Contractor Talk - Professional Construction and Remodeling Forum banner
1 - 5 of 5 Posts

·
Mark
Joined
·
252 Posts
Discussion Starter · #1 ·
We have a family owned boat dock construction company. In May of this year I started a separate LLC installing boat lifts on lakes other than the one we service with the construction company. I have one employee.

We have shown profits every month since May. To be conservative I started my employee out with a low weekly salary higher that was more than he was making on unemployment. He was laid off when we began discussing this new company.

We have managed to pay off the 15k it took to get started and I have not paid myself a dime. I work full-time in the family construction company.

I supply him with a vehicle to take home and a cell phone he can use for personal and business. I would like to keep the low weekly salary as a base and pay him monthly based on how profitable we have been. I am hoping this will encourage him to be mindful of his time and material used.

I am not contributing to a retirement plan with him currently and I do not pay for medical.

Have any of you done this? What percentages have you paid out? How has it worked for you?
 

·
Banned
Joined
·
306 Posts
Just give him a bonus when your in the mood... which should be rarely...

I wouldn't make it a formal arrangement, once you start, You won't be able to take it away, without seriously upsetting your employee.

Same thing with a Holiday bonus. Once you give one, every year, your going to be pressured to meet or beat last years. Give a small bonus at the Holidays, and any other bonuses should come as a complete surprise, and only when your completely sober.
 

·
Nest Home Improvement
Joined
·
890 Posts
I think bonuses are great as rewards and to keep good staff with you longer. It just needs to be clear that the level of bonus (or lack there of) is dependent upon the top performance of individual and profitability of the company as a whole.
 

·
Registered
Joined
·
1,379 Posts
We do something similar. For instance;
My M&L costs are ..% of my income. If I want to lower them say 5%, I give my project manager full reign and a % of what he saves. Some companies give perfomance incentives based on production etc. The point don;t give him something for nothiong. Make him earn it and he'll work harder for you
 

·
Registered
Joined
·
595 Posts
My project manager is on salary and has graduated from the bags. His bonuses come bi-annually and represent 5% profit sharing of our net for that 6 months. We calculate our O/H projections for the year and we base his profit sharing off of our overhead, job costs, etc. I keep him very involved in the how the business is on track or off track or where and when adjustments are necessary via the Michael Stone method. I was pleasantly surprised to see how often he bags up or handles things on his own without sending out a crew to keep costs down and his part up.
 
1 - 5 of 5 Posts
Top