2. Should other employees (cleaner/spotters, counter people) be put on a similar plan? Why? Why not? If so, how, exactly? The question of whether to pay Carter Cleaning Center employees an hourly wage or an incentive of some kind has always intrigued Jack Carter.

His basic policy has been to pay employees an hourly wage, except that his managers do receive an end-of-year bonus depending, as Jack puts it, on whether their stores do well or not that year.

However, he is considering using an incentive plan in one store. Jack knows that a presser should press about 25 tops (jackets, dresses, blouses) per hour. Most of his pressers do not attain this ideal standard, though. In one instance, a presser named Walt was paid $8 per hour, and Jack noticed that regardless of the amount of work he had to do,Walt always ended up going home at about 3:00 P.M., so he earned about $300 at the end of the week. If it was a holiday week, for instance, and there were a lot of clothes to press, he might average 22 to 23 tops per hour (someone else did pants) and so he d earn perhaps $300 and still finish each day in time to leave by 3:00 P.M. so he could pick up his children at school. But when things were very slow in the store, his productivity would drop to perhaps 12 to 15 pieces an hour, so that at the end of the week he d end up earning perhaps

$280, and in fact not go home much earlier than he did when it was busy