Wage Transformation Through
Productivity-Linked Wage System
(PLWS)
Sugumar Saminathan
Manager,
Malaysia Productivity Corporation
Tel: +603-79557266 ext 544,DL: +603-79562566,
Mobile:+6019-6354078
E-mail:sugumar@mpc.gov.my
Website:http//www.mpc.gov.my
Ministry of International Trade and Industry (MITI)
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BUSINESSMAN:
“Productivity is
reducing cost and
increase profits.”
CONSUMER:
“Productivity bring good
quality products and
services at cheaper
prices and higher living
standards.”
I
PROD
T
I
UCTIV
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WHAT IS PRODUCTIVITY?
Productivity is a measure of
efficiency in the use of inputs or
resources in relation to its outputs
5 WAYS OF IMPROVING
PRODUCTIVITY?
5 Ways
Firm Approach
Output
Productivity
=
O
Reduce Cost
Input
Output : Goods & Services
Input
Manage Growth
: Resources Used
Output
●Gross Domestic Product
(GDP),
● Total Output,
● Added Value,
● Monetary Value of
Production,
● Quantity of physical unit
produced
I
O
I
Input
● Employees,
● Total man-hours worked
● Labour cost,
● Capital/Fixed assets, ●
Energy,
● Material,
● Services
O
Work Smarter
I
Pare Down
O
I
O
Work Effectively
I
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PRODUCTIVITY IS VALUE CREATION
Create/Add Value
Product Innovation
IS YOUR COMPANY CREATING VALUE?
i-COMPASS
i-COMPASS is a self learning application
tool that help companies to compute the
wealth company created
employees efforts
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by its
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own and
WORK SMART = HIGHER PRODUCTIVITY
People
Plant & Equipment
Work environment
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CONTENTS
LABOUR COMPETITIVENESS
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LABOUR PRODUCTIVITY
_ ADDED VALUE PER EMPLOYEE
Indicates the added value genarated by an employee.
A high value indicates high productivity of an employee
_ TOTAL SALES PER EMPLOYEE
Indicates the total sales genarated by an employee.
A high value indicates high productivity of an employee
_ TOTAL OUTPUT PER EMPLOYEESS
Indicates the total sales genarated by an employee.
A high value indicates high productivity of an employee
_ TOTAL OUTPUT PER MAN HOURS
Indicates the total output genarated by an employee per hour.
A high value indicates high productivity of an employee
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LABOUR COMPETITIVENESS
_ ADDED VALUE PER LABOUR COSTEE
Indicates how competitive the company is in terms of Labour
Cost. A low ratio indicates high Labour Cost
_ LABOUR COST PER EMPLOYEE
Indicates the average remuneration per employee
A high value means high returns to individual workers and
vice-versa.
_ UNIT LABOUR COST
Show the proportion of Labour Cost to Total Output
A high ratio indicates high Labour Cost
_ TOTAL OUTPUT PER LABOUR COST
Indicates how competitive the company is in terms of Labour
Cost. A low ratio indicates high Labour Cost
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CONTENTS
PRODUCTIVITY AND QUALITY
ENHNACEMENT PROGRAMME
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17
Lean Management System
Lean
Manufacturing
Type
of
Lean
Lean Service
•
•
•
•
•
•
VSM
Poke-Yoke
TPM
Kanban
5S
SMED
Lean Government
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• Transformatio
n
• Creativity
• Innovation
• Wastages
• Matlamat
Organisasi
Continues
Implementation
&
Impact
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‘Famous’ 7+1 types of wastages
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PRODUCTIVITY : WEALTH CREATION AND SHARING
Baking & sharing a bigger
economic cake
PRODUCTIVITY -LINKED WAGE SYSTEM
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Why Do We Need To Restructure
Our Wages?
• A flexible and competitive wage system will enable
companies to make quick adjustment to wages that
will ensure job stability and reduces the likelihood
of retrenchment in the event of an economic
slowdown.
