quality of the product may compromise. 
• There is no distinction between efficient and inefficient workers.