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What Is Your Bonus Plan For Staff Performance?

 
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Old 01-30-2014, 01:34 AM   #1
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What Is Your Bonus Plan For Staff Performance?


How do you reward your staff for production?

Do you reward everyone or just leads or something else?

Why or why not?

Do you pay by the hour? Salary? Project? Other?

What is your philosophy for motivating staff?

Do you have a bonus incentive for subs?

Are you hands on or do your leads cover all project site supervision?

Last edited by PoleBarnsNY; 01-30-2014 at 06:04 AM.
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Old 01-30-2014, 05:47 AM   #2
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Re: What Is Your Bonus Plan For Staff Performance?


what i do is one home a year i will split all of the profit with guys that work for me no one knows what home it is till the end of the year.
a guy that i worked for back in the 70 did it and i seen first hand the way it got everyone to do good work all of the time.

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Old 01-31-2014, 08:19 AM   #3
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Re: What Is Your Bonus Plan For Staff Performance?


I don't believe in giving bonuses.

I believe in paying an employee exactly what I think they are worth at the time they do the work.

If I pay the employee a fair wage for his work I see no reason to dangle a carrot in front of his face to try to get a little more work or loyalty.

I keep only top producing employees and bonuses would not get me better quality work nor would bonuses get more loyal employees.

Bonuses do not make employees stay longer because I don't pay bonuses and I never had an employee quit due to the amount of money he made and virtually never had an employee quit for any reason with the exception of health issues, or they changed their type of career.

I believe that every payday the employee and I are 100% even. If my employee wants to show up for work the following day that is his choice and it is not because he has a future bonus coming.

Bonuses cause several problems and they can be unfair to many employees for many reasons. You could end up paying a bonus to employees who deserve them well and to keep the peace you will have to pay equal bonuses to employees who don't deserve them, or you will end up with discrimination problems.

When you mention the word 'bonus' your employees expect a bonus whether you make a profit or not because employees don't want to look at your books and they don't want to hear about your problems. When you offer bonuses it is impossible to get more work or more loyalty from your top producers and most loyal employees because they are already on the top of their game. The poor workers and less loyal employees will not work harder just because you offer the bonus and you will have to pay them to be fair. So, where is the gain?

So, I believe it is better to pay an employee for what he does and don't create problems by trying to make your employees work harder by dangling a carrot in their face.

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Old 02-01-2014, 06:56 AM   #4
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Re: What Is Your Bonus Plan For Staff Performance?


My view is- that you are known by the company you keep.

I want to be surrounded by interesting people who are quality individuals, happy in their work and willing to go above and beyond

S0- my employees are paid ABOVE the local rate.

they have been covered by medical benefits for years.

Basic uniforms( shirts primarily- though I shower them with new dickies/Carharts, duluth pants through out the year

I GIVE them a lot of tools- cordless drills, saws etc.- one day last summer I gave them Lie Neilson planes as a thank you for the job I Knew they would do on an up coming project

they drive company trucks

Bonus-------------- up through 2013 they each got a flat rate sum as a bonus- for example on 12-16-13 each employee got a bonus in an amount sufficient to act as a down payment on a house. All employees got the same amount

In 2014 we are going to try something a bit different. Of course the employees will still be paid their wages and continue to earn raises in their wages- but the bonus structure will change- in fact I hope the change in structure will INCREASE their bonuses.

Basically- they will be paid their wages

All profits accrue to me up to level "X"
Level "X" is the average of what I have personally made over the last 10 years- excluding one super duper year, LOL
the first $10,000 above "x" is is a 80/20 split (me/them)
the next $10,000 is a 70/30 split
the next $10,000 is a 60/40 split
Above that it will be AT LEAST a 50/50 split- in fact it might go down to a 30/70 split.
I think their 2014 bonuses will substantially exceed their 2013 bonuses

folks- I have enough stuff- I don't need any more.--- I want these men to own their own homes, I want their wives to have nice clothes- I want their kids to attend good schools and have good medical care. the men exercise good judgement- they don't need me to hold their hand and they participate in the management of the whole enterprise including decisions as to product line/services we offer

Best wishes all,
stephen
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Old 02-01-2014, 02:42 PM   #5
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Re: What Is Your Bonus Plan For Staff Performance?


At the end of the week take 100$ from your least productive employee and give it to your most productive employee
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Old 02-01-2014, 06:38 PM   #6
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Re: What Is Your Bonus Plan For Staff Performance?


Quote:
Originally Posted by Stephen H View Post
My view is- that you are known by the company you keep.

I want to be surrounded by interesting people who are quality individuals, happy in their work and willing to go above and beyond

S0- my employees are paid ABOVE the local rate.

they have been covered by medical benefits for years.