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What Is Wage Restructuring
•Wage restructuring is about making wages more
flexible and competitive.
•In good times, employees can look forward for
bigger bonuses and better incentives when both
company and employees performance well.
• In bad times, employees will have greater job
security as company can make quick adjustment
on wages to avoid retrenchment.
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For flexible and competitive wage system
that ensure job stability and reduces
retrenchment in the event of an
economic slowdown.
“PLWS The Way Forward”
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When Do Company Implement PLWS?
• PLWS should be implement when the company
want to enhance its competitiveness and improve
productivity.
• The company want to reward good employees
and motivate average employees.
• The company want create harmonious
labour relation and create win-win situation.
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Productivity-Linked Wage System
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PRODUCTIVITY- LINKED WAGE SYSTEM (PLWS)
PLWS is a wage system which establishes a link between wages
and productivity/performance.
PLWS ensure any increase in wages commensurate with
increase in productivity/performance.
PLWS enables employees to obtain a fair share of gains that
arise from productivity growth and performance improvements.
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Malaysia’s Policies on Linking Wages To Productivity
Guidelines on Wage Reform was established
in August 1996 with the following objectives:
i) Establish a closer link between wages
and productivity
ii) Develop a wider and systematic
approach
towards improving productivity and
wages
iii) Ensure active involvement and
cooperation of employees to develop
PLWS
iv) Ensure that employees obtain a fair
share of gains from productivity growth
and performance
improvements
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PHASES IN IMPLEMENTING PLWS
PHASE 1
PHASE 2
PHASE 3
Creating Conducive Environment
Establishing PLWS System
Implementing PLWS System
MPC PLWS MODEL
Start
1. Create awareness on PLWS
among management team
2. Measure company’s
performance
3. Develop PLWS Committee
4. Developing Corporate,
Division & Unit KPI
5. Briefing Session with
Company’s Workers
6. Obtain feedback from
employees and management
7. Linking Incentives with
Improvement
8. Establishing PLWS on a trial
basis
9. Review and make the
necessary adjustments
10. Implement PLWS at the
firm level
11. Plan (continuous
Improvement)
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COMPONENTS OF PLWS
FIXED
COMPONENTS
VARIABLE
COMPONENTS
BASIC WAGE
ANNUAL
INCREAMENT
Wage increase
for the year
based on:-
Productivity, or
Profit sharing
formula
There must always be the fixed
and the variable component in the
PLWS
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PLWS Model 1:
Profitability Model
#1
• Payment of bonus according to profit
levels based on monthly basic pay.
Profit After Tax
(RM Million)
<1.5 (threshold)
Bonus
[Month(s)Salary]
0
1.5 - 1.99
0.5
2.0 - 2.49
1.0
2.5 - 2.99
1.5
2.0
3.0 and above
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PLWS Model 1:
Profitability Model
#2
• Bonus payments paid in quantum
(RM)
Profit Before Tax
(RM Million)
Bonus
(RM)
<5 (threshold)
0
5-7
500
7-9
1,000
9 - 11
1,500
2,000
11 and above
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PLWS Model 2:
Productivity Model
#1
• Bonus paid out at the end of the
financial year based on saleable
output.
Production
Volume (000 m2)
(Saleable Output
<5,500
<5,600
<5,750
<6,000
<6,250
<6,500
Bonus
(Months)
0
0.25
0.75
1.25
1.75
2.00
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PLWS Model 2:
Productivity Model
#2
• Incentives given based on the
productivity targets achieved
(Individual).
Planned Target
Actual Achievements
Incentive (RM)
80%
Above 100%
150
80%
91 – 100%
100
80%
80% - 90%
50
80%
Below 80%
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PLWS Model 2:
Productivity Model
#3
• Incentive given base on identified
monthly productivity indicators and
linked to the team incentives (Team).
