1. INCENTIVE SCHEME FOR WORKSHOP WORKERS
By :- ANURAG KAPIL
IRAS

2. WHAT IS INCENTIVE SCHEME
Kind of bonus system followed by Indian Railways.
Introduced to improve productivity and to increase outturn.
First formal incentive scheme in C.L.W. in December 1954.
Time is basis of this scheme and the time standards used are predetermined after systematic work measurement.
Also known as “the system of payments by results”.

3. SALIENT FEATURES Basic wages guaranteed to all the workers.
Time is the yardstick for measuring work.
The system envisages fixation of time standards for each operation through ‘time study’.
The ‘allowed time’ is so fixed that the average worker completes an operation in 75% of the allowed time and thereby earn 331/3 % bonus.
Allowed time includes allowances for fatigue(12.5% - 25%), general handling(12%), gauging(5%) and production bonus allowance(33.33%).

4. Contd…. Extra time above the allowed time can be allowed due to:-
Excessive machining work
Hard material
Defects in the machine
Change in the batch quantity against a work order.
Job cards are the basic document to calculate the incentive.( punched on or off with the aid of job recorders)
The results will be determined on the total quantity passed by the Inspector concerned.

5. CALCULATION OF INCENTIVE
DW incentive = Total Saved Hours X Hourly Rate
(Total Saved Hours subject to maximum profit ceiling of 50% of time taken)
Total Saved Hours = Total Allowed Time – Total Time
  Taken
Hourly Rate of Pay = Total Wages Leave Salary
No. of Hrs. of Attendance + No. of Hrs. on Leave
With Pay

6. REVISED INCENTIVE SCHEME
The actual Allowed Time for each activity to be reduced by 12%.
Reduction in Allowed time is achieved by reducing
Fatigue Allowance from 25% to 12.5%
Contingency Allowance from 12.5% to 10%
EIWs should be less by15% of the DW’s.

7. WORKING OUT OF ALLOWED TIME
Before September After September 99
Description
Rate
Time
Cum.Time
Diff.
Diff.%
Normalised Time 1
Fatigue Allowance
25%
0.25
1.25
12.50%
0.125
1.125
Contingency Allowance
0.156
1.406
10%
0.113
1.238
Production Bonus
33.33%
0.469
1.875
0.412
1.65
Total Allowed Time(W/OGA)
0.225
12%
Gauging Allowance 5%
0.094
1.969
0.082
1.732
Total Allowed Time(WGA)
0.237

8. Contd………..
Calculation of the Direct Worker be done by dividing the modified activity by 267 ie. number of working days in the Work Shops.
Strength of Supervisors to be calculated afresh.
Minimum number of Supervisors should be there depending on the requirement of the workload.
No Over Time should be paid to the staff, which is covered under the incentive scheme.

13. THANK YOU