Halsey Premium Plan

Halsey Premium Plan

Halsey Premium Plan was developed by F. S. Halsay of Canada. Under this plan also the production output, time and wages are determined beforehand. The workers are given predetermined minimum wages whether they complete the amount of work in the given time or not. But those workers, who complete their work well before the given time are provided a percentage of their wages as a premium as per the amount of time saved. This premium may range between 33.33% to 50% of the wages of the amount of time saved. Unlike Taylor’s premium plan, workers are assured a minimum wage under this wage payment system.


Fixed amount of work20 Units
Fixed time10 Hours
Minimum wages (per hour)$2.00
Rate of premium for completing work before the time fixed50%

The worker who produces less than 20 units in 10 hours will get the minimum wage of $20 (10 hrs. x $2 per hour) whereas, if a worker produces 20 units in 8 hours, then his wages will be calculated as follows

Wages of 8 hours = (8 x 2) + 50% x 2 hours x $2 per hour
= 16 + 50/100 x 4 = 16 + 2 = $18

If the worker’s speed is the same as fixed by the employees i.e.10 hours, then his wages will be as follows

Wages of 8 hours = $18

Wages of 1 hour = 18/8

Wages of 2 hours = $18/8 x 2 = $4.50

Wages for 10 hours = $22.50

Merits of the Halsey Premium Plan

  1. Both the employer and the workers are the beneficiary of this system because both share the profits derived from the time saved.
  2. Eạch worker gets at least the minimum wages and the more efficient workers get additional premiums as an incentive.
  3. There are not many changes in tensions between the employer and the worker regarding wage increases.

Demerits of the Halsey Premium Plan

  1. Due to the fixed minimum wages, the workers may neglect their work.
  2. To produce more and more output, the workers may waste or destroy the materials or machinery in haste.
  3. The decision of increasing production does not remain with the employer solely. It depends more on the workers, under their system.

Leave a Reply