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11-08-2006, 09:11 PM
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#1
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Registered User
Trade:
General Contractor
Join Date: Nov 2006
Posts: 2
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Appropriate Commision ???
Employee X has connections which lead to our company potentially securing contracts for ground-up construction of at least 6 million in contract work and potentially more. (6M total in contract work, not 6M in profit).
As a reward, we offerred employee 10% of company profits resulting from the employee's connection plus $500 a week with no-obligations other than a good-faith presence (employee has no real trade skills).
Employee wants 25% of company profits resulting from this venture. (Based on 3 current partners plus him).
What does the board think. What is a fair industry standard?
Other information: He implied to our hiring customer that he was "not being taken care of" and the customer said to take care of our back-office or nobody gets anything.
Last edited by David_Hernandez; 11-08-2006 at 10:02 PM.
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11-08-2006, 09:13 PM
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#2
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Pro
Trade:
masonry
Join Date: Feb 2006
Location: Austin
Posts: 3,702
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I think he is nuts, and you should consult a lawyer before pursuing his "connections".
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11-08-2006, 09:31 PM
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#3
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My custom title
Trade:
Painting, faux, rock, plaster, texture, tile, laminates, finish carpentry contractor
Join Date: Jul 2006
Location: Tallahassee, FL
Posts: 1,559
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Walk, so what he has connections... obviously they need the work done. Someone tries to strangle me after I give them 10% and 500 a week to watch... i'll strangle them before the job is over fo reel.
ps your rates for commis is more than fair.
__________________
Benn
Quote:
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Originally Posted by Brian
Paint does a lot more than put color on a surface. It protects surfaces, it can reduce maintenance costs, it can enhance lives.
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11-08-2006, 09:44 PM
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#4
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Mod / ArchiBuilder
Trade:
Design/Build Construction
Join Date: Aug 2004
Location: ArkLaTexOma
Posts: 6,360
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Merged Threads.
Please no double posting.
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11-08-2006, 10:41 PM
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#5
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Pro
Trade:
underground
Join Date: Oct 2004
Posts: 3,079
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Quote:
Originally Posted by David_Hernandez
Employee X has connections...we offerred employee 10% of company profits resulting from the employee's connection plus $500 a week. What does the board think.
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I think employee X is a moron. A % of the profits?! How does he expect to audit that? Do you expect to turn your books over to the chump?
If it were me, I'd offer one-half of one percent of the ORIGINAL contract price - half paid upon signing and the other half paid upon final payment. On $6M that's $15K out of your pocket until final payment.
__________________
Quote:
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I got a [solar powered] smart house. And a robot. I'm bionic with laser eyes. My truck flies itself. A helicopter comes out of my hat. My suitcase turns into a car. I add 3 drops of water and dinner is served. I will never age. My bible is on the head of a pin. I have tiny machines in my bloodstream. I take an elevator to the moon. - Kyras
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Last edited by PipeGuy; 11-08-2006 at 10:44 PM.
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11-09-2006, 07:34 AM
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#6
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Contractor
Trade:
Excavation, Foundation, Concrete
Join Date: Feb 2006
Location: Maryland
Posts: 2,175
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Quote:
Originally Posted by David_Hernandez
Other information: He implied to our hiring customer that he was "not being taken care of" and the customer said to take care of our back-office or nobody gets anything.
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The more I read this phrase, the more I think "kickback".
It sounds as if you "customer" and your "salesman" have some sort of relationship established.....one I would stay out of if I were you.
What happens when you are 90% complete and suddenly 25% cut is not enough for "them" but they owe you close to a million bucks, do you pay more? 
My customers do not dictate how my employees will be compensated.
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11-09-2006, 09:07 AM
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#7
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Pro
Trade:
Custom deck builder
Join Date: Aug 2005
Location: Colorado Springs, Colorado
Posts: 3,050
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Are you starving for work? Is this the only job out there? If you dont need it and you can stir up your own jobs then fire the employee and continue to pursue jobs.
(If I had any employees) and one brought me a project... I would give him maybe 1% of contract price if that was not good enough... I would just continue on in my ventures.
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11-09-2006, 07:13 PM
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#8
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Pro
Trade:
EXTERIORS
Join Date: Aug 2006
Posts: 397
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WHERE ARE YOU LOCATED David_Hernandez
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11-09-2006, 09:36 PM
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#9
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Pro
Trade:
painter
Join Date: Dec 2005
Posts: 110
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We offer any employee 2% of the labor total for any work brought in to the company plus they get the hours by having steady work. 25% of proffit is crazy!
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11-09-2006, 10:42 PM
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#10
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General Contractor
Trade:
General Contractor
Join Date: Nov 2005
Location: Coronado, CA (Just outside San Diego)
Posts: 548
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Sounds kinda like blackmail to me... Better to stay away regardless of the monetary opportunity IMHO
__________________
"History does not long entrust the care of freedom to the weak or the timid”.
Dwight D. Eisenhower
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11-09-2006, 10:59 PM
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#11
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Ken & Teresa
Trade:
Landscaping
Join Date: Feb 2006
Posts: 14
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What is your average cost per lead if it was not a referral? If you did not spend any advertising $ acquiring the contract, 25% may be a workable number. However, your employee does have some nerve to demand that much. It would be 1 thing if you chose to award him that but it's another to demand it.
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11-15-2006, 10:54 AM
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#12
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Registered User
Trade:
Remodeling
Join Date: Nov 2006
Posts: 3
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If you do give the 25%, I need to come work for you!!!!!!
25% of the company profit is crazy!!!!!
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11-15-2006, 11:42 AM
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#13
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Contractor
Trade:
Remodeling & Home Additions
Join Date: Sep 2006
Location: Delaware
Posts: 1,694
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I think 10% is more than fair. This employee could be a janitor for all we know who knows of some other guy who needs buildings constructed. You may end up with a problem when it comes time to determine what 'profit' is. Maybe a finders fee would be easier-payed upon completion of the project.
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11-29-2006, 08:53 PM
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#14
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Member
Trade:
General contractor
Join Date: Sep 2006
Posts: 73
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Emp x? Put a dollor in his shirt pocket and kick him in ths B@LLS.
Stay the course on you work.
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12-06-2006, 01:15 PM
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#15
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Pro
Trade:
Painting
Join Date: Oct 2006
Location: Florence, Alabama
Posts: 2,264
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Quote:
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employee has no real trade skills
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What was his position or duties before he made this contact? How long has employ been with you?
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12-06-2006, 01:34 PM
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#16
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Deck Cleaner
Trade:
Deck Cleaning, Staining, Restoration
Join Date: Jul 2006
Location: Havertown, PA
Posts: 969
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You lie in bed with dogs you get fleas. Sounds very shady. Are the words "union" or "waste management" in context?
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