What is your commission % if you work with the employee

For those of you that pay a percentage of the of what the truck makes that day to your employees. Like let’s say it’s 30% for the truck. Split 15 each for 2 techs and all if it’s one. What percent do you give if you are the owner and and work with one tech together for the day. Do you still do 15 each or he gets all 30. What’s fair in that situation?

I would probably do 25% for me and 15% for a full speed employee.
Yes, I realize 40% is high but I work fast, am gentle with the equipment and pursue upsells and repeats. If it was two employees it would be 15%ish for each of them.

Good question. Take what you’re worth- as a tech. If you would have given a high-performing lead tech 18% and the helper 12%, then do that. Or if you’re working with a tech who performs at a similar level as you, then split evenly (or maybe give him just a little more)

Alternatively, you could pay yourself as a helper (~12-13%) and leave the remainder for your high performer. Don’t forget that you’re still making money off the job from the other 70% that covers all other overhead - including the owner’s salary & profit margin.

Hypothetically speaking, I’d probably go with that last option. If I’m working the office most of the time, and I go and help out the team occasionally, I’d probably work at a similar level as a helper with some experience. I probably wouldn’t feel like busting it out like I do now :smirk:

@Chris was doing commission pay IIRC, but I don’t think he was working in the field at that point. He may still have some helpful input on the question, though.

You’d just be robbing Peter to pay… Cephas. Your extra 10% would come from somewhere… likely your profit margin, which you could take a draw from at the end of the quarter. From a tax perspective, you might be better off just paying yourself the 15% :thinking:

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If your paying yourself a salary, why would you pay yourself a percentage also, just because your in the field?
Your salary should cover your position.

I’m just looking for clarity on this.

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Well, this is totally hypothetical for me, but the way I see it is this:

If I have the choice of making x salary for sitting in my office and making phone calls, or go out and bust my hump with the crew to still only make x salary… well, you’ll find me in my office making phone calls.

If I know I can make x plus y for putting in the extra work- it seems like some more incentive. Plus, I think it would help me on a psychological level to feel like on of the crew while I’m out there.

And looking at it from the employee’s persective- they’ll be begging me to work in the field if they know they’ll be getting my portion of the tech compensation. I’ll be their favorite workmate, and they’ll resent it when they need to split the compensation with another employee. Keeping the split keeps things consistent.

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My example (me at 25%, employee at 15%) was based on a conceptualization that I would use if there were other shareholders.
My current situation is I am the only shareholder and I am also a salaried employee of the S-corporation. Rate of taxation for capital gains is less than it is for employment wages so my salary is a modest but legit amount.
Currently I pay employees on an hourly basis but I am always interested in other methods that can incentivize employees and create efficiencies. When I used to fish percentages were the only pay system and that kept everybody motivated.

I can understand how adding x+y would motivate a individual (owner) and drive you into the field in certain situations.
I just feel a salary should cover your needs and the company’s needs…If you understand what I mean. Not saying its right or wrong.

I think a percentage for everyone keeps everyone motivated to perform.

Thanks for the response Alex.

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So my thinking is this, if you have a tech who you would normally pay 30% if he works by himself and does the work all day in the truck. He gets 30% of what the truck mix. However if you work with him all day why would he make 30% still with a helper Even if it’s you. You make the same at the end of the day whether you help him or not. I’m just curious because I haven’t switched to commission I’m still doing hourly but I’m just thinking about it at this point. However I’m all for paying a fair wage to my employees, just trying to figure out a good way to do this where everybody is happy until I have two techs in their own truck. ( which hopefully will be next season I’m hiring another tech on Monday.)

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Logically, @Deanswc, you are right.
if the % is set for a job, whoever gets the job share the %.
The way it works in our company, it’s 35% for a job. If the guy is alone, he gets 35%, if there are 2 of them, they each get 17.5%. 3 guys? you do the math.

now, I’m the team leader so my % is higher at 45% for jobs. When I work with another guy, he gets half of his 35% and I get half of my 45% at 22.5%.
It’s actually better for the owner to pair me with a guy than to send me alone because he saves close to 7% in fees.

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