How do you explain flat rate to auto body technician employees?

Answer 1

Flat rate is being paid for what you do not how long you are at work. Technician's that work hourly may receive $ 10.00 per hour. If he or she works 8 hours they receive $80.00 for the day. A flat rate employee is paid off the hours on the estimate. If the tech get an estimate with 20 hours he is paid 20 hours for the job whether it takes 10 hours or 30 hours.

The tech working flat rate has an incentive to work faster because he can do the 20 hour job in 10 hours and be paid 20 hours because he was fast and efficient with his time. The 10 dollars an hour then becomes 20 dollars an hour.

The business owner does better with a flat rate tech. Every time the tech does the work in half the time they make double. A $62 per hour shop rate becomes $ 124 per hour. If the tech Makes $15.00 per hour on flat rate a 20 hour job pays $300.00. If the tech did the work in 10 hours his pay was 30.00 per hour.

The shop charged $1240.00 paid the employee $300 with a difference of $940 for ten hours of work. After paying the employee the shop then made $94 dollars per hour on the job.

The hourly person has no incentive to work more efficiently because he always makes the same wage. If he spends 10 hours on the a 5 hour job it the same pay as if he spends 2.5 hour on the 5 hour job.

The shop has to be busy for a person to work flat rate because if there is no work in the shop there is no pay. The hourly worker gets a check even if the shop has no work. They can sweep or clean and get paid. Flat rate workers have to wait for another car.