Service Work Pay Opinions wanted!

[petersonra]

Suppose that the job is an hour and a half from the shop; what's more, it's on a route that runs right by the tech's house? The "standard" way requires that you burn 3 hours per day in travel, and the tech gets paid for it and there's 5 hours of productive time possible. Let him keep the truck, make sure he has what he needs, tell him he has to be on the job site by 0700 and the travel time in is unpaid. Let him quit at 1430 ( with 15 minutes to clean up and 15 for paperwork) and he's home by 1600, just like he was punching in back in at the office. In this case, you have 7 hours of productive work time possible. It seems like a doable compromise.

It seems to me you are screwing the guy over doing this. If someone pulled this on me I would be pissed about it.

It seems over elaborate to me as well.

Just be fair with the guy and pay him for the time he is spending on your business. If that makes the job too expensive, turn it down.

 

[K8MHZ]

We are a very small company and I have 1 Service Tech whom is very good at what he does, loves to be on his own, great with customers, etc. The challenge I am having is being able to produce what I believe we should be able to with our service work. For example he is currently paid hourly and what seems to be happening is he will start his hours when he leaves his house at 6:45, he will come by the shop and grab some small materials (screws, fittings, etc.), talk for a little while to me and the other guys about to head out to other projects...but his first appointment wont be until 8:30 so theres already almost two hours of unproductive labor. Also, there may be 1-2 Hour gap between appointments. An example would be a few days ago he turned in 7 hrs (from when he left his house to the time he pulled in his drive way) and there was only 3.5 Billable Hours. I am looking for possibly a commission based rate...something that would be an incentive to stock the vehicle, plan for projects etc. on his time so that he can produce as much as possoble throughout the day, in turn actually earning more for himself and the company.
This is the break down of the example.
Start 7AM
First appt start time 9AM End time: 11:15 = 2.25 Hrs
Dr's Appt from 1-2PM
Service call from 2:30-3 (1 Hour billable)
End the Day at 3PM
Total Pay Roll = 8 Hours - 1hr Dr Appt = 7hrs
Total Billable = 3.25

How is something like this typically handled as far as pay Roll Hours vs. Billable?? I understand every place can be different and all that...what have some of you experienced or currently experiencing that is or is not working for the employee as well as the company?

I realize you wanting to come up with something to 'earn more for himself and the company', because you will make more money, but the fact of the matter is that's not likely to happen.

If you want to be fair, then pay fair. It's not all that rough.

No pay for portal to portal, that is from home to work and from work to home, so long as both spots remain the same. IOW, work starts at the shop, not at a customers site, or the supply house. That means no stopping on the way to the shop to get parts or look at a job.

Tech gets paid from his clock in times.

All work done for the company gets paid for because that will be done 'on the clock'.

If you want to provide an incentive, make the 'on the clock' hours a base rate. Add a few bucks for every hour billed. An example would be 25 bucks an hour plus 5 dollars an hour for every hour billed to the customer.

One thing I can assure you is that if you cut your employees pay, not matter how elegant or creative the means appears, it will cause bad blood between you and the employee.

I have been there. Many years ago I worked at a small business that made eyeglasses. Their bonus / breakage plan was set up and worked well, then they got real busy and my pay actually got less the busier the department got. I was making 2 - 3 times the amount of lenses, but working for about 80 percent of my previous pay. The FIRST thing on my mind when I got a short check was an exit strategy. The exit came shortly after.

 

[K8MHZ]

The OP's task would be much easier if he was dealing with a screw up instead of a good employee that the customers like. If the tech quits, some of the customers may just 'follow' him to his next employer.

 

[jahilliard]

Geez!!! In no way did ever say or ensinuate I RESENTED my employee. In fact it's drastically opposite. If that were the case is be a fool for having the employee and wouldn't be in this thread. And we absolutely put it all out there in fact me and him have discussed the feed back on this site and this particular thread. It's difficult, NOT IMPOSSIBLE, as an employer and my own experiences with work that being paid for every portion of every task be compensated like refueling ahead of time or reorganizing and cleaning your truck. Again, I simply see an opportunity for improvement and would like some insight. In my case with this employee I see an opportunity to achieve that top 2% that most never ever reach! And just for sake of discussion...allowing an employee to take a vehicle home is most times a perk. Driving your vehicle to the shop, and back to the shop after is a pain and takes up personal time of which is definitely not compensated. I'm not saying it's a heavy perk BUT it's a perk IMO.