Basic uniforms( shirts primarily- though I shower them with new dickies/Carharts, duluth pants through out the year

I GIVE them a lot of tools- cordless drills, saws etc.- one day last summer I gave them Lie Neilson planes as a thank you for the job I Knew they would do on an up coming project

they drive company trucks

Bonus-------------- up through 2013 they each got a flat rate sum as a bonus- for example on 12-16-13 each employee got a bonus in an amount sufficient to act as a down payment on a house. All employees got the same amount

In 2014 we are going to try something a bit different. Of course the employees will still be paid their wages and continue to earn raises in their wages- but the bonus structure will change- in fact I hope the change in structure will INCREASE their bonuses.

Basically- they will be paid their wages

All profits accrue to me up to level "X"
Level "X" is the average of what I have personally made over the last 10 years- excluding one super duper year, LOL
the first $10,000 above "x" is is a 80/20 split (me/them)
the next $10,000 is a 70/30 split
the next $10,000 is a 60/40 split
Above that it will be AT LEAST a 50/50 split- in fact it might go down to a 30/70 split.
I think their 2014 bonuses will substantially exceed their 2013 bonuses

folks- I have enough stuff- I don't need any more.--- I want these men to own their own homes, I want their wives to have nice clothes- I want their kids to attend good schools and have good medical care. the men exercise good judgement- they don't need me to hold their hand and they participate in the management of the whole enterprise including decisions as to product line/services we offer

Best wishes all,
stephen
are you hiring ?
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Old 02-01-2014, 08:32 PM   #7
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Re: What Is Your Bonus Plan For Staff Performance?


We get a small bonus at xmas, under $300 per person.

Most of us have been with the company 10+yrs. When things are good we get some perks, but it hasn't been great the last few years and I think we are all just happy to be working. Those that enjoy there line of work stick around, most of us worked together at calpac, and just moved to a different company when calpac closed...I have known most of our employees for 15-25 years at this point. I used to work for a much larger roofing company from 85-96 (CalPac), they did have a bonus system in place for each month and did provide a huge summer BBQ and xmas party for each branch and they were epic.
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Old 02-01-2014, 08:42 PM   #8
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Re: What Is Your Bonus Plan For Staff Performance?


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Originally Posted by AndyWRS View Post
We get a small bonus at xmas, under $300 per person.

Most of us have been with the company 10+yrs. When things are good we get some perks, but it hasn't been great the last few years and I think we are all just happy to be working. Those that enjoy there line of work stick around, most of us worked together at calpac, and just moved to a different company when calpac closed...I have known most of our employees for 15-25 years at this point. I used to work for a much larger roofing company from 85-96 (CalPac), they did have a bonus system in place for each month and did provide a huge summer BBQ and xmas party for each branch and they were epic.
But they closed. Perhaps had they kept the profit in the company they would still have the doors open?
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Old 02-01-2014, 09:49 PM   #9
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Re: What Is Your Bonus Plan For Staff Performance?


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But they closed. Perhaps had they kept the profit in the company they would still have the doors open?
Actually they were purchased by AHI in NZ who was producing Decra tiles back then. Decra tiles used to all be imported to the states from NZ, now they make them in Corona, CA. Upon being sold, the original Cal Pac closed its doors and many of the old Cal Pac'ers open up their own companies and used the Cal Pac name. If I recall, those that did so got an exclusive for a particular area / city. They use to be one large roofing company and now they are independently owned and operated.
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Old 02-01-2014, 11:11 PM   #10
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Re: What Is Your Bonus Plan For Staff Performance?


Nothing like Stephen. I think that is awesome, especially for his hands, but I would not do the same.

Decent Christmas bonus, at least by my standards. Even in the lean years when we (owners) couldnt afford a bonus for ourselves. Couple partys thoughout the year usually, buy lunch at least once a month.
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Old 02-01-2014, 11:13 PM   #11
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Re: What Is Your Bonus Plan For Staff Performance?


Same as Jaws, I'll buy lunch weekly and coffee regularly.
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Old 02-02-2014, 12:36 AM   #12
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Re: What Is Your Bonus Plan For Staff Performance?


Quote:
Originally Posted by pcplumber View Post
I don't believe in giving bonuses.

I believe in paying an employee exactly what I think they are worth at the time they do the work.

If I pay the employee a fair wage for his work I see no reason to dangle a carrot in front of his face to try to get a little more work or loyalty.

I keep only top producing employees and bonuses would not get me better quality work nor would bonuses get more loyal employees.

Bonuses do not make employees stay longer because I don't pay bonuses and I never had an employee quit due to the amount of money he made and virtually never had an employee quit for any reason with the exception of health issues, or they changed their type of career.

I believe that every payday the employee and I are 100% even. If my employee wants to show up for work the following day that is his choice and it is not because he has a future bonus coming.

