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I'm going to hire a new tech soon. I've been through the wringer with employees. We're a smaller shop and at times struggle with organization. We're currently expanding and the work demand has been so high for over 3 years now we've got to move forward.

 

In the past we've paid hourly - bit us in the butt with productivity. We're too nice. These pay ranges were $10.00-$15.00 per hour.

We've paid base of $400 + book starting at $15.00 and moving to $20.00 paid anything over the $400.00

We've tried team book @ $15.00 - $20.00.

 

Either one or the other is always unhappy. This time I plan to better implement tech work sheets, and use these to help keep the employee better versed on their time.

Any suggestions on a pay plan that will satisfy employees and encourage productivity? We're at $65 hourly - and will be going up soon.

 

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Hourly doesn't provide any performance incentive. I don't think we have expended as much time and effort on any other subject. Working with our coach, we developed pay matrices for techs and SAs that enable us to meet our margin goals and reward them for performance. It's one off those things that illustrates that you can't be an expert on every facet of shop management and you need to get expert help.

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I don't have any real world examples to give you, especially not that will apply to your situation however:

I've read (and common sense would dictate) that one of the better pay plans seems to be

Hourly base (living wage or close to it) + large team bonus + small personal bonus

 

This gives your employees stability through bad times, incentive to work as a team (very important), and also incentive to better themselves.

The team bonus can be based off productivity, hours billed, margins etc, while the personal bonus could be based on getting training, personal efficiency, etc.

Then you can make the personal bonus contingent on having zero comebacks, and a 90+% customer satisfaction rating.

 

Glad to see you're raising your rates as well, not sure how people live off $10-15/hour being a primary breadwinner.

Edited by bstewart
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My response is going to start off like a property management seminar. I have some residential rentals and the absolute key to being successful in SFH (single family home) rentals is to have the right tenant. The right tenant pays on time, doesn't worry you, keeps the yard and house in excellent order, and stays with you for many years. I am very successful because I have the right tenants.

 

Success in a shop is similar in that you need the right employees. All of you know that. When I advertise for a tech, I let them know that I want someone who is hungry, who will bust his butt, who will keep the shop clean, who wants long term employment, will be a willing team member, and who is ready for a very busy, fast-paced, take no prisoners environment. Most of these kind of techs have a job and are not looking. But I'm like the Marines. I only need a few good men!!

 

I pay my guys three ways. Hourly, percentage, and spiffs.They make a good hourly check every Friday, and the first Friday of the month they get a percentage of their labor for the previous month's volume. My goal is for each tech's monthly bonus to be enough for his rent or mortgage payment. They work hard for it and really look forward to it. Every Monday they get paid spiff money for the previous week. These spiffs are paid on all flushes, fuel services, shocks, struts, air filters, cabin filters, and wipers.

 

This is what works for me so I wanted to share.

 

Hi-Gear

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I pay my guys per hour billed or a minimum whichever is greater. Their hourly flat rate per hour billed is $34/ hour. Their minimum is 60% of that which is $20.40 per hour. They work 44 hours a week. The flip from hourly to the flat rate works out to be 27.6 hours billed. If they bill over that, they get the flat rate amount. If they bill under that they get the hourly rate. So their minimum is $938.40 no matter what.

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I pay my guys per hour billed or a minimum whichever is greater. Their hourly flat rate per hour billed is $34/ hour. Their minimum is 60% of that which is $20.40 per hour. They work 44 hours a week. The flip from hourly to the flat rate works out to be 27.6 hours billed. If they bill over that, they get the flat rate amount. If they bill under that they get the hourly rate. So their minimum is $938.40 no matter what.

where do I fill out the application?!

These are all great ideas, my problem (maybe more of a personal worry) is I can't afford for them not to be productive. We're small. $550+ is a big chunk a week if they can't complete even $550.00 worth of work a week. We're really working hard on implementation of systems that help them suceed. The jump is just a bit intimidating.

 

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A very important facet of this is that your pay plan should insure that you are paying your techs overtime at the appropriate rate. If you get caught in a wage/hour dispute, the burden is on you to show that you met the overtime requirement. A good pay matrix will take care of this automatically.

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A very important facet of this is that your pay plan should insure that you are paying your techs overtime at the appropriate rate. If you get caught in a wage/hour dispute, the burden is on you to show that you met the overtime requirement. A good pay matrix will take care of this automatically.

