> why do companies pay by the hour?

why do companies pay by the hour?

Posted at: 2015-07-28 
I've noticed that all kinds of companies pay workers, particularly low-level ones, by the hour instead of by the task/commission/salary. What is the underlying purpose behind hourly pay? What's the goal, and what is it designed to reward? I just don't get it.

I'm a union Ironworker and my package is $72 hour, $42.90 is my hourly rate and if it is any time before 7 am, or after 3 pm (Mon-Fri.) it is double time. Like the other person said you don't want salary. They can take advantage of you. If I work 10 hours on a Sat, and 10 on a Sun. It is the same as if I worked all week.

Getting paid by the task is piece work. From the companies perspective, quality goes down because people cut corners, to increase numbers.

With an hourly wage they can estimate cost better. Example: It takes 2 hours to produce a widget. By adding the material, labor, overhead. They can figure the cost per widget.

Seems fair to me. A man does an hours work ,we pay him for an hours work, after 40 hours we paid them time and a half. Managers were paid on a salary, a set amount per year regardless of hours, but they did get an end of year bonus based on profits.

I never saw any reason to do it any other way

Simple math. It's perfect for budgeting. The goal is you work 40 hours you get paid for 40 hours. If you work 38 hours you get paid for 38 hours.

Salaried people can work 30 hours or 60 hours and get paid exactly the same. To me, this is stupid.

The reward is a pay check.

If people got paid by the task they would make a 2 hour job last a week.

Unions don't like piece work because it shows up the lazy time wasters. They say it discriminates against the slow staff.

The workers of low level are not normally very serious about their job,they keep on jumping every now and then,they also keep on remaining absent from their job.Hence paying them on monthly base is costlier affair to the employer.The employer are enable to get consistency out of their job,there fore they are paid by hours worked.