in the fullest degree. Efficiency engineers often contend that it is necessary to work out a different formula for each type of opera- tion in order to apply in each case precisely the right stimulus to increased output. Most of these systems are based in one way or another on the premium bonus system in one or other of its two forms, or on the so-called "differential piece-rate" system advocated by Mr. F. W. Taylor, the founder of " scientific management." Under this system, two different piece-rates are fixed for the same job, and at the same time a standard output per hour is laid down. When the worker reaches or exceeds the standard output he is paid on the higher piece-rate; when he falls- below the standard of output he is paid on the lower piece-rate. Day-work rates are not guaranteed. The object of this system is stated to be the elimination from the job of the less efficient worker by discouraging him with the offer of a lower piece-work price. It is impossible to attempt to chronicle the many different bonus and piece-work systems which have been put forward in Great Britain and America. The Ministry of Munitions in England, during the World War, accumulated a list of many hundreds of different systems which were actually in operation in the British engineering shops alone. It is particularly in the engineering and kindred industries that this wide diversity of forms of wage-payment exists.
It should be noted that both the piece-work system and the various bonus systems and adaptations of them can be operated cither on an individual or on a collective basis. Under the individual system a single worker is remunerated in accordance with his individual output. Under the collective system a group of workers is treated as a unit, and the piece-work price or bonus is paid in respect of the output of the whole group. Collective systems are most often found where the work itself necessarily involves collaboration, and where it is therefore difficult or impossible to separate the individual contribution of the workers engaged upon it (e.g. " squad " or " gang " work). It has, how- ever, been applied also in a large number of cases over a consid- erably wider area in the form of an output bonus paid on the work of a whole shop or factory. In these cases, bonus is some- limes paid only to workers directly engaged on production; but in other cases auxiliary workers, such as foremen, millwrights, maintenance workers, and even workers on the staff, may share in the pool. Many such systems were adopted in shell factories Jin various countries during the war.
A variety of collective " payment by results " is that which is known as the " fellowship " system. Under this system, the workers themselves form groups on a voluntary basis, and share out among themselves, either through the office of the firm, or fcy a subsequent re-division of the sums paid through the office, their collective earnings. This system usually operates among "fellowships" of skilled workers in a particular craft or in closely related crafts.
There are many different ways of sharing out the payment made under collective systems of " payment by results." The most usual method is that each worker included in the group shares in the payment in proportion to his time-rate and to the hours worked on the job. Sometimes, however, the pool, or any urplus over the time-rates of the workers concerned, is equally shared, and sometimes regard is paid only to one or other of the two factors mentioned above. In a few cases a specially large share in the pool is offered as an inducement to a leading worker, ar to a few leading workers; but the system in this form approaches the system of " sub-contracting," which is universally objected to by the trade-union movement.
" Sub-contracting " is usually understood to mean a system under which one worker undertakes a piece of work which re- quires the coordinated labour of a group of workers. The sub- contractor receives the whole sum paid for the execution of the job, making, subject to any limitations that may be laid down in his contract, his own wage contract with the workers under liim, and retaining any surplus for himself. Often a sub-con- tractor, himself paid " by results," remunerates the workers under him on a time-work basis. It is generally recognized that the sub-contracting system is open to grave abuse, and with the
advance of trade-union organization it has been gradually eliminated from industry, surviving only in a comparatively small number of cases. The outstanding instances of it in the past have been the " butty " system in the mining industry, which still exists in one or two British coalfields, and the methods of payment which used to be adopted in many sections of the iron and steel industry.
Distinct from both the piece-work system and the various bonus systems is the system of " commission," which is applied in a certain number of occupations. Under this system the worker receives a commission on " takings " or on profits either as his sole mode of remuneration, or as an addition to a minimum wage or salary. This is the position of most workers in the insurance business, and of a number of managerial and semi-managerial workers in the distributive trades. It is also found occasionally in other occupations.
The attitude of employers and workers towards these various systems of wage-payment differs widely from case to case. Recently, attention has been mainly concentrated on the endeavours of employers to introduce systems of " payment by results ". into industries in which time-work systems are at present largely in operation, e.g. building, engineering, ship- building. Usually these attempts have met with strong trade- union opposition. It must not, however, be concluded that employers are universally favourable or trade unions universally opposed to " payment by results." The position differs from industry to industry. In the textile industries, and in a number of the less-organized occupations, " payment by results " has been introduced and maintained not merely with the acquiescence, but often at the instance of the workers, who have seen in it an opportunity of securing higher earnings. At the other extreme, the worst forms of " sweating " in industry are very frequently found in conjunction with the time-work system of payment. In the past, trade unions have usually favoured, or at least not opposed, " payment by results " in those industries in which a standard of measurement can be found of such a character as to insure that, under normal conditions, a given amount of effort expended will result in a given amount of output,, and therefore of earnings under the system. On the other hand, the unions have generally been opposed to the introduction of " payment by results " in those industries in which no such standard can be laid down, as well as in other cases where it has been contended that " speeding up," consequent upon the inducement offered for higher output, would have the effect of impairing the quality of the work done (e.g. building). Where " payment by results " has been accepted in industries of this latter type, a struggle has often followed over the question whether the right of the or- ganized workers to bargain collectively over the fixing of piece- work prices or " basis times " shall or shall not be recognized. This struggle is still in progress over a wide range of industries; but the fixing of piece-work prices and " basis times " is still normally done by the employer or his representative, subject only to protest by the workers or their representatives.
It should be noted that the growth of " scientific management " has given a great impetus to the introduction of " payment by results," and has also considerably affected the methods adopted by employers in fixing piece-work prices or " basis times." In the great majority of factories, other than textile factories, in which systems of payment by results are in operation, piece- work prices are still fixed in a very haphazard fashion, and modi- fied from time to time in accordance with actual experience of their working. But, where one feature or another of " scientific management " has been introduced, experiments have been made designed to introduce a greater scientific accuracy into the fixing of prices and times. The methods which have been in- troduced with this object are mainly those of " time study " and " motion study." " Time study " means an attempt, by actual observation of the doing of a particular job, either by a selected worker or in a number of selected cases, to fix the time which ought to be occupied in the doing of it by a normal worker. " Motion study " means the observation of the doing of a job with a view to eliminating all surplus motions, arid to the laying
