The contractor that I work for is trying to adapt a new policy. He want's us to pay for mistakes made. For instance one of the electricians forgot to re-install a service outlet on a panel that was upgraded. So he charged him 85 dollars(deducted from his check) to have one of the other guys go out and do it. He's also trying to say that if we fail inspection that we have to go back on our own time to correct the problem. Also he's saying that if we leave something out in a material list(T & M jobs only, I think)that we will have to pay for it.First of I highly doubt that this is legal, secondly has anyone heard of something like this before? Whats your take on it?

Its illegal here in California.

NOT HERE IN JERSEY

try that with my check and see you in court!!!!!!!!

While I don't know if it's legal, I say good for your boss. He probably needs to back off a little, but I understand exactly where he's coming from. The mistakes are costing him all his profit and probably more.
We have a very bad problem with nobody filling out their paper work. One form is a check list they are supposed to fill out on the job and if something was missed, fix it before they leave. They haven't been filling it out and then they have to go back a do work that they missed. We have a new policy that just took effect, if they come in without the check list properly filled out they have to go back to the job in their own car, off the clock, and fill it out. Am I a jerk, probably, but there has to be a consequence or they never will do it right.

Tricky balance here. The workers do need to be accountable to some extent. Otherwise, what incentive is there to keep them from turning off their brains? But some of those measures seem extreme.

The boss is the one whose money is on the table and rear is on the line. Risk. He (/she) is the one putting the chips on the table, and when the company turns a profit, it is his (and sometimes it is shared). So why should it be costing the workers when the risk that the boss takes on (owning his own company) does not go so well.

I think this would be fair if he had a profit sharing plan. When things go well, you all make out, and when you screw up, you all share that too.

Thin line between running a business, staying profitable and keeping employees happy. The good news is you apparently work for a guy who does not make mistakes, but if he ever does I'm sure he'll hear about it in a big way. Side note, there is no NEC requirement to install a receptacle at a panel when upgrading a service.

Give people a 'slice of the pie ' as part of their deal, and watch attitudes change.Few will tolerate 'their' money beig wasted>

Anyone ever heard of the fair labor standards act? It is a federal labor law.

I thought it was illegal to require an hourly paid employee to work off the clock. I would think the proper way of handling these situations would be to have quarterly performance reviews. The employees hourly pay rate could be adjusted higher or lower based on these reviews. If you have a employee that continues to be a poor performer than I would think this would be grounds for termination. If the employees want a raise then they need to complete the job properly including all paper work. Reward your best workers with higher pay punish the poor performers with hourly pay rate decreases or termination. I think positive incentives get better results than negative incentives. Start docking their pay and making them work off the clock and they just might not show up one day. Word may spread and others will not want to work for you. Your employees are the ones that your customers see. Do you want unhappy employees greeting your customers?

I can understand to some extent Rather than charge the employee I would keep track of the mistakes talk to the employee about their work and if the problem persists replace the employee. What happens if the boss makes a mistake? I worked for a company that the only way we got any work is if the estimator left about 30%of the job out of the price.Are you going to charge a long time employee for making a mistake?

Everyone makes mistakes. If you keep making the same mistake over and over again I would not classify this as a mistake anymore but a habit that needs to be corrected.

You leaglly can not remove any funds from your employee's pay that is not authorized in writing by both the employeer and employee. Plain and simple the hours you work is the hours you get paid for. you want ot dock the employee, no raise that year, no ot for him, etc but you touch his pay and you'll land yourself in a lawsuit. And dont try to hold it either that also not legal!!!!! THis is not a game when it comes to money there should be no well i feel this and he feels that. MY pay is my bread and butter mess with that and be ready to face the consequences plain and simple

NJ Wireman,

I agree docking their pay or withholding it is a bad idea even if it were legal. I worked for a contractor that provided no health insurance, no retirement plan, no vacation or sickleave and no holiday pay. Sometimes you would go weeks without a paycheck and then sometimes it would not clear. Imagine if he started docking my pay when I made mistakes. Most electricians in my opinion are underpaid and undercompensated and docking their pay isn't going to motivate them more. I believe most contractors don't charge enough for their services so that they can offer the proper incentives to their employees. If you want to attract the best employees you need to offer the best in compensation. Charge enough to compensate your employees well and they will take care of you and your customers. Employees could recieve a bonus at the end of the year based on their performance. The better their performance the bigger the bonus. Poor performance no bonus.
I believe positive insentives is the way to go. Start docking their pay and it may cost you more than you will ever know. If you have an employee on a service call and he has a chance to sell more work to the customer while there do you think he will when his pay has been docked. How do you think he will treat the customer? You may start loosing your customers.

