Paying a Bonus on Production
Page 20
Page 23
If you've noticed an error in this article please click here to report it so we can fix it.
A Method of Rewarding Drivers Which is Fbirly Easy of Application in Connection with Local Haulage But Which, Nevertheless, Presents Difficulties and has Certain Dangers
LAST week: I enumerated in my article the various objects which an Operator may hope to achieve by paying a bonus to drivers. There are schemes which are benevolent in their objective, others designed to encourage the care of vehicles, some to diminish the number of accidents, those which have as-their object the increase in the daily tonnage conveyed and, linked as a rule with • the latter, those which are devised to cut down the amount of overtime which drivers work or. at least, to ensure that any overtime which is worked shall be profitable for the employer as well as for the employee.
_ I dealt with the first three classes, giving details of methods employed, and citing some examples. I stressed the importance of linking any such bonus scheme with the award for freedom from accident made in accordance with the plan operated by the Royal Society for the Preve,ntion of Accidents. There can be no.doubt that it is advisable to do this, 'wherever possible, and, as a rule, there is no
difficulty. . .
. Before proceeding' to deal with the remaining kinds of bonus scheme, it is. worth while to digress for a moment and to reflect upon the peculiar relationship which exists between employer and employee in the haulage industry. it is , almost unique and without parallel in any other industry.
It is unusual, because there is no other business in which every employee is expected to take upon himself such responsibilities. This is especially the case in connection with long-distance haulage in which, taking to-day's values as a basis, it is a common thing for a driver to be given charge of a vehicle, the value of which may be in excess of £3,000, and which is loaded with goods to that value, or possibly more,
The driver leaves his employer's premises with this £6,000 ' or £7,000 worth of machinery and material and may not ,be seen again for a week—sometimes longer; But there is more than that. There is something about the personal re?ationship, which is rarely to be found outside the haulage industry. There is, perhaps, no other industry in which the interests of the emplbyee and the employer are so closely knit, or where the employee is so fully alive to the fact that anything which affects the prosperity of the industry as a whole may quickly react upon him. The existe.nce,of this relationship is, of itself, saffi.cient.to justify every employer giving careful considera-tion, to this question Of paying his drivers a .bonus.
No Bonus Scheme Meets All Classes of Haulage
In turning now to discuss the method of paying a bonus on production or performance, it is immediately apparent that no one method of assessing the bonus is likely to be universally satisfactory. The conditions under. which work is carried out vary within such wide limits that it would be impossible to devise a scheme that wankl be suitable in its application to all kinds of haulage.
There is, however,, this fundamental difficulty which Must he mentioned at the start. • _There is.'always the risk,, in paying a bonus on performance or production, that the driver concerned may be encouraged to !mild up his tonnage at the expense of his machine, by overspeeding and—where he can arrange for it without interference—by overloading.
One deterrent to such a course, in these days at any rate," is that if; as the outcome of such lack of care, the vehicle breaks down and is out of .commission the driver is
likely to lose considembly, owing to the .difficulty, and delay in effecting repair's. Apart from that, it would seem to be a good plan to link a bonus ori production with one 'awarded for efficiency and upkeep of the vehicle such as I described in the previous article. The outstanding snag in the way of any such combinationof conditions is that complications are introduced. The . essence of any good bonus scheme, as I have pointed out already, is that it should be simple and not liable to misunderstanding, or apt to create distrust in the mind of the driver.
The notes which I have concerning bonus payments of this .description all relate to local haulage, especially in connection with the transport of sand and ballast, sugar beet and similar work.
So far as sugar beet is concerned, the bonus is usually a direct one on the tonnage conveyed, varying from ld. to 3d. per ton. The differentiation is necessary so as to balance the opportunities' of the driver on short-distance work against those available to the man who is conveying sugar. beet over leads of upwards of 20 miles.
Bonus Distribution Solves an Operator's Overtime Problem
The earliest example of a bonus scheme of this kind, of which 1 have recollection, was one put into operation by a haulier in the west•country. His business. was that of carrying sand and ballast and materials for roadmaking and the like. A large percentage of his work was the conveyanct of 8-ton load's over a distance which made it reasonably possible for a driver, and mate to convey two loads per day without any need for overtime.
Actually, a good deal of overtime was being worked and this operator felt that he was not being given a fair deal by his men. In the end, he solved that problem by cutting out overtimepayments and giving a bonus of 4s. to the driver and 25. 9d. to the mate on every day in which they completed two loads. To-day, of course, such a scheme is impossible, because, under. the Road Haulage Wages Act, an employer must pay for overtime.
. I think it worth. while to mention that scheme as being an early example in which a bonus was being paid solely with the object of ensuring that the employer did not have to pay inordinate amounts in overtime, for which there'
was no real need.
