As sales trainers and business consultants, paying commissions is one of our first suggestions when discussing pay structure. Paying commissions is a very natural way to keep plumbers and HVAC technicians focused on production. Techs are naturally motivated by commission-based pay.
The challenge with a commissioned-based pay structure is how to maintain ethical behavior among your technicians. Read on to learn how to keep your employees motivated to hold themselves accountable as they work to earn their commissions.
Ethics and Commission-Based Techs
There are different ways to hold your employees accountable as they go out on-site to complete service calls. Here are four ways to maintain ethics with your commission-based technicians.
1. Hire Compatible Personalities
Not every technician is going to work well in a performance-based pay system, and that’s just fine. Some techs perform best when they’re getting paid a flat per-hour fee. However, straight hourly pay is not ideal for most residential-based service companies. Performance pay is best for these types of companies.
Performance pay means technicians are keeping a certain percentage of the money they bring in. Even if you don’t pay “straight commission”, you can be performance-based on pay. Also, bonuses and hourly wages that adjust by performance are types of performance-based pay systems. If your company has this type of pay system, you’re going to want to hire techs who like working this way.
I have found the best method to determine whether a plumber or HVAC Tech will be successful working in a commissioned-based pay system. First, if they’ve had success in similar systems in the past, they’ll most likely succeed again. The second method is through the DISC Advanced Profile. When I help with pre-employment screenings, I look for the following:
- A proper balance of the “Driver, Influence, Stable and Compliant” personality
- A high values and motivation score under the “Economic, Political” categories
- A strong indication score of “Empathy, Ethics and Goal Orientation” in the external and internal dimensions score
When it comes to your business, you cannot succeed without motivated employees. Make sure you’re hiring individuals who are inspired by a performance-based pay system.
2. Provide An On-Ramp Pay Structure For New Hires
An on-ramp training period is a time frame during which you pay a fair “training wage.” This allows your plumber or HVAC tech the time needed to learn your system. Here is a good 90-day guideline for an on-ramp training period:
- The first 30 days:
- In the truck with your top producer
- Meet every morning to go over standards
- The next 30 days:
- They’re in their own truck
- The manager performs at least 2 ride-alongs per week
- Meet daily to discuss any challenges
- Train on standards weekly
- The last 30 days:
- Meet weekly to discuss challenges
- Train on standards weekly
- Send away to training if their performance is on track
Practicing this on-ramp training period sets your employees up for success and makes your company’s expectations clear.
3. Establish A Clear Code Of Ethics
A code of ethics creates a clear boundary. Oftentimes, just establishing the importance of your standards is enough to keep the standard high. However, there is no substitute for putting your standards in writing and having them signed.
In addition to having your standards in writing, you need to also “inspect what you expect.” This means performing ride-alongs, “happy calls” a.k.a. client debriefs and having strong accounting standards are a must.
4. Charge Enough To Pay Well
It’s your responsibility to charge enough to support your business. If you want highly-motivated, ethical employees, then you’re going to have to be priced properly. Not charging enough money forces your HVAC tech or plumber to accept less pay than what they’re worth.
If the pay becomes too low, then they’re left with a few choices: either quit and go to work somewhere where the company charges more or violate their personal code of ethics. The type of team member you’re looking for would actually quit before they violated their ethics. Or, they would never come on board because they couldn’t see themselves earning a great living with your company.
Long-Lasting Ethical Standards
When you want to build a dependable, honorable team of technicians for your company, you need to establish a clear code of ethics. Beyond that, hold your employees accountable and pay them a living wage.
To learn more about what it takes to run an ethical company and keep your employees working hard for the long term, you need Service Excellence. Sign up to attend one of our PRESS PLAY events today! At Service Excellence, we IGNITE THE POWER WITHIN!
