The time required to complete a job is established and a bonus is paid to the worker based on the exact % of time saved. This type of incentive plan is known as the Rowan Premium plan.

Rowan Premium plan is similar to that of the Halsey Premium Plan. The only difference is in regard to the determination of the premium. Unlike a fixed percentage in the case of the Halsey plan, it considers a premium on the basis of the proportion in which the time saved bears to the standard time.

• Under the Rowan plan, the premium is calculated on a percentage of wages for the time worked and not for the time saved. This gives more bonus to the workers.
• The time required to complete a job is established and a bonus is paid to the worker based on the exact % of time saved.
• Unlike a fixed percentage in the case of the Halsey plan, it considers premium on the basis of the proportion in which the time saved bears to the standard time.
• As per this plan, there is a guarantee of minimum wage with a time rate.
• But the worker has the right to get the bonus on the basis of his time saved.
• Bonus gradually increases with an increase in percent time saved, and reaches the maximum at 50% time-saved and becomes zero when time saved is 100%.
• Thus workers get benefited when the time saved is 50% only.

The bonus can be calculated by using the following formula.

E = (T × R + S − T)/(S × T × R)

where

E = Total Earning

T= Actual Time

S =  Standard Time

R= Rate per Hour