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This company would be nice to work for. Go to www.google.com and type The Red Carpet Treatment By Antoinette Ursitti into the search window and read the article.

If he's gonna treat you like a sub.... Raise your rates! Otherwise, contact your state labor board.

I would find a new job immediately.

Sorry, but paying for your employees mistakes is one of the bad parts of being an owner.

I agree with the others you can not make people work for free, you can not make them pay for wasted matrial, you can not withhold or delay pay.

If an employee is a constant source of loss let them go, the message will get through to the remaining employees.

Bob

http://www.dol.gov/esa/regs/compliance/whd/fairpay/fs17p_construction.htm

You can not be forced to work for free, go here for more info.

http://www.wagehour.dol.gov/

Bob

bot540
Your boss is an idiot with his head in a guillotine.
1) Save the check stubs-with the deduction shown.
2) Find another company to work for.
3) File a claim with the Labor Board
4) Collect your money.
5) Don't look back

I worked for a company that had an "office manager" (flunky secretary) that would withhold paychecks if she didn't get "her" paperwork (not time cards) back on time, or filled out properly.
Mine was always in on time anyway. I mentioned to her that if she ever withheld my pay, I would stay home for up to 30 days, or until I was paid, and expect to be paid for the additional time spent waiting..
That is the law here in CA.
The practice was curtailed.

Interesting discussion.

Let's look at it from a third perspective. In Federal jobs the Contracting Officer (CO), COR (representative) and Inspector in finding this out will withhold payments until the situation of pay is corrected along with withholding final payment until the job is completed. Another way to state this is the contractor who does this will lose if discovered. Not a good way of doing business on this end either.

Personally I like the reward method. Give regular bonuses to the employees based on correct installations completed. You want to keep the best, so reward the best (this coming from the government who rewards to the lowest bidder, but are trying to get away from that and are now struggling to look at value also).

Shane

Hi,
I will tell you that in ARKANSAS and MOST states if you MAKE over $25K in a year THE LABOR DEPT WILL NOT HELP YOU COLLECT MONEY OWED BY AN EMPLOYER!

Documentation is part of the job just like safety...the emplyer needs to find people that can do the work.

Just fire the guy after a time or two and move on! There are plenty of concientous electricians out there that would probably do the job.

I say if the employee fails to perform why lay him off for a day or two, then if his performance doesnt improve terminate the person for failure to perform. When I worked nuclear jobs, the policy was that if you left a tool out overnite and you did not follow plant policy..you got an unscheduled vacation..1,2 or 3 days. Then if it happened again..BYE BYE.

The employer\employee relationship is a give and take relationship.

As far as witholding pay and charging for mistakes that is pretty comical!

Just my two cents!

-regards

Mustang

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This hasn't happened to me yet, but if it does I will be calling the labor board here in Illinois. I understand he doesn't want to pay for our mistakes but like most of you said their should be an award incentive. All employers should relize that no one can screw you worse than your employes and when you take care of them they take care of you.

Mustang, If ya'll have so many extra qualified electricians in Arkansas, I wish you'd send some to Georgia. We can't find any really good leads or helpers(new hires, we like the ones we already have) . The good ones seem to have jobs and hold on to them. We're willing to pay top rates for top help, but they don't apply.

As for our policy on paper work and the do it on your own time. It was a suggestion by an employee at our weekly meeting and all agreed. We also haven't had the need to enforce it yet, it seems to have provided the motivation to get it done.

As for the law on wages. As long as the employees wages average out to more than minimum wage including time and a half for overtime no law has been broken. That said, I do agree that you can't back charge an employee for materials or charge them for having someone else make corrections.

That would not work in this area, you would not have any employees.

It sounds like this particular boss is 180 degrees out-of-phase!

I would have a severe arc fault if someone tried to pull that kind of garbage on me. Indeed, bot540, a disgruntled employee can cost the company many, many, many times over.

I use a flat rate pricing system so if the book says a job will take 6 hours but the technician completes it in 4 hours the customer is still billed the same amount. The 2 extra hours of time would go to the technician. At the end of the week he would have physical hours worked and the extra billable hours. Any call-back time could be taken from the extra billable hours.

