It refers to performance-linked compensation paid to improve the motivation and productivity of employees. It implies monetary inducement offered to employees to perform beyond accepted standards.
It includes all the plans that provide extra pay for extra performance in addition to regular wages for the job.
According to the National Commission on Labour – Wage incentives are extra financial motivation. They are designed to simulate human effort by rewarding the person, over and above the time rated remuneration, for improvements in the present or targeted results.
According to Suri – A wage incentive scheme is essentially a managerial device of increasing a worker’s productivity. Simultaneously it is a method of sharing gains in productivity with workers by rewarding them financially for their increased rate of output.
Types of Plan-
- Individual Incentive Plan
- Group Incentive Plan
Note- Types will be covered separately in detail.
- Advantages of Incentive Plan
- Limitation of Incentive Plan
- Prerequisites of Incentive Plan Or Requirements of Incentive Plan
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