Causes For Labour Efficiency Variance
The causes giving rise to direct labour efficiency variance as follows:
- Lack of proper supervision or stricter supervision that specified.
- Poor working conditions
- Delay due to, waiting for materials tools, instructions etc. if not treated as idle time.
- Defective machine tools, and other equipments.
- Machine break down if not booked to idle time.
- Work on new machines requiring less tike then provided for as long as the standard is not revised.
- Basic inefficiency of workers due to low morale, insufficient training, faulty instructions, incorrect scheduling of jobs etc.
- Use of non standard material requiring more or less operation wages.
- Carrying our operations not provided for and booking them as direct wages.
- In correct standards
- Wrong selection of workers, e.g. no employing the right type of man for doing the job.
- Increase in labour turnover.
- Incorrect recording of performances, i.e. time and output.
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