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Incentive Pay Forms of pay linked to an employee's performance as an individual, group member or organization member. Piecework Rate Wage based on the amount workers produce. Straight Piecework Plan Incentive pay in which the employer pays the same rate per piece, no matter how much the worker produces. Differential Piece Rates Incentive pay in which the piece rate is higher when a greater amount is produced. Merit Pay System of linking pay increases to ratings on performance appraisals. Gainsharing Group incentive program that measures improvements in productivity and effectiveness and distributes a portion of each gain to employees. Scanlon Plan Gainsharing program in which employees receive a bonus if the ratio of labor costs to the sales value of production is below a set standard. Profit Sharing Incentive pay in which payments are the percentage of the organizations profits and do not become part of the employees base salary. Employee Stock Ownership Plan (ESOP) Arrangement in which the organization distributes shares of stock to all its employees by placing it in a trust. Balanced Scorecard Combination of performance measures directed toward the company's long and short term goals and used as the basis for awarding incentive pay.