Bonuses cause several problems and they can be unfair to many employees for many reasons. You could end up paying a bonus to employees who deserve them well and to keep the peace you will have to pay equal bonuses to employees who don't deserve them, or you will end up with discrimination problems.

When you mention the word 'bonus' your employees expect a bonus whether you make a profit or not because employees don't want to look at your books and they don't want to hear about your problems. When you offer bonuses it is impossible to get more work or more loyalty from your top producers and most loyal employees because they are already on the top of their game. The poor workers and less loyal employees will not work harder just because you offer the bonus and you will have to pay them to be fair. So, where is the gain?

So, I believe it is better to pay an employee for what he does and don't create problems by trying to make your employees work harder by dangling a carrot in their face.
I agree 100%, leave it on their checks on Friday. Pay a man what they are worth to you. A man giving 100% cant do better for the bonus, and who am I to save it up and pay it out as a bonus like its my gift to him. If he is worth it, I owe it to him every time I sign his check and shake his hand. I was raised where you pay your debts in person, thanking them for what they have done for you. The only bonus my guys get is when a client pays a bonus, and it is 100% passed on to them, with the knowledge its from client. I have never lost an employee to a better paying job. Their skills are recognized and compensated for.
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Old 02-02-2014, 06:30 AM   #13
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Re: What Is Your Bonus Plan For Staff Performance?


Quote:
Originally Posted by plazaman View Post
are you hiring ?
well-as a matter of fact..........

Currently we have 3 workers-all have some college,2 are college graduates

We need to add a 4th worker, if not mid year this year than almost certainly at the start of production in 2015. the limiting factor is time to train and suitable projects to train on. what we do is pretty specialized and I can't really hire an experienced person and adapt them to our way of doing things.

when we did primarily asphalt shingles there was plenty of grunt work on site for a new ,un-trained guy and it was also easy to hire guys who could slap and tack strip shingles. the work we do now requires something else

BTW- I appreciate the folks who have the opinion that the bonus money should be incorporated into the wage through out the year.

however- I think that would hurt me in the long run-and it would definitely hurt the employees almost imediately.

Keep in mine that our employees are paid above the going rate in this area. It is already impossible for them to leave and go somewhere and earn the WAGES they are already earning here. Let's say we INCREASE their wages from that point to reflect the bonus thaey MIGHT get at the end of the year----say 40%????

what that does is remove all flexibility from my ability to react to market conditions.

If work slows down a bit- I would be locked into those higher wages- you can't retract that without firing a guy and replacing him with a lower paid guy----------impossible, not going to happen here.

but- , the way I do it with the bonus system- I have some options.

If I choose, I could reduce my pricing some to be more competitive, still pay employees their current wages- but the money for bonuses would basically evaporate-at the end of the year the employees STILL would have had a good work year,making more than they could have elsewhere- there just wouldn't be any bonuses coming( or at best a severely lightened bonuses)- I like that better than firing someone

or
We can branch into other areas we are competent at- but not as profitable/Efficient

If our target crew hour production earning is X, and that is what we need to generate to produce the bonuses---------during a slow-down I can still take on work at say 2/3 X and keep everyone employed at things we don't usually do, or would rather not do.

However- if the amped up wage rate meant we NEEDED to generate X in order to keep the wages there- during a slow down I would need to Fire the guys and close up shop------ which is what a lot of people did back in around 2008 or so-remember?

I LIKE paying bonuses- it means we are doing well. It means we have the money to hire in-experienced guys, train them, pay steady raises, develope skills , and it means we have the ability to move the top guy into more of a management role- it means all of the guys have knowledge of the business workings inside and out- they are party to the decision making process.

BTW- I didn't invent this system-and it has taken me quite a while to get to the point where I could implement it- but other companies have been doing it for MANY years

some of you, for example may own welders produced by Lincoln Electric?-similar situation in play there for YEARS. On a really good year the employees may get bonuses approaching or exceeding their annual wages--and that extends down to the shop floor-EVERYBODY participates- not just a couple of guys at the top of the management pyramid.

Best wishes all,
stephen
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Old 02-02-2014, 08:12 AM   #14
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Re: What Is Your Bonus Plan For Staff Performance?


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Originally Posted by PoleBarnsNY View Post
How do you reward your staff for production?
I reward them by letting them take the day off early.

Sometimes I allow them to get paid for a full day if they accomplish a certain amount of work or complete a particular part of the project.

Other times if we work late, I'll get a pizza delivered and/or I'll allow everyone to take off a half a day the following morning.
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Old 02-08-2014, 01:48 AM   #15
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Re: What Is Your Bonus Plan For Staff Performance?


Stephen, if your paying above market, why have unbelievable bonuses? What does it improve for the company or you? Just curious.

Personally, I am not about splitting profits I earned through initiative.
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Old 02-08-2014, 01:58 AM   #16
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Re: What Is Your Bonus Plan For Staff Performance?


