A cherry grower in the Yakima Valley, Washington, who splits a $6,000 bonus among six pickers by gut feel can lose $4,400 of fruit on top of the money paid (example figures). In a study of factory workers in India, those who learned they were paid less than both co-workers produced 22% less. Five pickers who each bring in $400 of cherries a day and pick 22% less over the ten peak days that follow leave $4,400 on the trees. So write the bonus rule before the period starts, give a copy to every picker, and say out loud what earned each payment.
The rule fits on one sheet of paper. The front is the bonus page: the goal, the amount, how the money is split, the pay date, what cancels the bonus and the date the crew received the sheet. The back is the thank-you rule: what kind of work earns thanks that cost no money, written so anyone on the crew can meet it, and the form the thanks takes.
Why does the crew see favoritism where you see merit?
Because the crew sees the amount and not the reason, and an amount with no visible reason looks like a choice about the person. Economists Emily Breza, Supreet Kaur and Yogita Shamdasani hired 378 workers in Odisha, India, for one month of seasonal factory work. Managers kept wages secret, yet 86.6% of workers could report what both co-workers in their unit earned by the end of the month.
A worker paid less than both co-workers produced 22% less and showed up 12 days fewer in every 100 due. The drop appeared only when the reason for the gap was not clear. Where the higher-paid co-worker was visibly more productive, there was no drop. The study was in a factory, not on a farm.
Gregorio Billikopf, a farm labor specialist at the University of California, draws the same line on farms. With a structured incentive, a reward whose rule is known in advance, workers understand ahead of time the precise relationship between performance and reward. With a casual incentive, a reward at a moment of the supervisor’s choosing, the drawbacks he lists include envy and the feeling that the supervisor acts out of favoritism. Paying in private reduces the comparison, but the sense that rewards are arbitrary may remain. So keep the amount private and say the reason out loud.
Favoritism can also be real. On a large UK fruit farm, field managers earned a fixed wage and assigned the rows. A picker produced between 5% and 9% more on days when he shared a nationality, a living area or an arrival date with his manager, the economists led by Oriana Bandiera found. When the farm began paying managers a bonus on the crew’s average output, the tie stopped mattering and the managers put their effort into the most able pickers.
So the rule has to bind whoever hands out the reward, not only you. If a foreman decides who gets a bonus or a day off, give him the same sheet. Which decisions are his alone is the subject of what your manager decides without asking you.
Say the reason out loud at every payment, starting with the next one.
What goes on the bonus page before the period starts?
Six lines, all decided before anyone knows who will earn what. Teagasc, the Irish state agency for agriculture and food, says an incentive plan should be in writing, set realistic and attainable goals and identify the baseline figure above which the incentive applies. The goal works only as a number the crew can change through their work. If the weather or the price decides it, the bonus pays for luck.
For a cherry crew, a bonus for staying to the last picking day is a goal every picker controls. Billikopf describes growers who pay a per-box incentive to workers who stay to the end of the season. Write the last day, the amount per box and the pay date on the page.
What cancels the bonus has to be tied to what the bonus pays for and said in advance. For the stay bonus, it is leaving before the last day, and nothing else. Once the rule is set, you can make it easier, never harder. Billikopf tells of a grape grower who cut his rate per vine from 32 cents to 28 and saw half the crew leave within a week.
Write the six lines this week, before the next pay period begins.
How should you split the bonus?
The split is how the money is shared among the crew. Depending on the split, the crew pulls together or apart, and every split has a cost.
| The split | Who gets what | What it costs |
|---|---|---|
| Equal parts | $1,000 each, whatever each one did | Nothing to explain, but the fastest pickers may slow down |
| One prize for the best | $6,000 to one picker, nothing to the other five | Only the few at the top compete; the rest ignore it or resent it |
| A bar anyone can clear | $1,500 each to the four who clear it, nothing to the two who did not | Less per winner than one prize, and the two who missed know by how much |
| Each picker’s own count | In proportion to the boxes each one picked | Works only on a number the picker controls and cannot inflate |
Equal parts look safest and still cost. Billikopf reports a foreman who saw that, under a group incentive, the fastest workers would slow down the most.
One prize for the best moves only the top. Billikopf finds that an employee-of-the-month contest takes place among about the top 15% of the workforce. He advises designing the award so that every worker who passes a set performance level can earn it, even if each award is smaller.
Paying by each picker’s own count gives the clearest link between effort and reward, provided the count is one the picker controls. That check is the subject of how to test a bonus number before you pay on it. Whichever split you choose, choose it before the period starts, before anyone can say it was tailored to a name.
A share of the farm’s profit is a poor bonus. Billikopf notes that weather, markets and the farm’s own accounting move profit along with the crew’s work. He adds that workers do not always see a link between their efforts and profits. He tells of a manager who got a large profit-sharing check one year, a much smaller one the next, felt defrauded and left. Tax and payroll treatment of a profit share are questions for your accountant.
Pick the split today and write it on the front of the sheet.
What about a thank-you that costs no money?
Billikopf warns that a bonus given routinely soon becomes part of the pay people expect. He finds that a thank-you naming the reason, such as fewer machinery breakdowns at harvest, works better than a general thanks.
Economists led by Christiane Bradler hired 363 people, mainly students, for a three-hour data-entry job, eight to a room. After two hours, an unannounced thank-you card for the best three of the eight raised later output, mostly among those who got no card. The study was not on a farm. Nobody knew when the card would come, but the reason was plain: it went to the three best. So for a thank-you, what you write in advance is the criterion, meaning what earns one, and not the moment.
On a cherry farm, write that criterion in terms anyone can meet: every row picked clean inside the window, a week without a rejected bin, a sick co-worker’s shift covered without being asked. Leave out yield and price, which no picker controls. It is the same idea as reviewing people on criteria they knew in advance.
Write the criterion for your first thank-you on the back of the sheet.
What do you write first, and how long does it take?
About an hour and one sheet of paper, before the season or year the bonus covers begins. Write the front first, because the back depends on knowing what the bonus pays for. Then hand it out.
The fixed wage for each job, paid with or without a bonus, is a separate decision, and setting a pay band and a raise rule for each job covers it. Other written rules for a crew are in the library’s articles on people, part of managing the whole farm.