Asked by Carmen Ortega on Jul 29, 2024
Verified
A multinational organization uses a gainsharing program in which employees receive a bonus if the ratio of labor costs to the sales value of production is below a set standard. This incentive plan is referred to as
A) a group bonus.
B) merit pay.
C) the Scanlon plan.
D) a piecework rate.
E) a team award.
Gainsharing Program
A system in which a business shares cost savings or productivity gains with its employees, fostering employee engagement and performance boost.
Labor Costs
The total sum of all compensation paid to employees, including wages, benefits, and taxes, considered an expense for the employer.
Sales Value
The total revenue generated through the sale of goods or services, representing an important metric for business success.
- Analyze the roles and results of a variety of incentive strategies, including the Scanlon plan, gainsharing, and employee stock ownership plans (ESOPs).
Verified Answer
ZK
Zybrea KnightAug 02, 2024
Final Answer :
C
Explanation :
The incentive plan described in the question is known as the Scanlon plan. This plan rewards employees with a bonus if they can reduce labor costs in proportion to the sales value of production. It is a type of gainsharing program, which focuses on aligning employee behavior with corporate goals and objectives. The Scanlon plan is an example of a team-based incentive program, as it requires collaboration and cooperation among employees to achieve the desired results.
Learning Objectives
- Analyze the roles and results of a variety of incentive strategies, including the Scanlon plan, gainsharing, and employee stock ownership plans (ESOPs).