We only work a 35 hour week, we take an hour for lunch and we're closed on weekends, so luckily we shouldn't have to worry about overtime!

 

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We used to pay per hour billed only, but found out that that plan is not legal in CA if we require them to do other things, like cleaning the shop.

 

Then we moved to base pay + bonus after certain amount of billed hours were met. Better, but a headache to keep track of.

 

Currently we pay hourly starting at $25+ for full-time. Our shop rate is $120/hr. But we run a little differently then some shops so this pay method works for us. Our techs clean, some of them write work orders and talk to customers. We are open on weekdays only (9am-6pm) and they get paid OT for anything over. It has been pretty smooth so far.

 

Every shop is different so you have to just find one that meets your shop's needs. Do you have techs that are just doing this to pay the bills? Do you have techs that are passionate and want a career out of this? For some people, hourly pay doesnt provide incentives to work their best. But have to also remember not everyone is motivated by money. You can pay someone well but if your shop is not a great environment to work in, that can also bring down performance. So there's a lot more to look at in terms of incentives and efficiency. Sorry if that doesnt help much!

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  • 3 months later...

It should be a win/win for both employees and business. We found the best way to do this is through billed hours. I which is really where the money comes from. So say techs get a base 17/hour and when they reach 35 billed hours we scrap the 17/hour and give them percentage of total labor sales from 20-30% of gross labor sales. Depending on the hours tech produces. This way techs have a good pay if shop is slow but does not hurt the shop. Basically pay can be from 17/hr all the way to 40/hr but it all depends on productivity on labor. Techs work hard to reach it and does not have to be in worry if shop is slow.

 

Oh advisors must have incentives to otherwise It wont work. You can have the best techs and pay plan but if advisor does not have incentive to do his best to educate, sell and provide excellent customer service then it wont work either.

 

Oh btw must have good marketing. Advisor cant do its job if phone is not ringing.

 

Sorry i think i went off topic. 😉

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This is good info. I only been in business for 3 months 2 Bay shop one tech and my self. I help the tech when I can other than that I run the shop as a servc advisor etc..

I was thinking if I have someone do the srvc advisor and have them ona salary, what would be a decent performance plan to have?

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You are all full of s.it

You play a numbers game with your techs, but in the end it is all about you getting paid.

Than you cry like little girls screaming why cant you get good techs.

Look, if this topic is all about screwing your workers than just say so, and I dont have a problem with that.

If you want to be fair and non of you do. But I will tell you.

Pay your techs 33% of labor. Period.

Work comes in , everybody makes money, no work no money for everybody. including you.

Plain and simple.

Can any of you handle that???

I doubt , and dont tell me about your expenses, Do you care about your techs expenses?

By the way , keep your bull sh1t comments to your self.

If you cant pay 33% it is no body's fault but yours.

 

Merry xmas you all little girls.

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Very much so.

Tell me I am not telling the truth.

I am getting pretty tired of shop owners crying about this and that , when at the end of the day it is all there fault.

Didn't any one ever told you guys that you get what you pay for??

Yeah I want to buy an S550 for a price of a Impala.

Not going to happen , no matter how much I piss and moan about it.

Many of you state , how generous you are by paying $15 per hour.

In Seattle over here it is minimum wage. I would rather go work in MC Donald's than being a grease monkey.

 

Merry Xmas girls.

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Very much so.

Tell me I am not telling the truth.

I am getting pretty tired of shop owners crying about this and that , when at the end of the day it is all there fault.

Didn't any one ever told you guys that you get what you pay for??

Yeah I want to buy an S550 for a price of a Impala.

Not going to happen , no matter how much I piss and moan about it.

Many of you state , how generous you are by paying $15 per hour.

In Seattle over here it is minimum wage. I would rather go work in MC Donald's than being a grease monkey.

 

Merry Xmas girls.

Let me guess you just finished watching the movie trolls. You've picked up some good pointers but your too obvious and not intelligent enough to pull it off. Go back under your bridge and leave trolling to the pros. Not some Wana be mechanic.
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I think the purpose of this forum is shop owners can learn from each other what works and what doesn't. I think its important to remember that different states have different laws and different markets. And shops and management styles differ from shop to shop. Which different owners take on different approach. We should take this forum as a learning tool to better this industry for its survival in the future.

