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FLAT RATE, SALARY, COMBO


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Is your $500 bonus monthly or weekly?   It equates to either $2.77/hr or $12.50/hr.  Guessing monthly.  50% Insurance guessing $700/employee, so $350 = $1.94/hr.  2 weeks vacation = $41*80 = $1.64/hr.   Matching 401K @ 6% match = 41*.06=2.46*5= $1.23/hr.  This all adds up to $7.58 (or $7-$8/hr) on top of their base pay.   

Staying with your top rate ($41 + $8) = $49 * 2000 = $98K.  (used 2000 hours as the 80 hour vacation is in the $8 already).

Someone told me a long time ago, that your employees will not understand / comprehend how much they are making, especially with intangibles.  He liked to write their hourly pay on their paychecks, so that they would SEE their actual pay rate.  My top earning GS Techs continually under guess their pay rate.   I have one leaving now that is taking a pay cut, but thinks he's getting a raise.  Now, if they offer him overtime, he will make more than here.  He randomly gets overtime, but we keep it to a minimum as best we can.    What I've noticed is that employees with little fiscal control, like to make their lack of money in their account my problem.  "My account is empty because your are not paying me enough."  Mind you, they are ordering food in via Uber Eats, buying expensive drinks from the Walgreens next door and have other expensive vices. 

Next, does this employee have insurance?  Does he contribute to his 401K?   Is the bonus regularly hit?  These are valued at $0 if he does not partake.   And they are valued at $0 if he doesn't understand.   I'm sure that you explained all of this to him.  It could be that the other shop has some perks too that cancel yours out.

Is he making a SALARY at the other place?   If so, his income is guaranteed.  He does not get penalized for picking up kids, etc.   Having certainty in one's income is high ranking in quality of life.   If flag, time will tell.

I have 1 tech making $1800/week, + $5/hr flag bonus ($45/hr + $5 = $50).   I have another making $35/hr + $10/flag hour and an apprentice making $20/hr + $6/hr.  Hourly guys are paid at 1.5X (of base+flag) if they work OT. And I don't have Insurance Matching, 401K or Vacation.  Next on my list to add is Insurance matching.    While I don't have a vacation benefit, I've randomly paid bonuses (of 1-5 days) in lieu of vacation/sick time or kept people on the payroll just to help them.    Have a manager/service writer out with a heart attack, and kept him on payroll for about 5 weeks without being here.   (He's still out, but now on leave.  I hope for him to return in 2-3 weeks.   Still a maybe).

I like your question.   It had me doing math and I see the costs of benefits that I'm not offering in black and white.   It's going to help me too!   

P.S.  Just before posting this, I added 50% matching on health insurance as a new benefit.   I just polled everybody and have a 3-4 that want to sign up.   Only 2 were willing to sign up with 0% matching, because they are young and their insurance rates are very low.   I want my techs to have insurance so that they stay healthy!    Thank you.

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We pay our techs hourly with overtime and a performance bonus on their flagged time when they hit a set time . We pay %70 of health insurance, payed dental insurance payed life insurance, payed uniforms, gloves 

6 holidays 1 week of vacation after the first year and 2 weeks after 3 years parts are at cost. Performance bonus is $2 per flagged hour at 35 hours,$4 at 40 hours, $6 at 45 hours and $8 at 50 hours and above. The SW is $15 per hour with overtime

and a percentage of sales that starts at %1.25 when we reach $15000 in sales for the week and escalates by %.25 at every increase of $2500. The % tops out at %2.50 and $30,000 of sales and above. All our equipment is 5 years old or newer with factory scanners and software. 

 

 

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  • Have you checked out Joe's Latest Blog?

         5 comments
      I recently spoke with a friend of mine who owns a large general repair shop in the Midwest. His father founded the business in 1975. He was telling me that although he’s busy, he’s also very frustrated. When I probed him more about his frustrations, he said that it’s hard to find qualified technicians. My friend employs four technicians and is looking to hire two more. I then asked him, “How long does a technician last working for you.” He looked puzzled and replied, “I never really thought about that, but I can tell that except for one tech, most technicians don’t last working for me longer than a few years.”
      Judging from personal experience as a shop owner and from what I know about the auto repair industry, I can tell you that other than a few exceptions, the turnover rate for technicians in our industry is too high. This makes me think, do we have a technician shortage or a retention problem? Have we done the best we can over the decades to provide great pay plans, benefits packages, great work environments, and the right culture to ensure that the techs we have stay with us?
      Finding and hiring qualified automotive technicians is not a new phenomenon. This problem has been around for as long as I can remember. While we do need to attract people to our industry and provide the necessary training and mentorship, we also need to focus on retention. Having a revolving door and needing to hire techs every few years or so costs your company money. Big money! And that revolving door may be a sign of an even bigger issue: poor leadership, and poor employee management skills.
      Here’s one more thing to consider, for the most part, technicians don’t leave one job to start a new career, they leave one shop as a technician to become a technician at another shop. The reasons why they leave can be debated, but there is one fact that we cannot deny, people don’t quit the company they work for, they usually leave because of the boss or manager they work for.
      Put yourselves in the shoes of your employees. Do you have a workplace that communicates, “We appreciate you and want you to stay!”
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