Lean Manufacturing

Should Cross-trained Workers be Paid More?

By Jon Miller Published on March 12th, 2009

“Now that I can perform more tasks, pay me more.”
This was the statement that an HR manager was struggling with recently at a company that is in the midst of introducing cross-training for multi-skilled operators as part of their lean manufacturing program. This challenge is not uncommon. There are two sides to every issue. Which side do you fall on?
From the worker’s point of view, it seems that they are doing more work. In actual fact, sometimes “slack” time is now being filled by working upstream or downstream in the process as operations are moved together to form cells and cycle times are balanced to takt time. It is not difficult to understand that the worker feels busier as they are producing more per unit of time. They are accomplishing more, so they want to be paid more. After all, the company is getting something more, so why shouldn’t the worker?
From the company’s point of view, the worker is paid for time, whether they do the same task for 8 hours or do 80 tasks in 8 hours, whether they are idle some, none or all of that time. In fact, since the worker in the example had been paid to spend some of their time idle, we can say it is only fair that work is rebalanced and they are able to put in a full day’s work. The productivity of the worker improves, and changing the process to improve productivity is just one of the responsibilities of management. We could say that in the past both management and the worker had “idle” or ineffective use of their time.
From the point of view of the customer, this is a silly debate. In most cases the customers pay for results, a service or a product, and not necessarily for the time spent. The market sets the price and a company must deliver high quality on-time at a low cost to persist profitably as an enterprise. Cross-training is simply one way to insure that this happens. The customers may appreciate the increased flexibility of the company and its cross-trained workforce, but they seldom will pay more for this.
So there are benefits to the customer and the company, but what about the worker? We can say that cross-training is in fact an example of people being paid to develop their skills. Job skills, or what you learn how to do at work, is a portable personal asset. It benefits the individual worker to know more skills, be cross-trained and able to perform more tasks because they are more desirable to the current and future employer. In lean companies cross training is a prerequisite to advancement to supervisory and leadership positions, as the team leaders, group leaders and even area managers are responsible for training, filling in for absent workers and being intimately familiar with the processes they manage and possible problems within them.
If we are able to think long-term investment in people through cross-training, the investment will pay off for everyone. Cross-training creates a win-win-win situation and is the obligation of every employer to promote this. The employee, the company and the customer all win. Each invest and gain from their investment at different points in time and to different degrees. Should cross-trained workers be paid more? What do you think?

  1. Karan

    March 12, 2009 - 11:47 pm

    This is the case with almost every organization.Cross-trained workers should be paid more because in the long run it benefits the company.

  2. David Moles

    March 13, 2009 - 4:10 am

    Would the answer change if workers were salaried?

  3. Panu Kinnari

    March 13, 2009 - 4:52 am

    In our company we pay slightly more to crosstrained people, but only if they also work in areas they are trained to work at. So increased pay forever after training is not automatic, people need to keep their skills up to date by working at different stations.
    Not all workers want to work in different stations. So I think slight compensation is good encouragement to those that are willing.

  4. Jon Miller

    March 13, 2009 - 3:18 pm

    Thanks for the comments. And good question, Dave. I think the logic would be the same for salaried workers – the more skill they had the more effective they should be.

  5. David McGan

    March 14, 2009 - 6:16 am

    Companies hire and pay workers for the value they provide. If in cross training they can provide more value, then it would be logical that the company would pay more for that increased value.

  6. Brian

    March 16, 2009 - 1:55 pm

    This is a great post I agree with David McGan. Cross trained people are more valuable to the organization so they should be compensated based upon their value to the organization.

  7. Paul McDaniel

    March 17, 2009 - 5:22 am

    Incentive compensation or profit sharing is the way to compensate the cross trained employee, be they hourly or salaried. As the output of lean, the company should become more efficient increasing output per headcount or product mix including handling new product introduction with smaller increases in staffing. So profits are going up, COGS going down, find the measure to base the reward on. Hopefully the lean program has already educated the staff that simply wishing for more output without changing the game doesn’t bring sustainable results. The company is giving the staff thepower to control their own compensation through profit sharing. If continual improvement and efficiency gains are not maintained, everyone’s compensation is affected.