 

I am a tech first before an owner and understand this. Trust me. This is not only a tech to owner problem but an industry wide issue. How do we expect to pay high when customers don't. When our profession is viewed simple as "grease monkeys" by people in and outside of this industry. how about change the perspective that this profession is respective and deserves quality pay and advancement. Problem is we as techs have advanced so much in technology and "costs goes up to stay current" but have not increase in professional value. I think this should be the first step. I guess the question is how do we do this collectively nationwide to advance this profession and industry as a whole?

 

Maybe this is more suited for another topic on this forum?

 

 

 

 

 

 

 

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You are all full of s.it

You play a numbers game with your techs, but in the end it is all about you getting paid.

Than you cry like little girls screaming why cant you get good techs.

Look, if this topic is all about screwing your workers than just say so, and I dont have a problem with that.

If you want to be fair and non of you do. But I will tell you.

Pay your techs 33% of labor. Period.

Work comes in , everybody makes money, no work no money for everybody. including you.

Plain and simple.

Can any of you handle that???

I doubt , and dont tell me about your expenses, Do you care about your techs expenses?

By the way , keep your bull sh1t comments to your self.

If you cant pay 33% it is no body's fault but yours.

 

Merry xmas you all little girls.

 

 

Very much so.

Tell me I am not telling the truth.

I am getting pretty tired of shop owners crying about this and that , when at the end of the day it is all there fault.

Didn't any one ever told you guys that you get what you pay for??

Yeah I want to buy an S550 for a price of a Impala.

Not going to happen , no matter how much I piss and moan about it.

Many of you state , how generous you are by paying $15 per hour.

In Seattle over here it is minimum wage. I would rather go work in MC Donald's than being a grease monkey.

 

Merry Xmas girls.

 

 

You have an excellent point of view.

 

 

Where as NCAUTOSHOP needs to get a new set of pantys.

 

 

 

_2080, please keep it professional. Thank you.

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I think the purpose of this forum is shop owners can learn from each other what works and what doesn't. I think its important to remember that different states have different laws and different markets. And shops and management styles differ from shop to shop. Which different owners take on different approach. We should take this forum as a learning tool to better this industry for its survival in the future.

 

I am a tech first before an owner and understand this. Trust me. This is not only a tech to owner problem but an industry wide issue. How do we expect to pay high when customers don't. When our profession is viewed simple as "grease monkeys" by people in and outside of this industry. how about change the perspective that this profession is respective and deserves quality pay and advancement. Problem is we as techs have advanced so much in technology and "costs goes up to stay current" but have not increase in professional value. I think this should be the first step. I guess the question is how do we do this collectively nationwide to advance this profession and industry as a whole?

 

Maybe this is more suited for another topic on this forum?

 

 

 

 

 

 

 

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Just to be clear, I completely agree. Don't let the other clatter disrupt your comment. I'd love to pay our techs more (they currently make more than I do, but we're a small shop. There's only 3 of us!)

We also need to drive our employees in a direction that they take responsibility for the profitibility and production of the shop. They need to reap the benifits, I agree. But it's not always easy finding those good employees capable of doing that!

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Just to be clear, I completely agree. Don't let the other clatter disrupt your comment. I'd love to pay our techs more (they currently make more than I do, but we're a small shop. There's only 3 of us!)

We also need to drive our employees in a direction that they take responsibility for the profitibility and production of the shop. They need to reap the benifits, I agree. But it's not always easy finding those good employees capable of doing that!

Thanks! Yes of course. Great that your doing this for your techs!

 

Yes this clatter can make this thread unreliable. Lets try to keep it about pay plan types. ✌️

 

 

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Oh wow. Didn't expect to see those type of comments on this type of forum. Terrible attitude. I'm pretty sure if anyone here was just all about getting paid and trying to rip their employees off, they wouldn't be on a professional and informative forum like this. If you really wanted to make tons of money for yourself and not pay people what they deserve, we all know how to do that (which is entirely illegal) and it definitely doesnt involve spending time on a forum like this learning how to do things the right/legitimate way, and learning other business models, pay structures, etc from other professionals here.

