Context: Fish Packaging Ltd, situated in Reykjavik, Iceland, is a firm packaging and selling frozen fish to the local market. Let's dive deep into the fishy situation they are facing! 🐟

Definition: A method where employees are paid based on the amount of time they work, typically by the hour.

• Features of a Time Rate Payment System:
•  Fixed Hourly Rate: Workers get a certain amount for every hour worked. For example, the employees at Fish Packaging Ltd receive €10/hour.
•  Compensation During Downtimes: If there's no work (like when the fishing boats don't sail), employees still receive a reduced pay. Here, they get €4/hour.

Definition: Workers are paid based on the amount of product they produce or tasks they complete.

• Advantage for Workers

  • More Money for More Work: If they pack more than 13kg of fish, they'll earn more than with the time rate.
  • Real-world Example: Imagine you're a gamer and get paid for every game you win. The better you play, the more you earn!

• Disadvantage for Workers

  • No Guarantee: If they can't pack enough due to reasons out of their control (like fewer fishes), their pay drops.
  • Real-world Example: It's like getting paid for every goal in soccer. If it's a tough match, you might not score and thus, earn nothing!