Salary based on productivity – this legal phrase finds application within the area of Labor Law. There it details a salary which employers pay on the base of production achieved by the employees. In simple words – the more you produce during your work, the bigger wage you will receive. It is economic effective and modern method of payment of salaries. This is because it connects the amount of awarded money, with the productivity of the employee. Such type of wage seeks two main goals:
– On one hand, to ensure the employer that his employees will be paid fairly for only what they have produced. And respectively they will not work slowly or ineffectively;
– On the other hand, it gives opportunities to the employee for bigger salary if they produce more.

Most jurisdictions have regulations controlling the working hours length for the protection of workers. This is to ensure that the employees won’t have to work over the 8 hours labor day while trying to achieve bigger salary.

See also “Employment and Labor Law”