Performance
Criteria
Performance
Standard
(Target)
1.
Production targets
Above 80%
2.
Quality output
Above 90%
3.
Customer
complaint
Zero complaint
4.
Maintenance
5.
Discipline
No machine
breakdown
• If team of 5 employees able
to achieves all 5 criteria 
RM100/ team member
• If team achieves only 2
criteria  No incentives
No. of
Criteria
Achieved
Incentives
(RM)
5
100
4
80
3
60
2
0
No reminder or
1
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PLWS Model 3:
Combine Model
#1
• Payment of bonus according to 2
criteria – Company Performance and
Employee Performance Rating
Operating Profits
(RM Million)
Above 5.00
Variable Productivity payment (Months)
1.00
1.00
1.25
1.50
1.75
2.00
4.00 – 5.00
0.75
0.75
1.00
1.25
1.50
1.75
3.00 – 4.00
0.5
0.5
0.75
1.00
1.25
1.50
2.00 – 3.00
0.25
0.25
0.5
0.75
1.00
1.25
Below 1.00
0
0
0.25
0.5
0.75
1.00
70 - 79
>80
Employee Performance Rating
<40
40 - 49
50 - 59
60 - 69
(%)
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PLWS AND ITS IMPACT
Companies with PLWS Elements in
Collective Agreements
Impact of PLWS Implementation
2001 ~ 2004
2005 ~ 2008
691
1,566
2006 (%)
2008 (%)
Productivity
2.64
5.17
Staff Turnover
5.21
2.13
Absenteeism
8.80
4.17
Rejects and Reworks
5.33
2.85
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INDUSTRIAL RELATIONS
(AMENDMENT) ACT 2007
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Section 13: Collective Bargaining
(2A)
A proposal for a collective agreement
may provide for one or more of the
following:
(a) provision for training to enhance skills
and knowledge of the workmen;
(b) provision for an annual review of the
wage system; and
(c) provision for a performance-based
remuneration system.
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PLWS in
Collective Agreement
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DISTRIBUTION OF COLLECTIVE AGREEMENT (CA) WITH PLWS BY SECTORS –20102012
Sector
Total Number of Collective
Agreement
Number of CA / Percentage With PLWS
2010
2010
2011
2011
2012
2012
No.
%
No.
%
No.
%
Manufacturing
195
180
147
144
73.85
129
71.67
125
86.81
Services
116
117
127
88
75.86
95
81.20
111
87.40
Agricultural
17
17
13
15
88.23
17
100.00
13
100.00
Others
2
6
9
2
100
6
100.00
7
77.78
Total
330
320
293
249
75.45
247
77.19
256
87.37
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ELEMENTS OF PLWS IN CA BY SECTORS, 2012
No
Elements
Manufacturing
(125)
Services
(111)
Agricultural
(13)
Construction
(3)
Quarry & Mining
(4)
88
(70.4%)
37
(29.6%)
7
(5.6%)
17
(13.6%)
51
(45.9%)
31
(27.9%)
3
(2.7%)
30
(27.0%)
1
(7.7%)
2
(15.4%)
1
(33.3%)
1
(33.3%)
2
(50.0%)
2
(50.0%)
-
-
-
3
(23.1%)
1
(33.3%)
-
115
(92.0%)
23
(18.4%)
106
(95.5%)
26
(23.4%)
5
(38.5%)
2
(66.7%)
-
-
-
-
-
-
-
2
(15.4%)
-
-
-
-
-
-
-
-
Bonus Payments
1.
Contractual Bonus
2.
Bonus Based on Management Discretion
3.
Fixed and Additional Bonus
Bonus Based on Profit/ Company
Performance
Annual Increment
4.
5.
Yearly Increment
6.
Increment based on Merit
2
(50.0%)
1
(25.0%)
Incentives/Allowances
1
(0.8%)
1
(0.8%)
7.
Group Target
8.
Individual Target
9.