  8. Scott

    March 17, 2009 - 8:42 am

    The commitment that the business needs to make to the team that no one will loose their job due to productivity, i.e. cross-training. The goal is to ensure the long-term tenure of the company and any reasonable business should reward their team if the results help the bottom line, which includes no take a ways. Reward is also keeping the company viable by enhancing your skills so that the company can also survive. Was it my expectations when I continued to get additional education and skill sets that I would automatically get more money, no but my opportunities grew to get a higher postion and more compensation. It is not always a give and get situation.

  9. John Santomer

    April 4, 2009 - 9:20 am

    I believe if the company has a clear vision and “Hoshin” is implemented; the goals set forth by each employee will surely be aligned with the company’s over-all targets. Basing the performance evaluation of an employee on these terms, it is increasingly probable that however small his contributions and achievements from the previous period were complementing on the
    goals and tagets set by the company at a higher level. Cross training and more tasks given to the employee would be part of his career path and higher responsibilites being called for as a result of “evolving” in the post. Cross training could also be given as a requirement for the next level in his career path. With all these incorporated in the employees’ duties, responsibilities and performanace mertices and career path – everyone can avoid the chaos of giving in to demands of a raise because of cross training and increasing dis-content due to additional tasks.

  10. Robbie W

    April 24, 2009 - 12:10 pm

    Salaried vs hourly?
    If I’m being paid hourly to run a crane in a non union steel shop and they ask me to perform the duties of a graphic artist, I expect to get paid for the services I’m rendering, period.
    If the same company ordered staples and paid 1 cent per staple, do they expect to get the stapler for 1 cent? Seems ridiculous to think so. If both jobs / duties pay the same amount, then i would say the employee does not deserve any more compensation. Any corp. that thinks differentlyprolly has a sick profit margin and alot of unhappy employees.

  11. Robert White

    July 30, 2009 - 6:04 pm

    I come from a facility that has just recently laid off 98% of it’s work force. It was a non-union plant. All the equipment has been moved out of the plant to Mexico and China. Our plant along with it’s sister plant were closed simultaneously laying off over 500 workers both hourly and salaried. There are only 6 support people left, I being one of them. Employment time remaining for the rest of us is likely short. My new responsibilities involve going to the new locations and training other folks to do my job. Most people from the two plants would have gladly taken pay cuts (some said up to 20%) and cross trained in new areas if the plants could have remained open. Our plant was already operating in a very lean manner. Over the past 8 to 10 years we had been through countless Lean Manufacturing events to reduce wasted time, space, labor, scrap and inventory. We made a lot of improvements but they just weren’t enough.
    I believe the attitude of more pay for learning new jobs is one of the major contributions to the downfall of our current manufacturing society. Time on the job should be spent working, regardless of the work to be done. Hiring policies should have reflected that attitude many years ago. Anyone who is able to keep a job in the present market should be counting their blessings rather than expecting more compensation. We are working against cultures that contain people who are thirsty for work. America has been given much over the past century and it seems like for a lot of folks it’s still not enough.
    There’s a great balancing act taking place around the globe that will bring other countries up to speed and it’s going to cost more American jobs if the thought process of expecting more money for simply staying busy does not change. This country was built by people who took ownership in their jobs and wanted security to raise their families. Today the attitude has changed and most people are standing around with their hands held out every time they think they’ve done something special. People need to wake up!!!

  12. patricia

    March 17, 2014 - 8:08 pm

    I believe that once you are crossed trained, you are more valuable to your employer than the existing employee,because you can be thrown into different departments, which means you are of more benefit to the company.even your department managers can not do that many departments.so we should be paid more ,because we do more in a sense.but the older employee gets paid twice as much to only do one department.how can you justify this….they may have been there much longer, but on average , we do way more, at any given time or place…..we need to be paid , and be appreciated for all our hard work…..

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