Day: July 2, 2022

After a very successful year in 2021, the Staffordshire Mining Company gave all of its mining employees an extra £6,000, and equivalent of two month’s wages.

This payment can be BEST described as ……?

Select ONE answer:

1. performance related pay
2. job enrichment
3. piecework
4. a bonus

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct – performance related pay is linked to whether an employee has met their individual targets whereas every employee receives this bonus no matter if they have met their own targets.
2. Not correct – job enrichment is when employees are given more responsibility and more meaningful tasks and has no connection to any form of financial remuneration.
3. Not correct – piecework is when employees are rewarded individually according to how much they produce whereas a bonus is paid collectively.
4. Correct – Definition of a bonus e.g. an extra payment made in recognition of the contribution of employees, often linked to profits and sales. This is in addition to their normal salaries/wages and is a one off payment. The bonus is paid to all employees as a recognition of the good performance of the business.

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