Piercing Manufacturing consists of five different levels of its manufacturing plant. Each level has a myriad of tasks that are performed. The company understands how repetitive work could create burnout. In order to motivate its employees, Piercing Manufacturing has adopted the skill-based pay schedule. What are the positives and negatives to using skill-based pay extrinsic rewards in this scenario?

Positives: This type of pay can be a useful way to motivate employees while providing them with an opportunity to showcase their new skills and competencies. Workers are more flexible and productive. Negatives: There is the high cost of additional bonuses and training. There is a possibility that employees may max out their skill levels, which means they cannot receive any additional pay increases unless they change jobs.