I'm a master electrician and own a small business with 3 service trucks, 3 JW, 3 apprentices, and a part time admin for book keeping. About half the sales each year is from service work, the other half from new or remodel commercial work.
I'd like to have the employees take more interest in the profits and the only way I see to do it is to offer them some. I have heard of contractors paying a fixed hourly rate and allowing the employee a percentage of the sales (maybe 20%). Granted sales is not profit but it's a number that is seen by the individual collecting the money.
The average hourly pay rate for a JW here is $17.00. Service work rate is $80/hour plus materials.
If the JW was paid $10.00/hour and got 20% of a days collection of at least 4 billable hours $320.00/day time 20% is $64/day on labor only. This amounts to $8/hour from sales. He'd make $18.00/hour.
Similar concept on a bid job, such as a scheduled service replacement. A 200 amp service changeout in this area is between $1500 and $2300 (depending on where the old panel is, one story, two story, u/g or o/h feed). You'll have $800 to $1300 in materials. For arguments sake, say there is $700 after buying the materials, at 20% that would be $140.00 more than his base $10/hour pay, provided it was a one man job. If he did it in a 8 hour day, he'd make $30/hour,$10 from his base pay and $20 from sales (less materials cost). If it took 16 man hours, he'd make $18.75/hour. Good incentive to finish it quickly.
Sorry for the long post, but does anybody have any experience with incentive based pay and would you sign up for this?
