Employees at Xeta Inc are divided into teams and each team is then assigned work. However, the management often finds it difficult to measure the level of effort each worker provides as the output is generated by the team as a whole

What can the management do to motivate workers to refrain from shirking?

Employees often shirk from their responsibilities when they cannot be individually held accountable for their behavior. This is the case in Xeta Inc. Such behavior is known as moral hazard. Moral hazard occurs in the labor market when employees make decisions or take actions based on their private information that is unavailable to the employers.
However, if the company provides efficiency wages to its employees, they are likely to exert more effort. Efficiency wages are wages above the lowest pay that workers would accept that employers use to increase workers' motivation and productivity.