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#156891 - 07/25/05 12:53 PM Business Ethics
Dnkldorf Offline
Member

Registered: 12/12/04
Posts: 1091
Loc: nowhere usa
Not to steal a idea of Reno, But a question comes to mind.

How many of you pay your technicians, or electricians bonuses or commissions on what they sell?

I have heard this pratice is ongoing, and seems unethical to me. Is seems some guys, rather than correct or fix a given problem, try to sell customers on big upgrades or extra services they don't need.

What do you folks think of this?


Dnk.....

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#156892 - 07/25/05 06:07 PM Re: Business Ethics
renosteinke Offline
Cat Servant
Member

Registered: 01/22/05
Posts: 5305
Loc: Blue Collar Country
Very good point, D. Anyone out there have a bonus/ commission plan, please share with us both the details of how it is applied, as well as feedback as to how it works out.

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#156893 - 07/25/05 10:50 PM Re: Business Ethics
Rich R Offline
Member

Registered: 04/25/05
Posts: 29
Loc: Florida
I was on a comission plan before I went out on my own. It was 1% of my gross income from jobs I did that month......some jobs I sold myself but most were already setup quoted price.

The commision was in addition to my regular check also.

In my case the commision was based more on production than on what I sold. It gave employees the extra incentive to get the job done as quickly as possible, there was also clauses that made sure the job passed all inspections and was actually profitable.

For us it worked out, I averaged $40,000/month in jobs and I got an extra $400/month average, I made sure my helper was taken care of also... lunch bought for him everyday etc. as they say "everything rolls down hill" that applies to good and bad

Now to what you guys are saying, I agree, I don't think this should apply to people actually selling the job, I mean that would make us like a car salesman selling the undercoating

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#156894 - 07/27/05 12:15 AM Re: Business Ethics
macmikeman Offline
Member

Registered: 07/16/02
Posts: 718
Loc: Honolulu, Hawaii
I used to manage very large projects for a big time Dept. of Defense contractor. I got big bonus's for negotiations of change orders that exceeded a set amount. My hit was 10% of any CO that I exceeded the wished for amount the company was after. Once I got 60 thousand above the settle price.

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#156895 - 07/28/05 02:04 AM Re: Business Ethics
Pat@Amber Offline
Member

Registered: 08/23/04
Posts: 107
Loc: Gaithersburg, MD USA
I don't offer a comission plan but certainly would if my guys were bringing in $2,000 per day each ($40,000 per month).

What type of work were you doing Rich? Do you think your output would have been significantly less if you did't have that $400 incentive. Just curious.

Pat
_________________________
Power to the people

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#156896 - 07/28/05 02:17 AM Re: Business Ethics
iwire Offline
Moderator

Registered: 01/05/03
Posts: 4343
Loc: North Attleboro, MA USA
Where I work we have an incentive program.

It is a fairly complicated formula to distribute profits from each job. I have done well with it.

I do not find anything unethical about trying to get more work from a customer.

Lying to a customer to get more work is unethical, but simply pointing out things we could do for them is part of my job.
_________________________
Bob Badger
Construction & Maintenance Electrician
Massachusetts

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#156897 - 07/28/05 09:46 PM Re: Business Ethics
Rich R Offline
Member

Registered: 04/25/05
Posts: 29
Loc: Florida
I did Commercial and residential service work with that company and is what my company does now also. I'm not sure how prices are in different areas but an example of a typical day for me was a Service upgrade and interior breaker panel change.

A lot of houses down here have old 100 amp services outside and fuse boxes inside the house, the average price for this work was anywhere from $2300 - $3000. We would do this in a 8 hour day but keep in mind this is with a really good helper that can do things on his own without any problems and little supervision.

Another example would be a breaker panel change out in the morning...get done by about 1pm and then a do a couple of small service calls (ballast change outs, outlet added for an office etc..) average breaker panel change here is around $1100 and the service calls were billed at $99 for first hour plus $75 for every hour after that and materials plus $50/hour for the helper.

To answer your question about the output being less if there wasn't an incentive, the answer is yes. Those service upgrades especially are normally a 1 1/2 day job and without a real reason to kill myself getting it done I wouldn't have. I also think you have the right kind of people on the incentive plan to begin with. I don't think it will motivate a person who is not self motivated to begin with.

Another one of the things they had set in place was that if a journeyman couldn't produce $4000/week he wasn't eligible for the incentive plan. The type of work we had and the volume of it, it would be pretty hard to not make that in a week unless there was a problem with that electrician

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#156898 - 07/29/05 10:52 AM Re: Business Ethics
renosteinke Offline
Cat Servant
Member

Registered: 01/22/05
Posts: 5305
Loc: Blue Collar Country
Let me give you a real example, from two days ago.

A home with circa-1940 service suddenly lost power to one side of the fuse box. The customer was planning to do a service change this fall- but wouldn't really be able to afford one today.

I get the old service apart, and find that one of the clips on the main fuse holder was ever so slightly bent, and wasn't making contact with the buss. No signs of overheating or arcing....turns out the had just done some remodeling, and pulled the 'main.' Probably got dropped, or something like that.

Now I could have done the service change...the customer had already been "sold"...but would that have been ethical, when the problem was fixed in fifteen minutes?

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#156899 - 07/29/05 05:56 PM Re: Business Ethics
Dnkldorf Offline
Member

Registered: 12/12/04
Posts: 1091
Loc: nowhere usa
No Reno it would not of been.

Honesty is what keeps customers coming back.


Would you like an AC guy to charge you for a whole condensor if a contact was bad?

Would you call on him again if you found out?


What if this was a TV news setup, and you just been taped BSing this homeowner?


Dnk.....

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#156900 - 07/29/05 09:31 PM Re: Business Ethics
Jps1006 Offline
Member

Registered: 01/22/04
Posts: 609
Loc: Northern IL
Quote:
Now I could have done the service change...the customer had already been "sold"...but would that have been ethical, when the problem was fixed in fifteen minutes?


I don't think it would necessarily be unethical had you changed the service. I think when it comes to ethics it is a matter of intent and whats truly in your heart that is the issue. I've never taken an ethics class or even looked up the term in the dictionary so I don't know if I'm adhearing to the proper meaning and if it would differ from making a moral choice or a distiction between what is right and wrong (and then you have to ask yourself "right or wrong in the eyes of whom?")

But had you changed the service and done it for the right reasons, people could call you a con or cheat, but it wouldn't necessarily make it so. What if you trully didn't trust the bend would restore the contact to the proper tension as it had when it was listed. That would come down to a difference of opinion or expertise, not an issue of morality .The guy said he was going to change it soon anyway, why would it be wrong to push his schedule?

But had you thought to yourself "ooooh, I could get this working for him now, but my needs are more important, and I got him where I want him" then in my mind, wrong. I believe it is the intent to do evil that makes it wrong, or the blantant disregard for what actually might be good is also evil. That's why these are important things to think about. I personally belive it is just as evil to intentionally do wrong as it is to say to oneself "I don't know and I don't care to make the effort to find out."

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