Service Charge
-
10.
Skill Allowance
5
(4.00%)
14
(12.6%)
7
(6.3%)
11.
Piece Rated Incentives
-
-
12.
Commitment / Attendance Incentives
13.
COLA
14.
Cost and Time Saving Incentives
59
(47.2%)
5
(4.0%)
-
11
(9.9%)
17
(15.3%)
-
15.
Price Bonus
-
-
16.
Long Service Award
9
(7.2%)
17.
Outturn Incentives
18.
Performance Allowances for Maximum Scale
Employee
19.
Trip Incentives
20.
Quality Service Allowance
21.
OMO Incentives
22.
Coaching/Teaching Allowance
23.
Productivity Payment
2
(15.4%)
3
(23.1%)
-
-
1
(33.3%)
1
(25.0%)
-
-
-
2
(15.4%)
-
-
-
-
21
(18.9%)
-
-
-
-
-
6
(46.2%)
-
-
-
-
-
-
-
2
(1.6%)
1
(0.8%)
9
(8.1%)
1
(0.9%)
12
(10.8%)
3
(2.7%)
-
-
1
(25.0%)
-
-
-
-
-
-
-
-
-
-
1
(33.3%)
-
2
(1.6%)
4
(3.2%)
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PLWS Examples.
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Example 1:
Incentive Based on Performance and Productivity
Wage System
Fixed
Components
Basic Pay
Wage
Variable
Components
Min.
Annual
Increment
Profitability
Productivity
Incentives
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Combined
Variable Components
Profitability Incentive – the profitability incentives will be pay when
the profits fall within a predetermined range as shown in
Diagram : Profit Sharing
Profitability
Profit sharing formula to determine
“money in the pot”. The wage
incentive will only be given if the
profit falls within a predetermined
range
Total Bonus = Profit After Tax
Monthly Payroll Cost
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Example of profitability Incentives
The bonus will be paid when the company makes certain amount of
profit that falls within a predetermined range.
Table : Profitability Incentives
Profits After Tax
(RM Million)
Monthly Payroll Cost
(RM Million)
Bonus =
Profit After Tax
Monthly Payroll Cost
Less than 5
5
0
5
5
1month
6
5
1.2 month
7
5
1.4 month
8
5
1.6 month
9
5
1.8 month
10
5
2.0 month
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Productivity Incentives
The incentives will based on team and individual performance
against predetermine productivity measurement.
Diagram: Productivity Incentives
Productivity
Based on team and individual performance
against predetermined productivity measurement
• Total output
• Quality output
• Wastages
• Customer Satisfaction
• Individual Performance
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Matrix incentives
Matrix incentives will be given based on the profitability and average
performance of division, department and individual as shown below.
Profits
(RM million)
Incentives (Months)
Less 5
0
0.1
0.3
0.5
5- 7
0.1
0.3
0.5
0.7
7-9
0.2
0.5
0.7
1.0
9-11
0.3
0.7
1.0
1.3
11-13
0.4
1.0
1.5
2.0
13-15
0.5
1.5
2.0
3.0
Average
Performance
(%)
Less 70
70 -80
80-90
90-100
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If the company performance are as follows:
• Division Performance is 85%
• Department Performance is 90%
• Individual Performance is 85%
• Average Performance of an employee is 86.7%
• Based on the calculation above the respective employee will
received 2 months bonus if the company makes RM 13 million
profits .The incentives taking into consideration the overall
employees performance. In order to received higher quantum
of bonus each employees should contribute to the division
and department performance as well as their own
performance.
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There are two components in this model, the fixed and
variable components.
The Fixed Component comprises:
•Basic Wage
The basic wage comprises the monthly wage which is based
on a salary scale with a minimum and maximum range for
each category of employee.
•Annual Increment
The annual increment is linked to the basic wage and will vary
within the scale of pay assigned to the position.