 

[jahilliard]

The responses say quite a bit about the general attitude of just about every single person anywhere. The immediate response is...this must be negative and a problem etc. I simply asked how to improve and minimize unproductive labor. And it went into resenting my employee and asking for something for free and on and on. It went from asking for advice and experience on how I can offer more...to taking advantage and resentment. I genuinely have a desire to be able to pay my employees 25-30% more than someone of equal skill that works somewhere else...and my employees are well aware of that and we work on figuring that out often. I imagine most of you don't EVER do that...there's no doubt most of you NEVER make any extra effort to improve your employees lives more than figuring what your employees profit prediction is. This is not where I intended the thread to go but now that we are here...Id like to hear all the extra effort made to improve the quality of life for your employees. Are you focused on lower pay and higher profits? Or is your focus truly on your employees and their families and the families you provide a service to? There MIGHT be one or two of you out there at best. If you believe you have your employees and their families and the families of the people you provide a service to, are truly part of why you do what you do I would genuinely love to hear about that kind of thing. What efforts are made for their benefit only? Maybe this thread can be turned into what I originally intended it to be...a way to effectively be most efficient for the benefit of everyone involved.

 

[jumper]

If it is company work-I get paid. Period IMO.

Taking the truck home-who benefits the most? I cut some of my commuter costs, but not time and effort if I have to fuel, oil change, load materiiels , etc on my time. For me- never was worth it. Could not use truck for any personal business so was basically a burden in the long run.

 

[petersonra]

Geez!!! In no way did ever say or ensinuate I RESENTED my employee. In fact it's drastically opposite. If that were the case is be a fool for having the employee and wouldn't be in this thread. And we absolutely put it all out there in fact me and him have discussed the feed back on this site and this particular thread. It's difficult, NOT IMPOSSIBLE, as an employer and my own experiences with work that being paid for every portion of every task be compensated like refueling ahead of time or reorganizing and cleaning your truck. Again, I simply see an opportunity for improvement and would like some insight. In my case with this employee I see an opportunity to achieve that top 2% that most never ever reach! And just for sake of discussion...allowing an employee to take a vehicle home is most times a perk. Driving your vehicle to the shop, and back to the shop after is a pain and takes up personal time of which is definitely not compensated. I'm not saying it's a heavy perk BUT it's a perk IMO.

I don't see it as all that much of a perk. You are not letting him drive the vehicle home to be a nice guy. You are doing it because you are too cheap to pay him to be on 24 hour call. A lot of places compensate their employees who are on call. if they get a call it is a minimum 4 hours for instance. No call that night you get 2 hours.

 

[gadfly56]

It seems to me you are screwing the guy over doing this. If someone pulled this on me I would be pissed about it.

It seems over elaborate to me as well.

Just be fair with the guy and pay him for the time he is spending on your business. If that makes the job too expensive, turn it down.

Define "fair" so it's on the table. In the case I suggested, what do you think should be done?

 

[Strathead]

The responses say quite a bit about the general attitude of just about every single person anywhere. The immediate response is...this must be negative and a problem etc. I simply asked how to improve and minimize unproductive labor. And it went into resenting my employee and asking for something for free and on and on. It went from asking for advice and experience on how I can offer more...to taking advantage and resentment. I genuinely have a desire to be able to pay my employees 25-30% more than someone of equal skill that works somewhere else...and my employees are well aware of that and we work on figuring that out often. I imagine most of you don't EVER do that...there's no doubt most of you NEVER make any extra effort to improve your employees lives more than figuring what your employees profit prediction is. This is not where I intended the thread to go but now that we are here...Id like to hear all the extra effort made to improve the quality of life for your employees. Are you focused on lower pay and higher profits? Or is your focus truly on your employees and their families and the families you provide a service to? There MIGHT be one or two of you out there at best. If you believe you have your employees and their families and the families of the people you provide a service to, are truly part of why you do what you do I would genuinely love to hear about that kind of thing. What efforts are made for their benefit only? Maybe this thread can be turned into what I originally intended it to be...a way to effectively be most efficient for the benefit of everyone involved.