Payroll Example: The tech. physically worked 40 hours during a given week, but he billed our customers a total of 49 hours while performing 27 service calls. He would receive pay for the 49 billable hours. In addition he would receive travel time equal to thirty minutes multiplied by 27 service calls for a total of 13.50 hours. This gives him a total of 62.50 hours of payroll time.
He had 2 call-backs this week at 2 hours each for a total of 4 call-back hours. These 4 call-back hours would be deducted from the 9 extra billable hours that he had earned for the week. This would reduce his billable hours to 45 hours. His new total payroll hours would equal 58.50 hours.
He would be paid straight time for 40 hours and overtime for 18.50 hours.

I'm not currently doing this but is something I am looking into.
What do you guys think?

I would go work for someone else.

I have no interest in being an assembly line worker.

Pay me for the hours worked, no more no less.

Iwire,

You are getting paid for all the hours you work. The other hours are bonus hours you earned because you completed the job quicker than what was billed for. You will never get paid for less hours than you actually worked. This rewards you for being more efficient. I can understand not wanting to be paid for less hours than you actually work but why would you not want to get paid for more hours than you actually work. Don't you like bonuses? The way you work is not going to change. The standard way of paying you would only get paid for actual hours worked. This way you always get paid for actual hours worked plus you earn extra when you complete the job in less time than what was billed to the customer. If you take longer to do the job than what was billed to the customer you will still get paid for all of your time you worked. I don't see how you could lose with this situation.
If the job took you 6 hours but the book shows 4 hours you would get paid for 6 hours even though the customer was billed for only 4 hours. If the job took you 2 hours your would get paid for 4 hours.
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[This message has been edited by A-Line (edited 12-09-2004).]

Ok so let look at it this way;

I work a 40 hour week all jobs down as to spec time wise.

How ever i had 3 return calls each requiring 2 hours.

How are you handling this, would i still get my 40 or would i lose out do to the call backs?

You would never be docked for actual hours worked only for bonus hours earned. So if you actually worked 40 hours that week and 2 of those hours were call back hours you would still get paid for 40 hours. You would only get call back time deducted from bonus hours never hours actually worked. If you get call backs and don't have any bonus hours to deduct from that week then no deduction would occur. Another way to handle this would be to foward the 2 hour call back debit to another week in the future when you do have bonus hours earned. In other words if you didn't earn bonus hours this week but had 2 hours of callback time and next week you earned 4 hours of bonus hours then the 2 hours of callback time from the previous week could be deducted from this weeks bonus hours leaving you with 2 bonus hours earned.
No matter what happens you will always get paid for any hours you actually worked.
So the simple answer is yes you would get paid for 40 hours.

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Sounds like a good deal my only thing would be i would only do week for week i would not carry the deduction over to another week. Other then that are you hiring???????LOL

HHmmmm, Is this guy my old business partner?
He insisted on doing something similar. An employee turned us in to the labor board. The labor guy was in our office for days and went back through all employee records from inseption......Your boss does NOT want that to happen.. It ended up costing a fortune in back pay over everything from travel pay to when an employee starts the work day when driving a company vehicle.

The employee gets paid for every minute he is on the clock including travel time. The 30 minutes travel time is just an estimate it can be adjusted if necessary. If it takes longer than 30 minutes then it can be increased. If it only takes the employee 15 minutes of travel time he would still get paid for 30 minutes. I cannot see how they would ever be owed any back pay as they are being paid for every minute they are on the clock. They would not be putting in any travel time for free. These bonus hours are simply extra hours they earn not hours they actually had to work. They could be paid out quarterly or even anually as a bonus if not paid out weekly. The employees current hourly rate of pay would not change with this plan. He would never lose any of his regular pay with this system. This is not peice work.
What's in it for the employer? Happy, motivated employees who are completing jobs on time or in less time and making more money for both the employee and empoyer. Seems to me both parties win with this.
If you don't like the term bonus hours you could call them value points or something like that. The employee could be paid out each quater for how many value points he has earned for the quater.
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It is not legal in Colorado, anyway, to bank hours.
(BTW, Aline I was referring to the original post not your post.)
Here was the situation.

It drove my partner nuts that guy's would turn in 44 hours one week and turn in 36 hours the next week causing O.T. pay one week and leaving us short handed the next. We ran on a two week pay period so he would average it for an 80 hour pay period in the above example and not pay the O.T. for the first week. Not legal.

My guy's would often ask if they could comp their time for their own benefit and work extra hours one week so they could take off work, say, early the next Friday. I would agree but insisted that they leveled the time card to show 40/40 and apply the time to the appropriate job...... That is not legal either but I did not know it at the time.

There are a million ways to provide incentive for quality work but I don't think messing with hours is the way to do it.

Hi,
I think the best way to address this is the following:

PROFIT SHARING or COMP TIME.