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Example 2. Profit Sharing and Team Incentive
There are two types of incentives which are linked to
productivity/performance:
• Bonus Based on Profit and Individual Performance
• Team Incentive
Bonus Based on Profit and Individual Performance
•The profit used in this model is Profit Before Tax which will be
distributed to employees based on profit level and performance.
The higher the firm’s profitability, the larger will be the amount
available for sharing.
•Table below shows an example the matrix system of bonus
payment. Based on this matrix, the amount of bonus payment
received by an employee will depend on the profitability of the firm
and employee performance.
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Profit Sharing Incentive Matrix
Profit (RM million)
Variable Incentive Bonus (Months)
> 12
0
0.3
0.5
1.0
1.1
2.1
9-12
0
0.2
0.3
0.9
1.0
1.5
6-8.9
0
0.0
0.2
0.8
0.9
1.3
4-5.9
0
0.0
0.1
0.7
0.8
1.1
<4
0
0.0
0.0
0.5
0.6
0.9
Employee
Performance Rating
(%)
<40
40-49
50-59
60-69
70-80
>80
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Example 3. Profitability-Based Increment and Bonus
• The annual increment is based on the ROI
(Returns on Investment) while the individual
performance is based on the performance
appraisal.
• Grade A performance will receive a 6%
increment compared to 5%,4% and 3% for
Grades B, C and D respectively (as in the Table
below)
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Increment Based on ROI and Individual Performance
ROI Achievement
Below 0%
0% - 30%
Employee Individual
Performance/Increment
Grade A Grade B Grade C Grade D
2% or minimum RM20 whichever is
higher
5%
4%
3%
2%
31% - 60%
6%
5%
4%
3%
61% - 100%
7%
6%
5%
4%
Above 100%
9%
8%
7%
6%
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 Another aspect of this system is that the ROI achievement
also determines the quantum of bonus to be paid.
 If the quantum of ROI achieved is 23% then the firm will
declare a bonus of 0.5 month basic salary.
 However, if the firm achieves an ROI more than 100% then
each employee will be given a bonus of between 1.0 to
1.5 months subject to the discretion of the firm and
employee performance.
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Profitability Bonus
ROI Achievement
No. of Months
Below 0%
0.5 month
0% - 30%
0.6 month
31% - 60%
0.7 month
61% - 100%
0.8 month
Above 100%
1.0 months
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Example 4. Bonus Based on Company and Individual
Performance
 The manufacturing
firm in this example shall pay
performance bonus based on the company and the
individual performance.
 The company performance shall be based on
achievements against business plan of the year and
employee performance shall be based on the
performance appraisal rating and points awarded in
accordance to their annual appraisal
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Bonus Based on Company and Individual Performance
Company Performance Based
below
85% -
101% -
121% -
Above
on Business Plan
85%
100%
120%
140%
140%
Individual Performance
Bonus Payout
Unsatisfactory
below 40%
0
0.1
0.2
0.3
0.4
Average
40% - 54%
0.3
0.4
0.5
0.6
0.7
Good
55% - 69%
0.5
0.7
0.9
1.1
1.3
Very Good
70% -85%
0.7
1.0
1.3
1.6
1.9
Outstanding
above 85%
1.0
1.3
1.6
1.9
2.2
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 If
the company’s performance rating is 100% and
individual performance is 75% which is “very good”,
then the quantum of bonus that will be granted to the
employee will be 1.0 month. Therefore, this clearly
indicates that whenever both parties i.e. employees and
firm perform very well, there will be higher quantum of
bonus distributed among the employees.
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Example 5. Debt Incentive Collection
Debt Collection
Current
30 days
60 days
90 days
<RM100,000
2.0%
1.5%
1.0%
0.5%
RM100,000200,000
1.0%
0.5%
0.25%
0.1%
>RM200,00
0.5%
0.25%
0.1%
0.05%
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Example 6. Bonus Based on Company and Individual
Performance
 The manufacturing
firm in this example shall pay
performance bonus based on the company and the
individual performance.
