Are employers allowed to pay a lower rate for piecework?
Yes, employers in Pennsylvania are allowed to pay a lower rate for piecework. According to the Pennsylvania Wage and Hour Law, employers are allowed to pay their employees based on the type of work they are performing. Piecework or “piece rate” is a form of payment in which employees are paid for each “piece” or item they produce in a set period of time. The rate of pay for piecework is typically lower than the rate of pay for hourly work. Employers also have the option to establish “bonus pay” for piecework, which is an additional payment based on the amount of items produced in excess of the minimum standard. However, employers are required to ensure that the total wage rate, including bonus pay, is at least equal to the minimum wage currently mandated in Pennsylvania. Employers may also offer their piecework employees a piecework bonus or incentive plan, which is a payment that rewards a worker for exceeding a certain level of productivity. However, employers are required to ensure that these bonus or incentive plans are applied in a fair, uniform, and nondiscriminatory manner. It is important that employers who use piecework as a form of payment are aware of the laws of Pennsylvania and comply with all regulations to ensure that their employees are paid properly and fairly.
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