With all due respect and this is intended to be constructive criticism, reread what you originally wrote objectively. If you think it conveys what you are implying here then I would be very cautious when writing to customers, because it does not come across that way. Perhaps it is just the general knowledge that you CAN'T require your employee to do work related items without paying for it and that is EXACTLY what you are suggesting in your narrative. Whether you work out other compensation that rewards him beyond his normal pay or not, that is not the way you can legally do it. So the immediate reaction when reading it is that you are trying to cut corners. On a side note. I am an employee. And I say shame on my employer if "profit prediction" as you put it isn't on the top of the list of importance. Without profit there is no company. As others have tried to suggest to you, work backwards. Figure out the minimum profit you have to make. Then figure out how much time with no charge seems reasonable to you. Then as a GOOD boss, sit down with your great employee and set some guidelines. Be careful, your guidelines have to be applicable to the second truck you decide to add next year or you are right back in trouble with the labor board. After you have all of that information, you are able to figure out what you have to charge per productive hour. It makes no sense to do it any other way. From there, you can offer bonuses for more billable hours, for example.

 

[petersonra]

Define "fair" so it's on the table. In the case I suggested, what do you think should be done?

I can't define exactly what a fair practice is because it is such a subjective term.

First and foremost, it would need to abide by the various labor laws, and other rules and regulations that might apply, such as union contractual requirements. That means time spent gassing up the vehicle, washing it, stocking it, and filling out reports are paid for. It also means you cannot claim to pay the guy a "salary" to get around this requirement (as was suggested in one post), since electricians just are not exempt employees, unless they are also a principal.

Beyond that, it should be something both the employer and the employee accept willingly. Maybe the guy is willing to be on call 24/7 in exchange for a take home vehicle. I wouldn't but maybe some people are. To me it would be almost a nuisance since virtually all take home vehicles end up having restrictions that make them almost more trouble than they are worth. For instance, it is not unusual for employers to restrict employees from drinking while driving their vehicles. that means you might not be able to stop off for supper on your way home and have a glass of wine with your meal. Some employers have restrictions that prevent one from even stopping at a grocery store. If I can't make a stop at WalMart on my way home and have to go home first and get a different vehicle, what good is that to me. I am not opposed to these restrictions, but they limit the utility of the take home vehicle to the point where it sometimes is not worth anything to an employee.

The OP might argue that he has no such restrictions, but chances are he will at some point because the company insurer will find out about the take home vehicle and require such a policy.

 

[JFletcher]

ja hilliard, both of my replies were written with the intent of both you and your employee reading them.

"I simply asked how to improve and minimize unproductive labor."

Which I provided some possible solutions.

As an employee, inefficiency bothers me because a) I spend more time 'working' doing nothing=longer day for same tasks and b) I know my earnings potential is being limited by something that is *usually* an easy fix. As a former employer, it bothered me more then, and as a subcontractor, it made me more than a little crazy.

If you are looking for specifics, here's one; keep a clipboard and paper at the back of the truck. Order and replenish stock when you are low, not slam out.

As an employee, I'd dislike going to the shop every morning for trivial supplies and idle chit-chat; to me, that is a waste of time, regardless of paid or not.

Heck, I disliked having to physically get inside the boss's Sprinter for red wire nuts, crimp sleeves, nm staples, single gang boxes, receptacles, switches and coverplates (commonly used parts for me)-if they were near the door, it would literally save me a step. Whats a step? x20/day, it means I would be home 10 min earlier. Over the course of a month, that's 3 completely wasted hours, 3 service calls I couldnt schedule, a Friday I couldnt take off-however you look at it, those little things do make a difference.

People say "dont sweat the small stuff". They also say "the devil is in the detail".

 

[jahilliard]

Of course, employee, you have to figure profit. That's silly to even say. Let's take an example from my past in relation to..you get paid for the value you bring to the market. When I was brand new my lead guys would show upmost in time on site. Then they would get their tools out and begin looking at the plans to determine the days tasks. Then their supervisor would walk up and say...maybe take the plans home tonight, lay out tomorrow and get your guys going immediately? Of course after their supervisor walks away its explained how he doesn't get paid enough to take the plans home...if I got paid more I'd do that....hey stove, give me some heat and I'll throw some wood in there!) again, you get paid for the value you bring NOT your time. If you believe that, you will in fact stay right alongside all the others that believe that. Any of my employees are more than welcome to leave the vehicles at the shop, and of course they choose not to, why??, because it benefits them! And intimately costs me Money. As far as 24hr service and me being too cheap for that...ain't none of my guys wanting anything to do with 24hr service!

