Work Allowance Calculation: What They Are and How They Affect Standard Time

Key Points:

• Work allowances are additional times incorporated into standard time to compensate for inevitable human and operational needs.
• There are four main types: personal needs allowances (5-7%), basic fatigue allowances (4%), variable fatigue allowances (based on conditions), and unavoidable delay allowances.
• Correct calculation of allowances ensures fair, sustainable, and realistic standard times for production planning.
• Specialized software can greatly facilitate the calculation and documentation of work allowances.

Introduction to Work Allowances: Work allowances are essential components of standard time that compensate for inevitable human and operational needs. They are not “arbitrary padding,” but scientifically justified additions to ensure standards are sustainable and realistic, considering factors such as fatigue, personal needs, and small unavoidable process interruptions.

Types of Allowances and Their Calculation: There are four main types: personal needs allowances (5-7% to cover physiological breaks), basic fatigue allowances (4% constant), variable fatigue allowances (based on factors such as physical effort, posture, and environmental conditions), and unavoidable delay allowances (determined through work sampling). The final calculation adds all these percentages and applies them to the basic time: ST = BT × (1 + % Total Allowance / 100).

Impact on Industrial Management: Accurate calculation of allowances improves production planning, product costing, worker acceptance, and identification of ergonomic improvement opportunities. Common errors include applying historical percentages without specific analysis or including avoidable delays that are management’s responsibility.

Detailed Note

I. Introduction to Work Allowances

Work allowances represent an additional amount of time that is incorporated into the Standard Time of a task, beyond the Basic Time (the time normalized to 100% pace). Their purpose is to compensate the worker for necessary or unavoidable factors that occur during the workday but are not part of the purely productive execution of the standard work method.

Adding allowances is not “inflating” time, but making it realistic and fair. They are indispensable for several key reasons:

1. Performance Sustainability: Humans are not machines. They need time to recover from the physical and mental fatigue inherent to work, as well as to attend to basic physiological needs.

2. Operational Realism: No process works perfectly without interruptions. There are small unavoidable delays (minor adjustments, quick consultations, etc.) that are part of day-to-day reality.

3. Fairness and Acceptance: A Standard Time that does not consider these needs and realities will be perceived as unfair and unrealistic by workers.

4. Accuracy of the Standard for Management: For Standard Time to be a useful tool in planning, costing, and evaluation, it must include all necessary time components.

II. Main Types of Work Allowances

Allowances are generally classified into several main categories:

1. Personal Needs Allowances

• Purpose: Cover the time necessary for the worker to attend to basic physiological needs during the workday (going to the bathroom, drinking water, etc.).
• Determination: Generally established as a fixed percentage between 5% and 7% of work time.

2. Fatigue Allowances

• Basic Fatigue: A constant percentage applied to almost all tasks (around 4% of Basic Time) to compensate for the energy expenditure inherent to being alive and working.
• Variable Fatigue: This is an additional percentage that directly depends on the intensity and duration of specific task factors that induce fatigue above the basic level. It considers:
  • Physical Effort: Lifting, pushing, pulling weights; use of muscular force.
  • Posture: Working constantly standing, stooping, stretching, in uncomfortable positions.
  • Movements: Very short and repetitive cycles, vibrations.
  • Environmental Conditions: Exposure to heat, cold, humidity, noise, poor lighting, dust, fumes.
  • Mental/Visual Stress: Need for high concentration, attention to fine details, complex decision-making under pressure.

3. Unavoidable Delays or Contingency Allowances

• Purpose: Cover small interruptions or delays that are inherent and normal to the work process, but occur irregularly (receiving brief instructions, waiting for a machine to complete a short automatic cycle, etc.).
• Determination: The most objective method is to conduct a Work Sampling study over a representative period.

4. Special Allowances

• Purpose: Account for activities necessary to perform the work, but that do not occur in each production cycle (machine cleaning, important tool changes, etc.).

III. How Allowance Percentages Are Determined and Calculated

Summarizing the most common determination methods:

• Personal Needs: Fixed percentage by policy/agreement (e.g., 5%).
• Basic Fatigue: Fixed percentage by policy/agreement (e.g., 4%).
• Variable Fatigue: Detailed task analysis + Points/Tables System (e.g., ILO).
• Unavoidable Delays: Work Sampling Study.

The Final Calculation of Standard Time:

Once the applicable allowance percentages for the task are determined, they are added to obtain the total allowance percentage. This total is applied to the Basic Time (BT) to calculate the Standard Time (ST):

1. % Total Allowance = % Personal Needs + % Basic Fatigue + % Variable Fatigue + % Unavoidable Delays + [% Special Allowances if applicable as %]
2. Standard Time (ST) = Basic Time (BT) × (1 + % Total Allowance / 100)

Example: If BT = 1.20 minutes, Personal Allow. = 5%, Basic Fatigue Allow. = 4%, Variable Fatigue Allow. = 8%, Delays Allow. = 3%. % Total Allowance = 5 + 4 + 8 + 3 = 20% ST = 1.20 * (1 + 20 / 100) = 1.20 * (1 + 0.20) = 1.20 * 1.20 = 1.44 minutes.

IV. Common Errors and Best Practices

Frequent Errors:

• Applying a “historical” or “plant average” allowance percentage to all tasks without analyzing their specific demands.
• Not justifying or documenting how the applied percentages were determined.
• Including in delay allowances delays that are avoidable or management’s responsibility.
• Double-counting time (e.g., including a wait as a measured element and also giving it a delay allowance).

Best Practices:

• Always analyze the specific task to determine variable fatigue factors and the probability of unavoidable delays.
• Use objective methods whenever possible (e.g., Work Sampling for delays).
• Base on recognized tables or systems (such as those from the ILO) for variable fatigue.
• Thoroughly document the justification for each applied allowance percentage.
• Establish and follow clear and consistent company policies on allowances.

V. Can Software Help in Allowance Calculation?

Good time study software can be a great help for calculating work allowances:

• Incorporation of Standards: They allow configuring company policies and/or incorporating standard tables.
• Guidance for the Analyst: Some systems can guide the analyst through the evaluation of variable fatigue factors.
• Automatic and Consistent Calculation: Once the factors are defined or the percentages selected, the software applies the calculations automatically.
• Integrated Documentation: They automatically record which allowances and with what percentages/justifications were applied to each study.

VI. Conclusion

The calculation of work allowances is a critical and non-trivial stage in the process of establishing Standard Times. These allowances are not a discretionary “cushion” of time, but essential components based on real physiological, psychological, and operational needs, which make the standard sustainable and achievable.

Understanding what work allowances are, the different types, and applying rigorous and justified methods for their determination is as important as measuring time accurately or correctly rating the pace. Only in this way will reliable standard times be achieved that truly reflect the time needed to perform a task under normal conditions.

Key References

• International Labour Organization (ILO). (1992). Introduction to Work Study. 4th Edition. Edited by George Kanawaty.
• Barnes, R.M. (1980). Motion and Time Study: Design and Measurement of Work. 7th Edition. Wiley.
• Niebel, B.W., & Freivalds, A. (2014). Methods, Standards, and Work Design. 13th Edition. McGraw-Hill.
• Kanawaty, G. (2006). Introduction to Work Study. International Labour Office.
• Meyers, F.E., & Stewart, J.R. (2002). Motion and Time Study for Lean Manufacturing. 3rd Edition. Prentice Hall.