I came across another scheme in the course of a visit to a large quarry owner and haulage contractor in :the Midlands. The class of work upon Which his vehicles were engaged—they were 'mostly of the 5-ton -load 2&-ton unladen-weight 'kind—was such that it was reasonably poSsible for a man to deliver five loads per day. The driver was paid 'a bonus. of 2s. 6d.. for every load delivered in excess of, that number per day. ' He was ncit Penalized if the number of loads delivered fell below five. In practice, so far as I. could gather, this 'scheme worked reasonably well. There wai.1;.ufficient supervision of the -vehicles to make it fairly easy to discover if a driver was misusing Iris machine and after a' few preliminary troubles, due to over-speeding, the 'scheme Settled down. 'A short time ago, I had a letter from an operator who is chiefly concerned with the delivery of agricultural products. I. was informed that the work comprised the following: :short hauls over a' to-mil d lead, from station: to stare, of bagged stuff; short and long hauls up to 15-Miles lead to farms from store; conveying lime, manures and similar materials Which require to be shovelled; distribution of loads of bagged Manures and feeding stuffs frOm store to any. distance from .three to twenty miles, including, I gathered, provision for several •-! drops." The average mileage per week 'per vehicle is approximately 250. . Two lorries . are emplayed—One .a 4-tonner and the other a
6-tonner. ;
The-object this operator had in view was to ensurk a quiCk turn round of his vehicles. He' said that the drivers . were paid the usual wages and overtime. His experience
was that there was a tendency for them to make the work last out the day when, if they had been a little more energetic, and speeded up loading and unloading, it would probably have been possible to move an extra load each day with each vehicle.
The operator was of the opinion that his best procedure would be to continue to pay the straight wages per week, on the appropriate Road Haulage Wages Act scale. In addition, when the driver and mate put a little extra, effort into the job and shifted more tonnage than usual, they should be given a bonus as an incentive to cep/Wive the good work.
Finding the Best Basis for Assessing the Bonus The . question was how should the bonus be assessed, on tonnage, mileage, or number of loads. A particular difficulty, of course, is the variety of the work and the fact that there are two vehicles, one of them carrying four tons and the other six tons. It was envisaged that if a driver, for any lengthy period, found himself on the long leads he would be disgruntled if his opposite number was on short leads and thus able to earn a bigger bonus, whether that bonus was on the basis of tonnage or number of loads delivered.
Having in mind the importance of simplicity and taking into consideration the above variable factors, my view was that the only practicable method was to agree on a bonus based upon the number of journeys completed per week or per month. I favoured the latter, because in the course of a month it might reasonably he expected that the proportion of long-lead and short-lead journeys would even out By taking the number of journeys, instead, of the tonnage, the difficulty of one man operating a 6-tonner and the other a 4stonner would be eliminated. As to the amount of the bonus, that was something upon which I could hardly be expected to adjudicate. I was given no information as to the rates received and without that it is impossible to decide the amount of bonus which an operator could afford to pay.
More exact information was provided in another case where the operator was engaged in conveying ballast over short leads—two to three miles—from a quarry to an aerodrome. Two men were available to assist in loading at the quarry and, in this case, the haulier, having in mind the fact that one would expect to employ six 5-tonuers on the work, arranged to employ two additional loaders. Past experience had convinced him that, in the absence of any special incentive to deliver the goods, the men would be more likely to spend a considerable proportion of their time at a local snack bar and it was in order to cut down that lost time he decided to pay a bonus on tonnage.
The question arose as to what should be the amount of • the bonus and how it should be distributed. It was anticipated that the rate per ton which the haulier would receive would approximate to 6s. On going closely into the question of costs of operation, I Came to the conclusion that each vehicle would involve an all-in expenditure of £11 11i, per week for standing charges only. The running costs worked out at 4i.d. per mile. On the basis of a maximum mileage of 150 per vehicle per week the total cost is thus £14 7s. per week for vehicles with drivers.
To this amount must be added the wages paid to the two loaders; the grand total amounted to £16 per week. The approximate tonnage per vehicle per week was anticipated to average 80, and that, at 5s. per ton, would bring a revenue of £20 per week; giving a reasonable margin of profit and leaving Is. per ton available for the bonus, Ensuring that the Bonus is Fairly Allocated The next question that, arose was how should this bonus be allocated amongst all those employed, the operator having already come to the conclusion that he would have to pay some sort of a bonus for the two helpers supplied by the quarry owners. To pay each driver according to his individual tonnage would cause dissatisfaction, because of certain difficulties which arose at the aerodrome; these would make it easy for one man to shift a big tonnage in the week and difficult foi another. In the end, it was decided to total the Is. per ton bonus at the end of each week and divide that' sum equally amongst the 10 men employed, that is to say, the six drivers, the two loaders, and the two employees of the quarry oivners. This method, besides eliminating the difficulty already enumerated,, has this advantage that the various employees, amongst themselves, would he encouraged to take care that no•one slacked, because in so doing he would be diminishing the earnings of all of them.
S.T.R.