1. Gross Earnings: Piecework and Commissions
Section 6.2
Gross Earnings: Piecework and Commissions

2. Piecework
Piecework Rate: pays an employee a given amount per item produced. (no regard to time)
Gross Earnings = pay per item x number of items
EX: A production worker is paid $0.58 for assembling a lamp, $1.23 for a ceiling fan, and $0.86 for a box fan. One week, a worker assembled 220 lamps, 318 ceiling fans, and 174 box fans. Find the worker’s gross earnings.

3. Gross Earnings for Differential Piecework
The pay per item is dependent of the number of items produced. (The pay increases with # produced as an incentive.)
EX: Scooter Frame Co. pays welders as shown. Find the gross earnings of a welder who welds 282 frames.
1 – 150 Frames
$2.85 each
151 – 250 Frames
$3.20 each
Frames
$3.45 each

4. Gross Pay for Piecework with a guaranteed hourly wage
The worker can earn an hourly wage or piecework pay, whichever is more.
EX: A cabinet door finisher is paid $ per hour for an 8-hour day, or $0.95 per cabinet door finished, whichever is higher. Find the gross earnings:
DAY
Mon
Tues
Wed
Thurs
Fri
# of Doors
106
127
152
120
138

5. Overtime Earnings for Piecework
Time and a half is paid on the piecework rate for Overtime!
Ex: An assembler is paid $0.84 for each child car seat assembled. During a recent week, she assembled 400 seats on regular time and 138 car seats during OT hours. If time and a half is paid for each OT assembly, find the gross earnings per week.

6. Gross Earnings for Commission
Gross Earnings = Commission Rate (%) x Sales
Note: any returns and allowances must be deducted from sales before you multiply!
Ex: An Avon salesperson had sales of $45,350 one month, with returns and allowances of $432. If the commission rate is 18%, find the gross earnings.

7. Variable commission rate
Sliding scale is designed to be an incentive to get more sales.
Find the correct rate based on sales, then multiply.
EX: Timmy sells office copiers to businesses and is paid a variable commission rate. Find the gross pay if sales are $38,400.
Sales
Commission Rate
Up to $20,000 2%
20,001 - $30,000
2.5%
Over $30,000 3%

8. Salary plus Commission
Blends commission with guaranteed pay.
Gross pay = fixed amount per pay period + commission
EX: Sanford is paid a salary of $290 a week, plus a 4% commission on all sales over $750. Find his gross earnings for a week in which his total sales were $1870.