Piece rate work contract - is it profitable to take these types of contract? - CiteHR
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We are taking a piece rate contract in one of the manufacturing industry and they want to have skilled labours and clients said that the payment will be against the piece rate of the produced product. Plz advise is it profitable to take these types of contract.
Also plz advise on terms and conditions of statutory regulations to maintain the workers in the piece rate contract
Piece rate is a wonderful manufacturing strategy and a cost saving process, although it has a stigma if not being seen. Piece rate promote production and may translate into training for skilfulness but the adverse effect of piece work is low quality because the focus on productivity are crucial.

Piece rate usually an advantage to the client because of the outcome production end result that the client is consuming but in the side of the principal may produce a complex waste production that may involve.

The management of piece rate is conservative on the total cost per bulk considering the statutory counterparts projecting in averaging matrix and should not be base on the standard output unless otherwise you are operating in a precise schedule (raw materials, volume, time frame, etc) and the challenge of piece work/rate remarkably be appreciated when the workers are new or fast moving.

contracts and other regulatory labor employment are technically the same with the regular production, but only varies on the guidelines and procedures.

Dear Mr. Vlademir Greetings for the day..... Thank you very much for your valuable inputs. Is there any kind of documents or list to give us more insight. Kindly let me know..... Regards Vijay Kumar
Mr. Vijay,
Mot of the MNCs get maximum of their spare parts on piece rate contracts just to make final assembly of the end product. But, they have very perfect monitoring and quality control processes before they accept the product.
So, unless proper monitoring and quality control is exercised, piece rate contract sometimes become quite expensive leading to wasteful production and/or huge waste of raw material, as rate contract workers usually try to produce more and more products as against desirable quality. So, you can resort to piece rate contract only if you can ensure tight monitoring and quality control processes at the company level.

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