 The company performance shall be based on
achievements against business plan of the year and
employee performance shall be based on the
performance appraisal rating and points awarded in
accordance with their annual appraisal.
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Bonus Based on Firm and Individual Performance
Firm Performance (Profit Before
Interest and Tax (PBIT)- RM
million)
<5
5-10.99 11-15.99
Individual Performance
16-20 >20
Bonus Months
Poor (Less than 40%)
0
0
0
0
0
Satisfactory (40-64%)
0.5
0.5
0.5
0.5
0.5
Good (65-74)
1.00
1.25
1.50
1.75
2.00
Very Good (75-85)
1.25
1.50
1.75
2.00
2.25
Excellent (85 and above)
1.50
1.75
2.00
2.25
2.50
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Example 7. Rework Incentives
Incentives will be paid when there is reduction in rework rate.
Planned Rework
Actual Acheivements
Incentives (RM)*
10% of the monthly
output
10% of the monthly
output
10% of the monthly
output
10% of the monthly
output
10% of the monthly
output
> 11%
0
8%-10%
10.00
5%-7%
15.00
2%-4%
20.00
0-1%
25.00
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Example 8: MERIT AND PROFIT SHARING SCHEME
The Scheme consist of two components:
(a) Fixed Component which comprises of basic wage plus an
annual increment of 3%of basic salary and an annual bonus
of one month’s basic salary.
(b) Variable Component. Among the tools used to determine
the variable component are profit sharing and personal
performance review (PPR).
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PROFIT SHARING
• Shareholder’s fund = RM 2.0 million
• Retained Earnings = 12 .5% x RM 2.0 =RM 250,000
• Profit after tax
= RM 1.0m
• Amount for sharing = RM 1.0 m - RM 250,000
= RM 750,000 m
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DISTRIBUTION OF PROFITS
(i) 50 per cent of profits to shared
available for sharing
Total Payroll
=
RM 375,000
RM 500,000
=
0.75 months
basic salary
for each employee
(ii) 50 per cent to be distributed based on employees
performance using the Personal Performance Review
(PPR)
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Employees
PPR Score
Salary (RM)
Bonus Score
(PPR Score X Salary)
1
70
700
49,000
2
75
800
60,000
3
80
700
56,000
4
85
900
76,500
5
80
1000
80,000
6
75
1100
82,500
7
90
950
85,500
8
95
1050
99,750
9
70
850
59,500
10
80
750
60,000
11
80
900
72,000
Total
780,750
Transformation • Innovation • Partnership
If the company decide to allocate RM11,000 for a unit of 11 employees,
based on the basic salary and Personal Performance Review Scores
(PPR) as indicated, the employees will receive the following bonus
points:
Bonus payment = 11,000
------------- = 0.0149
780,750
Each employee in the unit will get the following bonus payments
based on PPR scores as shown in table:
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67
Employees
Bonus Score
(PPR Score X Salary)
Bonus Point
Bonus Received
(RM)
1
49,000
0.0149
730.00
2
60,000
0.0149
894.00
3
56,000
0.0149
834.00
4
76,500
0.0149
1,140.00
5
80,000
0.0149
1,192.00
6
82,500
0.0149
1,229.00
7
85,500
0.0149
1,274.00
8
99,750
0.0149
1,486.00
9
59,500
0.0149
887.00
10
60,000
0.0149
894.00
11
72,000
0.0149
1,073.00
Transformation • Innovation • Partnership
Total bonus paid based on profitability and performance:
Employees
Profitability
Bonus
(Months Bonus)
Performance Bonus
(Months Bonus)
Total Bonus Received
(Months Bonus)
1
RM 525 (0.75 Mths)
730 (1.04 Mths)
1,255 (1.79 Mths)
2
RM 600 (0.75 Mths)
894 (1.12 Mths)
1,494 (1.87 Mths)
3
RM 525 (0.75 Mths)
834 (1.19 Mths)
1,359 (1.94 Mths)
4
RM 675 (0.75 Mths)
1,140 (1.27 Mths)
1,815 (2.02 Mths)
5
RM 750 (0.75 Mths)
1,192 (1.19 Mths)
1,942 (1.94 Mths)
