System of Payment by Results

Manawatu Times, Volume 65, Issue 228, 26 September 1940, Page 8

System of Payment by Results

PRODUCTION SLOWED UP Per Press Association. WELLINGTON, Sept. 25. In a speech at the opening of the Smployers’ Federation conference, the president, Mr. W. Machin, emphasised two matters he considered important at :he present time —production which is rital to our prosperity, and the proposal :hat the decisions of the Arbitration Court shall in future be subject to appeal. After stating that New Zealand’s great production in primary industries had been based on payment by results, ne said he was certain that New Zealand was missing the highest production in many industries where wages were being paid at time rates, particularly in the present atmosphere of strictlylimited working time by-lav/. Therefore, for the duration of the war at least, he thought that we should revert, wherever possible, to piece work and payment by results, and suspend for the time being the present rigid limitation of working hours, which he was sure was inducing in many earners, consciously or unconsciously, limitation of effort, which was slowing up production.

He quoted the Government Statistician’s estimate of factory production for the years ended June 1939 and 1940. It was £3o£-million in each case, which, If it turned out correct, showed that production last June must be lower, because prices had risen and the value wai estimated at no more. If the Prime Minister’s exhortation to “work for your lives” was to be given the meaning he intended and the meaning this grave hour demanded, it was surely not too much to ask that serious consideration should be given the question of payment by results. In regard to the Arbitration Court, he said that if trade and industry were to flourish, it must be recognised that arbitrary apportionment of wage charges on industry on the basis of an assumed and anticipated volume and price return which might or might not eventuate must give way to a sounder and more ordered method, otherwise industry might languish, because it would lose part of its intangible but most important capital—enterprise and willingness to adventure—because of arbitrary and discouraging impositions by the power of the State.

Before, therefore, the State wielded this power, it should be satisfied, and all concerned should be satisfied, that judgments which might seem to be illfounded had been impartially reviewed.