My dad use to tell me "your pay checks thanks enough" but he was a hardass. The guys nicknamed him killer. But he was well respected and payed very well. There were times he probably had 200 guys on at once. With a force like that you can't be perceived as too soft. Dont get me wrong he wasn't an asshole just a hardass. He is now 90 and a very proud man. Still has that hardass in him a little bit. He has a huge heart and I think he doesn't want it to be found out. That's how some of the old timers were back then. I wouldn't have him any other way!
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Old 02-08-2014, 07:39 AM   #17
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Re: What Is Your Bonus Plan For Staff Performance?


Quote:
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Stephen, if your paying above market, why have unbelievable bonuses? What does it improve for the company or you? Just curious.

Personally, I am not about splitting profits I earned through initiative.
Jaws,
that's a fair question-and to answer it fully would require a looooong essay or a short book. I will try to come up with a shorter version.

I didn't always think this way. I remember a conversation I had on the old Fine Homebuilding Forum maybe 10 years ago. Basically my position at that time was " Hey- if you are not happy with the pay scale here in MY company ,I completely understand. What you should do is go out on your own and start YOUR own company"

Now,- even 10 years ago I wasn't happy with that line of thought-and I was beginning to question my attitude about that. I credit a guy named Mike Smith on that forum for nudging my thing along. At the time I wasn't in a position to do anything about it as a practical matter

Basically it is a matter of what kind of a person do I want to be-and what kind of a person do I want to surround myself with? What Caliber of individual do I want to associate with 10 hours a day?

Even today- if you go into the carpentry forum on this web site there is a thread about" what wage can a finish carpenter earn?"
Basically the pay rates are about the same as people were talking about on the Fine Homebuilding forum back in 1997 when I first went on line.

And-at almost anytime on this forum---somewhere--- there will be a discussion about why don't tradesmen get more respect in society? why don't they get paid more? where are the Apprentice programs?
why can't we hire good employees? why does an employee leave and start his own gig as soon as he learns enough to get his head out of his own azz? why?,why? why?

AND- many of the potential employees want to be able to come to work wearing a ripped ,smelly tshirt sporting the logo " I raped your mother last night", smoke on the job site,swear on the job site and display their ink, their piercings, leave early friday and blow off monday.

Many-not all----but many.

Now- how did all of this come about? Primarily I think it is because in the USA- if a kid has an IQ above 90 or so, from the minute he enters kindergarten he is told by his PARENTS and his Teachers " Go to school, go to college, you need a college education to get a good job"

Today the caliber of individuals who made excellent tradesmen in my fathers day and my grandfathers day- largely go to college. When they graduate- there often isn't a job available for them in their college major- but that potential to be a good tradesmen is still there. Problem is------- the trades have been bad mouthed by their parents and teachers since the guy was 6 years old.

How eager should that guy be- to start a career where he will start out digging post holes for MAYBE $11/hour and probably top out at $16-$17 /hour-and be lucky indeed to make $20/hour? with no medical benefits, no vacation pay, no retirement, no pension,no 401k etc.?

Even if he DOES learn his trade-------- his choices are largely to either work his career at a hand to mouth existence-- or start his own gig and probably fail. Statistically ,you know this is true.

Now- if we return to your original question- it comes down to " what's in it for ME?

what's in it for me is: I get to hire high caliber individuals. Fit young men. Smart young men. Proven learners. Proven hard workers. Men from good background who reflect well upon the company. Men who can operate individually after training. Men who can handle themselves and don't need babysitting. Men who have the ability to go to the customers house, perform the scheduled work---and educate the customer about future work that will need to be done. Men who keep their eyes open for new markets or product lines for our company. Men with the education to do good research and write detailed reports. Men who can find left hand rake trim for a Ludowici French tile roof in Brookville green( not the separate rake trim- the rake trim that was molded as part of the field tile). Men who have interests besides NASCAR or getting stoned on Friday night. Men who get married. Men who raise their own children. Men who buy houses. Men who STOP me from hiring potential employees that they think will not work out..... and on and on and on.

Yesterday my wife ran into one of our guys---- he was so proud to tell her that his credit rating is something like 762 and he has qualified for a mortgage on a house he and his wife are looking looking at ( in a superb school district.) His wife is in Grad. School ( they married in sept. 2012)

one of my other guys is getting married in oct. 2014.
you asked what is in it for ME?
THAT is what's in it for me.

I am 51, I reached the point back around 2010 where I could retire if I wanted to- not "south of france" retire- but basically retire. what would I do then?-so I might as well keep working, keep earning, keep growing and help the guys around me be have better lives.

I have enough. I don't need a beach house- I can rent one if I want a vacation. I would rather see my guys living in good neighborhoods and their kids going to excellent schools

that is what is in it for me.

sorry to write so much- but that is about the shortest I could make it.

Best wishes all,
stephen

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