Comp time is extra time worked over what you would normally work. You can use the comp time for time off or cash it in when it hits a certain limit or period..do not allow it to go over 200 hours in a quarter or allow it to be carried over to the next year..

profit sharing is giving the employee a slice of the pie..pay dividends to the employees and recognize the ones that excell by providing incentives like tools or safety awards..

An employee must be compensated for his time so I do not see where you are giving anything away. If a guy works more than 40 hours then pay him for it unless he is on a salary.

-regards

Mustang

A-line,

That's an interesting idea. I think that most auto shops work on a similar basis. Everything is billed at shop rate, those who are fast and produce the most billable hours make the most money.

It does create a situation where certain jobs are more attractive than others. And if you have more than one tech keeping the "good" jobs and "bad" jobs even can be a problem.

Good luck with whatever you decide to do.

GJ

This is a profit sharing plan. The employee gets paid for all hours worked just like he always has nothing changes here. When I price a job I estimate how many hours it will take. If I estimate it will take 10 hours and the employee does it in 8 hours all the money for the 2 extra hours I figured the job would take would go to me and none would be given to the employee for completing the job quicker than I had estimated it would take. What incentive does the employee have for completing the job quicker? He is getting paid less for the same amount of work. If he worked slower he would get paid more for the same amount of work. With the system I am talking about I am simply giving him some of the money for the extra 2 hours that he din't use to complete the job. Instead of 2 hours you could call these points. The employee would then have 2 points included in his file. At the end of the quarter he would be paid for the points that accumulated in his file. These points could be included in his performance review.
These points in no way represent any hours that he worked. These points could be paid out in any way you wanted to. They could be paid out at $10.00 per point. They could be used to determine his pay raise for the year.
The more points the bigger the raise he gets.
They could be paid out as a bonus at the end of the year.
With this system an employee could work only 38 hours and still get paid for 40 hours. An employee would never work 40 hours and only get paid for 38.
This is not a system I made up myself. I think this system is used in the plumbing and HVAC industries to compensate their technicians. As far as I know plumbers and HVAC people are making more money than electricians. Why is this? Are our services less valuable? I don't think so.

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Aline, your program is great in my eyes, i know i have worked at many companies that stiff you out of alot of money such as return travel time back to shop unpaid etc.

I know if i were near ya i would jump on working for you that is a amazing incentive program!!!!!!!!!!! Great Idea

Thanks for the feedback.

I don't currently have any employees. I just started my business. I'm just trying to get prepared for if or when I decide to hire. I thought maybe some business owners might already be using a system something like this and wanted to get some feedback. I'm not sure if this system will work or is even a good idea.

Thanks for your replies.

To the guy who started this thread, if you are not union you might want to contact the local hall in your area. In this area a few years ago a non union contractor did not pay scale to his employees on a city govt job. The union got wind of this and let the city know. The city witheld payment until the guys got all the back pay. Yes, the union will goto bat for non union at least around here. Besides I think we organized a couple of them.

IS there any way to use this system on residential houses?

A-line, I don't know, I think you'll find your employees arguing over who gets the easier jobs. Also, encouraging employees to complete jobs in the shortest amount of time is not conducive to good workmanship. I think a boss who communicates well with his employees will be 99% sure of who is doing a good job or not. You should award bonuses based on your profit for the month/ quarter or year. But above all........Shout your employees a beer on friday nights and don't talk aout work while your having those beers.

I think you could use this system in about any situation except T&M. If you know how much time you estimated the job to take and the employee completes it sooner than you would know how many points to award. As far as employee fighting over taking the easiest jobs on service calls the employees are dispatched out on jobs as they become available. If the estimated hours for the easier jobs are less than for the more difficult ones I don't see how job difficulty would matter. The tech has more time to complete the difficult job. He gets points based on the difference of estimated time and actual completed time. If you have more than one employee on the same job they would split the time for the entire job.
If they do a poor quality job they should understand that they would loose all points.
You wouldn't even have to let the employee know that you are using this system if you don't want. You could secretly keep track of each employees points earned and base pay raises and bonuses on these amoung other criteria.
I think were this system works best is in the residential service business. The employees are turning in invoices with their names on them making it easier to track.
They should also be rewarded if they sell aditional work while there. Such as installing a GFCI recpt in a bathroom.
I don't know if quality would suffer as I have never used this system. I was wondering if someone has and if it has worked for them.
I believe if the employee doesn't have some kind of incentive to complete the job quicker that they may get slower at doing them after awhile if there isn't anything in it for them.
I don't think you will ever find a system that is perfect. I think all will have pros and cons. Just need to find one that has more pros than cons.

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