2. Topic: Incentive
Wages Plan

3. What is incentive wages plan
Wage system that rewards a worker for
productivity above an established
standard.
Incentive pay is based on a bonus given to
the workers who exceed a given standard
production rate within a defined period of
time for increasing the efficiency of
employees and workers

4. Things Included In Incentive
Wage Plans
free house facility
free education of children of workers
free medical treatment
Bonus
commission
and other excess money gifts.

5. OBJECTIVES OF WAGES
INCENTIVE PLAN
Good employee-employer relationship.
 Helps in increasing productivity.
 Boosts morale of employee.
 Motivates employee to perform better.
improves quality of life.
 Improves the image of the organization.

6. Features of incentive plans:
1) Minimum wages are guaranteed to all
workers
2) Incentives by way of bonus, etc are offered
to efficient workers for the time saved.
3) A standard time is fixed and the worker is
expected to perform the given work within the
standard time.

7. Types Of Incentives
Straight piecework plan
The 100 percent bonus plan
Group bonus plan

8. Advantages of incentive
plan
(i) Increase in volume of output .
(ii) Reduction of cost of production per unit
(iii) Reduction of labor turnover.
(iv) Reduction of idle time
(v) Benefit to consumers

9. Disadvantages of Incentive
Plans :
i. Difficulty to fix standard time.
ii. More supervision required.
iii. Union opposition.
iv. Rough work.
v. Effect health.

10. Motives of incentive wage
plan
To earn higher wage
To reduce unit cost
To give rewards
Control over labor
Greater output

11. Practical study
of

12. Introduction
Summit Bank Ltd is one of the fastest
growing commercial banks of Pakistan,
which, in a very short span of time, has
expanded its network across the country
On 18th
August 2010, Arif Habib Bank Ltd
was rebranded as Summit Bank Ltd.

13. Incentives given by Summit
Bank are:

14. 1. Medical incentive
In summit bank the medical incentive is
given to all the employees of the bank and to
their family members.
The complete medical facility is given to the
employees and their family members for the
whole year.

15. 2. Commission
The commission is given to all the low level
employees like guards, sweepers of the bank.
The criteria for the commission is that
employees should have their 60% of salary in
current account and remaining 40% in saving
account per month in the summit bank.

16. 3. Gifts
The gifts are mostly given to the Marketing
employees of the bank on their achievement of
the tasks or goals assigned to them with in the
given period of time and to maintain that given
tasks. The gifts are LCDS. BIKES, CARS
ETC.
The gifts are given throughout the year After
completing of tasks.

17. 4. Entertainment allowance
The other incentive given by the summit
bank is the Entertainment allowance. This
allowance consists of TEA and other
refreshments.
The Entertainment allowance is given on
daily basis from the guards to the manager of
the bank.

18. 5. Gratuity fund
The gratuity fund is created for all the
employees. The fix percentage from salary is
deducted and added in the fund. The bank also
contributed the same amount of percentage in
that fund.
The amount from gratuity fund is given to the
employees after their retirement from the bank.

19. 6. Refreshment packages
The refreshment packages are given to the
employees of the bank at 4 times in a year.
The refreshment packages are given
quarterly at every year. The employee can
take it whenever they want in one quarter.
The fix amount is given to the employees
according to their posts.

20. SWOT Analysis

21. Strengths:
good incentives plan for low level
employees.
Clear incentives plans for all the
employees.

22. Weakness:
No big incentives for high level
employees.
No proper implementation on
incentives plan.

23. Opportunity
They have the opportunity to start the
pension scheme for the employees.
They can also give the house
incentives to the employees.

24. Threats
The incentives plans of competitor banks
are the main threats which are attracting
the employees of the bank.
The pension scheme of National Bank of
Pakistan is also the threat for the summit
bank.

25. Conclusion
Wage system that rewards a worker for
productivity above an established standard.
Incentives by way of bonus, etc are offered
to efficient workers for the time saved.
The incentives given by summit bank are
Bonus,comission,refreshment package and
gifts to their employees.

26. Suggestions
They should start the pension scheme for
the employees.
Plan more incentives to high level
employees.
They should also give the house incentives
to the employees.