6
RM 825 (0.75 Mths)
1,229 (1.12 Mths)
2,054 (1.87 Mths)
7
RM 713 (0.75 Mths)
1,274 (1.34 Mths)
1,987 (2.09 Mths)
8
RM 787 (0.75 Mths)
1,486 (1.42 Mths)
2,273 (2.16 Mths)
9
RM 638 (0.75 Mths)
887 (1.04 Mths)
1,525 (1.79 Mths)
10
RM 563 (0.75 Mths)
894 (1.19 Mths)
1,457 (1.94 Mths)
11
RM 675 (0.75 Mths)
1,073 (1.19 Mths)
1,748 (1.94 Mths)
Transformation • Innovation • Partnership
Example 9: Performance Incentives Allowance
• The company decided to reward employees which already reach their
maximum salary. Employees who have reached the maximum on their
salary scale and have performed commendably during the period of
review, shall be eligible for a monthly allowance for the next 12 month.
Performance Incentives Allowances shall include the following category of
performance as shown in table below.
Performance Category
Monthly Allowance
Highly Effective
RM 60.00
Competence
RM 40.00
Transformation • Innovation • Partnership
Example 10: Monthly Performance Incentives Scheme
The company will pay performance incentives based on the qualifying
criteria set by the company. Each employee must meet all the criteria to
be eligible for the incentives. The amount of the incentives will increase
from month to month. For example in an employee can achieved all the
criteria for January to December than the total incentives received by
the employee will be RM 750.00 (Table 6). However if the employee fail
to meet any one of the qualifying criteria in any given month will render
the employee to restart at the minimum amount of RM 35 per month upon
meeting the qualifying criteria for the month.
Qualification Criteria:
a. Nil late attendance for that month except with valid late comings reasons needs to
be approved by respective Head of Department.
b. Nil absenteeism for the month except with valid reasons needs to be approved by
respective Head of Department
c. Only one (1) medical leave for the month
d. Nil disciplinary record for the months i.e. written counseling , warning letter
Transformation • Innovation • Partnership
Months
Monthly Amount
(RM)
Accumulated Monthly Amount
(RM)
January
35
35
February
40
75
March
45
120
April
50
170
May
55
225
June
60
285
July
65
350
August
70
420
September
75
495
October
80
575
November
85
660
December
90
750
Transformation • Innovation • Partnership
PLWS Model
Bonus Based on Profits/Returns
Bonus based on Sales/Total Output
Increment Based on Performance
Incentives based on employees quality
Incentives Based on Individual/Team/
Company Performance/Target
Incentives Based on Skills
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• Innovation
• Partnership
Transformation,
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PLWS COMMITTEE
Advisor
(Directors)
PLWS Committee
i. Head of each Department
ii. HR Department (Secretariat)
iii. Employee representative
Production
QA
Maintenance
Safety & Health
Sales & Delivery
HR / Finance
Procurement
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THE COMMITTEE’S TERMS OF REFERENCE
(TOR)
To identify Key Performance Areas and Key Performance
Measure that has an impact on company performance;
1
2
To identify the key player or the PICs
(company/department/unit);
3
To facilitate the implementation of the Key
Performance Areas;
4
To monitor the achievement of the Key
Performance Indicator;
5
To engage the relevant stakeholders for further
deliberation on initiative to achieve the targeted KPIs;
6
To develop the linkages between wages and
productivity; and
7
To act as a mediator and reconcialter on PLWS
implementation.
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Transformation • Innovation • Partnership