 

Not all business owners intend to "screw" their workers, and not all techs are great techs. The issue with pay in this industry is way deeper than that, as already mentioned by others in this thread/forum. We're all here to learn and I doubt you have things 100% figured out if you think things are that "plain and simple" in running a business. Have some respect.

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  • 1 month later...

We used to pay per hour billed only, but found out that that plan is not legal in CA if we require them to do other things, like cleaning the shop.

 

Then we moved to base pay + bonus after certain amount of billed hours were met. Better, but a headache to keep track of.

 

Currently we pay hourly starting at $25+ for full-time. Our shop rate is $120/hr. But we run a little differently then some shops so this pay method works for us. Our techs clean, some of them write work orders and talk to customers. We are open on weekdays only (9am-6pm) and they get paid OT for anything over. It has been pretty smooth so far.

 

Every shop is different so you have to just find one that meets your shop's needs. Do you have techs that are just doing this to pay the bills? Do you have techs that are passionate and want a career out of this? For some people, hourly pay doesnt provide incentives to work their best. But have to also remember not everyone is motivated by money. You can pay someone well but if your shop is not a great environment to work in, that can also bring down performance. So there's a lot more to look at in terms of incentives and efficiency. Sorry if that doesnt help much!

 

Do you ever have any issues with keeping technicians busy when there are no cars to work on? What do you have them do and how do you keep track of what has been done? We currently pay hourly as well and it sometimes it seems difficult to get technicians who are used to flat rate to understand that expectations are different when you are paid hourly......

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Do you ever have any issues with keeping technicians busy when there are no cars to work on? What do you have them do and how do you keep track of what has been done? We currently pay hourly as well and it sometimes it seems difficult to get technicians who are used to flat rate to understand that expectations are different when you are paid hourly......

 

 

This is the mix I have used in over 20 years.

 

1. Base salary, plus production bonus.

 

2. When retail customer flow is slow, and fleet accounts are up to date and there is shop slack. I make sure all items that need attention around the shop are fixed.

 

3. I keep a set of vehicles that need to be serviced before they are placed for sale. For example, if I have bought a 2006 Camry that is going to be sold, I have it inspected, prepared, repair/service, certified, set for sale.

 

This cycle has not failed me yet.

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This is the mix I have used in over 20 years.

 

1. Base salary, plus production bonus.

 

2. When retail customer flow is slow, and fleet accounts are up to date and there is shop slack. I make sure all items that need attention around the shop are fixed.

 

3. I keep a set of vehicles that need to be serviced before they are placed for sale. For example, if I have bought a 2006 Camry that is going to be sold, I have it inspected, prepared, repair/service, certified, set for sale.

 

This cycle has not failed me yet.

 

For your mix, is this correct: Base Salary = $800 + Production Bonus - How is this calculated? Is it based on if the technician turns a certain number of hours or is it based on efficiency on the hours that the turned? Do you add the base salary with the production bonus?

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  • 2 weeks later...

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  • Have you checked out Joe's Latest Blog?

    • By Joe Marconi in Joe's Blog
         4
      Typically, when productivity suffers, the shop owner or manager directs their attention to the technicians. Are they doing all they can do to maintain high billable hours? Are they as efficient as they can be?  Is there time being wasted throughout the technician’s day? 
      All these reasons factor into production problems, but before we point fingers at the technicians, let’s consider a few other factors.
      Are estimates being written properly? Are labor testing and inspections being billed out correctly? Are you charging enough for testing and inspecting, especially for highly specialized electrical, on-board computer issues, and other complex drivability work?  Is there a clear workflow process everyone follows that details every step from the write-up to vehicle delivery? Do you track comebacks, and is that affecting production?  Is the shop layout not conducive to high production? For example, is it unorganized, where shop tools, technical information, and equipment are not easily accessible to every technician?  Are you charging the correct labor rate and allowing for variables such as rust, vehicle age, and the fact that most labor guides are wrong? Also, is there effective communication between the tech and the service advisor to ensure that extra labor time is accounted for and billed to the customer? These are a few of the top reasons for low productivity problems. There are others, but the main point is to look at the entire operation. Productivity is a team effort.  Blaming the techs or other staff members does not get to the root cause in most cases.
      Maintaining adequate production levels is the responsibility of management to create the processes that will lead to high production while holding everyone accountable. 
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