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Creative paying methods

Discussion in 'Business Operations' started by BLC1, May 1, 2009.

  1. BLC1

    BLC1 LawnSite Senior Member
    from Ohio
    Messages: 718

    Does anybody use creative payment methods for your employees. Does anybody pay a percent of what the job is worth to you no matter how long they are there. This would be right along the lines of paying by billable hours. I am curious as to how this is working for you guys and also how much research you did up front to really define each and every cost to you so you know exactly what you will be making per billable hour.

  2. Littleriver1

    Littleriver1 LawnSite Senior Member
    Messages: 811

    Pay them by the hour. Those guys don't under stand all that mombo jumbo. If they don't do what they should then get some one else. I don't want my guys to know about my pricing.
  3. Fvstringpicker

    Fvstringpicker LawnSite Fanatic
    Messages: 7,648

    You don't say what your objectives are. I think your better off paying a hourly rate and have some kind of bonus or profit sharing plan.
  4. LouisianaLawnboy

    LouisianaLawnboy LawnSite Silver Member
    Messages: 2,199

    Horse whip. . . . .
  5. BLC1

    BLC1 LawnSite Senior Member
    from Ohio
    Messages: 718

    I was discussing some options with a guy who does this in a different idustry. He said so far it is working out great for him. All of his guys are out in the field knocking on the neighbors doors and leaving door hangers out. It has turned everybody into a salesman.

    The guys are paid per billable hour. So if they are mowing a lawn that is a one hour job they get paid for billable hour. Then if they knock on the door and say hi Mrs. Johnson were done with the lawn is there anything else you may need done today, they can pick up another billable hour by trimming bushes, pulling weeds or whatever else it may be. Meanwhile, if they want to take there time, eat a long lunch, bs in the morning at the shop or in the afternoon when they get back thats fine.
  6. bohiaa

    bohiaa LawnSite Fanatic
    Messages: 5,220

    This can work wonders, " have to check your local state laws 1st"

    I have a friend who has a tile business, " for 25 yrs now " he doesn't pay taxes on his employees because he has none... according to the state of texas. but he has 25 guys working for him...

    Come to find out, he pays them a percentage from every job. this way he claims there sub contractors. however he provides the tools and such. so I'm not sure how he's doing it, but he's not in jail............YET.
  7. BLC1

    BLC1 LawnSite Senior Member
    from Ohio
    Messages: 718

    Nobody does anything outside of the norm?
  8. WoodBrothersLC

    WoodBrothersLC LawnSite Senior Member
    Messages: 418

    Buy my guys a case of beer or something every once in awhile on Fridays since they are college guys like myself. :drinkup:
  9. mikey.hill

    mikey.hill LawnSite Member
    Messages: 145

    Pay them with gold coins. No really, I can tell you from the flipside that I've worked for 2 lawn care companies. Mowing is not rocket science but it can be hard work. The first company I worked for none of the guys had been there more than a few months and my boss was perpetually looking for employees. Didn't take me long to figure out why. His promise of insurance vanished after a month(was supposed to get insurance after 3). He constantly paid us late and refused to let us record our own hours(although most of us did anyways). Turns out he shorted us on paychecks and even after asking him about it, which he denied, his behavior continued. Most of the guys eventually quit, leaving us shorthanded - and we did a crappy job trying to make up the work. He's no longer in business - imagine that.

    2nd company I worked for paid on time, paid a fair market rate without having to haggle about what my hourly rate should be. Offered bonuses and incentives to do a good job quickly. Also provided insurance 3 months after starting there. They're now one of the larger outfits in my area.

    I moved on to a different career after a few years where I manage a few employees. Important lesson I learned was if you treat your employees well and make it easy for them to do their job, your doing yours.

    @bohiaa he probably does a 1099. Those employees are required to pay taxes at the end of the year but their is a workaround to that. If the work completed is less than $600 they don't have to report. I've done jobs where it's less than 600 and I didn't report, the difference being it was a one time job for a client not a weekly or bi-weekly paycheck. I can't imagine a business getting away with this for long because someone at the IRS is going to pick up on what he's doing. Bet he gets slapped with a huge penalty eventually.

    for anyone interested in a good salary model this is a good read:
    Last edited: Jun 1, 2009
  10. ontheouter

    ontheouter LawnSite Member
    Messages: 11

    My experiences at being both an employee and employer are that most employees are happy enough doing what they are doing, and really don't expect very much from their employer, but they all want to be treated fairly and paid fairly for the work they do, very few people will tolerate a boss who treats them like dirt or rips off their pay. So treat em well and pay em fair is what I have learnt, and this will keep most employees happy enough.

    Once in a while you come across a fantastic employee, these are the guys and girls that add value to a business more than any other. These are the ones who need to be treated better with more leeway, more responsibility and more pay or bonuses. Obviously this will make other employees envious, so get around this by giving the fantastic employee some new fake title of some sort to explain away their higher pay to the others.

    Probably the last thing I would say is about adding bonuses every week to all employees, it doesn't work. It just becomes seen as part of the pay and not a bonus at all because they keep getting it for not achieving anything different. Better off to give a bigger bonus sporadically once every so often and link it to some fake well paying job, where you are sharing the win.

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