Is Group Bonus Scheme for Workers Effective?

The incentive schemes discussed so far are applicable to individual workers. But bonus scheme for a group of workers working together may also be introduced. Such type of bonus scheme is known as ‘group bonus scheme’. Such group bonus scheme is applicable where,

(i) It is desirable to create a team spirit,

(ii) It is not possible to measure the production of individual workers,

(iii) It is desired to reward both direct and indirect workers,

(iv) The output depends upon the combined effort of a team.

The features of group bonus scheme are:

(i) Bonus is payable for the efficiency of a team of workers.

(ii) Bonus is paid for joint effort of the team over and above the target fixed.

(iii) Bonus is distributed to the individual workers on a pre-determined percentage basis or in specified proportions.

(iv) The object of the scheme is to develop a team spirit for increased production and lower cost per unit.

The following are the important advantages and disadvantages of group bonus scheme:

Advantages

(i) It encourages co-operation and develops a team spirit among the workers.

(ii) It reduces supervising work.

(iii) Absenteeism is reduced.

(iv) It requires less clerical work and the use of forms and records is reduced because the production of the group and not of the individuals is to be recorded.

Disadvantages

(i) The share of inefficient workers may be the same as that received by more efficient workers of the group.

(ii) Efficient workers are penalised for the inefficiency of the other members of the group.