Q. What do you mean by Piece wage system ?

Piece wage system: under this system workers are paid according to the amount of work done or the number of units completed the rate of each unit being settled in advance irrespective of the time taken to do the task. Under this system wage payable to an employee are related directly to the quantity of work done by him. The work may be measured in terms of units of output. The units is called piece and the payment is made so much per piece.

Wage (w) = number of pieces produced (n) *rate per piece (R)

The piece wage system is sometimes called incentive system because the piece rate is directly related to the effort put in by the worker.