 

[jahilliard]

Fletcher I believe we are on the same page...just looking for ways to benefit all! I have great guys and I want them to be banking!! And I'm asking for help on how to accomplish that!

 

[jahilliard]

LOL!!!!! Everyone's on their own time now...ain't got time to be wasting on a trade forum!!

 

[cowboyjwc]

They used to let us take the city trucks home as a benefit, then the IRS said that there is a cost to that benefit and wanted to tax the employees that took the trucks home.

No one takes the trucks home anymore. If we get an after hours call we just report to the yard and pick up our truck and then go to the call.

 

[qcroanoke]

They used to let us take the city trucks home as a benefit, then the IRS said that there is a cost to that benefit and wanted to tax the employees that took the trucks home.
No one takes the trucks home anymore. If we get an after hours call we just report to the yard and pick up our truck and then go to the call.

That is my understanding of it also. But I guess you don't have to tell the IRS you take it home.......

 

[petersonra]

That is my understanding of it also. But I guess you don't have to tell the IRS you take it home.......

The same reason few companies provide companies cars to executives any more. used to be it was a tax free benefit. These days the executives would have to pay tax on it.

However, if there is a business reason for taking the vehicle home, such as being on call, there is no tax penalty.

 

[gadfly56]

They used to let us take the city trucks home as a benefit, then the IRS said that there is a cost to that benefit and wanted to tax the employees that took the trucks home.

No one takes the trucks home anymore. If we get an after hours call we just report to the yard and pick up our truck and then go to the call.

I would be surprised if the city would allow any personal use of the truck. In that case, how is it a benefit? An ex-employer of mine tried to get me to take home my truck. So I quizzed him on circumstances of use, etc. Basically, if I wanted to stop off at QuickCheck on the way home to grab a soda, that was OK. Not so much a stop at Home Depot to pick up something for a weekend home project. And definitely not picking up a bunch of plywood on the weekend. The real advantage was all his; I could take an emergency call right from my house instead of taking 15 minutes to run into the shop to pick up the truck. I declined his "generous" offer!

 

[jahilliard]

I still believe the company vehicle can be beneficial to an employee more than the employer...most of the time. Let's use the last example...how often are you stopping to get materials for a home project? Probably not very often at all. How often are you stopping to get something at a Quick Stop...probably daily. Let's say you average 15 miles one way to your shop...that's 7500 miles a year at 50 weeks that isn't out on your personal vehicle. Call your insurance company and tell them you have just reduced your vehicle mileage by 7500 miles per year...if they don't reduce your premium...get a different insurance company! Personal fuel costs saved per year about $1300! Equivalent to about .60/hr increase in After tax income. In a lot of cases I've seen it allowed a family to only have to maintain one vehicle personally. And above all that...the employer accepts ALL liability for whatever happens in that vehicle...period! Seems generous to me....of course I am an employer currently and have a biased opinion.

 

[gadfly56]

I still believe the company vehicle can be beneficial to an employee more than the employer...most of the time. Let's use the last example...how often are you stopping to get materials for a home project? Probably not very often at all. How often are you stopping to get something at a Quick Stop...probably daily. Let's say you average 15 miles one way to your shop...that's 7500 miles a year at 50 weeks that isn't out on your personal vehicle. Call your insurance company and tell them you have just reduced your vehicle mileage by 7500 miles per year...if they don't reduce your premium...get a different insurance company! Personal fuel costs saved per year about $1300! Equivalent to about .60/hr increase in After tax income. In a lot of cases I've seen it allowed a family to only have to maintain one vehicle personally. And above all that...the employer accepts ALL liability for whatever happens in that vehicle...period! Seems generous to me....of course I am an employer currently and have a biased opinion.

Well, I suppose YMMV. It was only 4.3 miles to the shop, and as I said personal errands weren't going to be allowed. There is no way I could park on the street, so the truck would have to sit in my driveway. The driveway was single lane, so all the vehicles were stacked in a single row. Playing three car monte depending on who's going to work or getting the groceries would have just been a royal PITA. If there had been more swinging room in the parking department I might have considered it.