Anyone doing commission based pay instead of hourly for your employees with their pressure washing? How do you pay and what formula do you use? How do you do your taxes quarterly or do you 10-99? I’m interested in this system…
Hey Jeremy, we pay out 30% to the crew, split unevenly based on experience. So if a guy is working solo, he’d get all 30%. If its two guys it might be 16-14, or 17-13, so on and so forth. We don’t 1099 anyone. You have to be really careful about treating employees as subcontractors, you can get in a LOT of trouble for that.
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Independent-Contractor-(Self-Employed)-or-Employee%3F
i would like to revive this thread-
i’m taking a hard look at it for this year. i’ve been playing with [MENTION=1]Chris[/MENTION]’ excellent employee planning tool spreadsheet and just getting a feel for how the numbers work.
i’m curious, though about how one would operate a hybrid model- hourly or salary with commission bonuses. i know some guys do that ,but i don’t know how it would be set up. anyone have any input on that?
also, is anyone switching back to hourly after trying commission based pay?
I am about to switch things up and because we work through winter I will likely do the following sometime in the near future.
Inexperienced: I will pay hourly. My idea on this is that your acquisition of a new employee costs time and money. I want to see if they are serious about sticking with me.
Expericenced: Salary with commission. In the winter it can be challenge for them to get every hour they need plus it’s miserable. The salary gives them stability and the commission serves as a “bonus”
I have not perfected this but I think this is what we will go to this year.
The guy I used to work for, 7 years ago, did this. I made $500 a week, plus a percentage. I don’t recall what it was. Anyways, after the holiday break, he sat me down and told me he was taking away my salary, and moving to straight percentage. Turned in to about a 65% pay decrease. All of this after I saved his business and ran it for him for 6 months while he went to California with “health” issues. I didn’t finish up that day with him, and started my own business that same day. 7 yrs ago Jan 5.
Once I get a dependable guy, who I think is going to turn into a lifer, I will pay salary with performance percentages.
Wow! Pretty much he thought you were making too much money and didn’t like it. I have no problem paying someone more than I make if they do what I do.
Moral of the story…people are greedy.
bump, specifically this part.
I’ve experimented with this in the past. Two years ago I had a guy who was a descent worker but he needed a kick in the rear to stay focused. In 2012 I paid him percentage hoping that would motivate him to work faster/ more efficient. Since I worked with him all year it didn’t change much. I just felt like I was paying him more and I was working harder to pick up the slack. 2013 went back to hourly and we went our separate ways in July. Now I am going to pay hourly all year, as I plan to work with my guys this season.
Point is if you pay percentage/ commission and you work with the crew it can end up where u are picking up the slack. However if you are not in the field then they have no choice but to pick it up if they want to make more money.
Last thing is that I think it really depends on the workers personality. I don’t have near the experience as a lot of the guys here but that’s my 2 cents Caleb. Trying to get this thread back on track.
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I pay on a two-tiered system. The helper gets paid hourly based on an employee certification program. The crew leader gets a commission on the job (after the helper’s pay is removed). This added incentive is designed to get the crew leader to use his helper as efficiently as possible.
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I think it’s real simple. Some guys are just hourly workers. Some are commission workers who see the advantage to busting it to make more is less time. I am the commission guy. I have worked in another field involving water on a base pay of $2.00 an hour and sliding scale commission system for quantity. I still hold the company records and it has been 17-18 years since I worked at that company. In my case I did so much quantity by improving efficiency that 2 guys could not do my job for the 3 weeks that I was on vacation or out sick. Unfortunately the company solution to this 3 week dilemma was to cut my work load so they could get the work done. It really did not make any sense for this crazy solution so I left the company.
Find the guys who want to work on commission and treat them well. Maybe set aside a sum for extra incentives like bonuses and contests to keep the job challenging and interesting.
I’m ‘all eyes and ears’ about this whole subject as well. Someone here explained to me in detail his system, and along with the other systems mentioned here there seems like a lot of good possible fits.
I have a question- do all these scenarios work for full-timers only or have some been paying non-hourly for part-timers as well. I can see straight commission working, but not necessarily salary+ commission if the weekly schedule varies.
I have one full-time employee that I am training. I started him at $9 an hour. I am working on a monthly incentive program to motivate him to move a little faster and earn more money. We clean lots of gutters this time of year primarily in January. I am paying him a flat dollar amount per gutter cleaning job we do. It will vary depending on the size job. For the average size property it’s $2 per job we do. We could do 15 or more jobs per day working together. I have put some stipulations on him. 1. He must be on time. 2. He must wear his uniform. 3. He must treat the resident with respect and their property. He would lose his incentive for that day otherwise for any of these reasons. In the future I would like to add commission pay and marketing incentives. What do you guys think?
$2 per job?
Did you mean $20 per job?
Finding employees willing to work is the tough part, paying them is easy. If they’re great workers pay them more, either commission, flat rate or combination of both.
My goal is to build layers of incentives as opposed to one or two ways to earn income. It’s a starting point for this month. $2 per gutter cleaning job plus his hourly rate. I have to take in consideration that he has no experience.
I do appreciate your feed back as this is a work in progress.
Thanks!
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for those owners out there who work in the field, how would you handle commission pay when you are personally on site? i get the percentages when your people work independently, but what if you are on the crew yourself?
i may end up in the field a little more than i thought this season, but i’m seriously considering implementing commission based pay for my people this year. i don’t know how to handle it though, for the days i would be on site working with them. any suggestions?
Have you seen the commission pay chart available to you through the WCRA downloads? The one Chris used at All County. I pay myself as the supervisor for field work. We also get Owners commission and Management commission.
65% pay cut! Reminds me of when I joined the Air Force back in 89, I took a 50% pay cut and I was just working the banquet department of a Hilton.
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yeah i have that. i just don’t know how the percentages would change if the owner was also doing labor. how do you work those numbers?
