Piece rate is defined as work paid according to the number of units produced (e.g. the number of T-shirts produced) instead of being paid on the basis of time spent on the job.
Source: ILO.

"Workers whose pay is jointly determined by hourly pay and a piece rate (described as partial piece rate pay) are more likely to report reduced emotional and physical health compared to workers paid by the hour. Typically in these systems, workers receive the hourly base salary, which is often very low, and the incentive pay, based on the output, is obtained only if a certain output threshold is reached...suggesting that uncertainty or unpredictability in how payments are determined may be the driving factor of these detrimental effects."
Source: Better Work Programme.