Pay possibilities

Sure, you turn wrenches for a living, but how is your work measured? How does your boss know how much to give you at the end of the day?
In Canada there are two main ways that technicians get paid – flat rate or hourly rate – and there are fans and detractors of both systems.

In a very busy shop, a flat-rate system might make sense for technicians. Certain jobs should require only a certain amount of time and it’s the technician’s responsibility to do his or her work properly and on time.

Most service departments at dealerships use the flat-rate system in place – although the rationale for that isn’t necessarily top-of-mind.

Gino Pennino, the service manager of Raceway Chrysler Dodge Jeep in Toronto, says the flat-rate system has been in place since he started working there 15 years ago. "This is the way it always has been," he said.

The sentiment is echoed by Scott Fraser, service manager at Fraser Ford in Oshawa, ON. Asked why it’s preferred, he said, "I’ve never really thought about it, that’s the way it was always done."
But Gary Gorman, owner of Autobugs Tech Services in Lawrencetown, NS, is no fan of the system. He used to work in a shop that used the flat-rate system and says its biggest drawback is in shops where you can’t stay busy enough to make it pay.

"If you’re in a shop that’s not so busy, flat rate doesn’t work too well," he says. "There’s no back-up policy to cover you and there are no minimums. In a some cases, some of the shops will have a minimum that they will cover you for at least 20 hours a week. There"s usually that much work coming through the doors so they don’t have to worry about it."

Timothy Martin, owner of Martin Automotive in Moncton, NB, also used to work in a flat-rate shop. "A straight hourly system is better. You do your job and you get paid for what you do," he says. "I’m running my own company now and I would never go and do that [have a flat rate system] to the employees that I hire. Have an hourly rate and you keep the employees happy."

Rudy Cordoviz, of 3C Auto Clinic in Winnipeg, MB, jokingly says if he were to implement the flat-rate system in his shop there would be dire consequences. "They’d be starving if we had a flat rate. If the technician does a three-hour job in six hours he’s not going to make any money."

He also has deep reservations about the quality of work performed in flat-rate shops. "If the guy’s on flat rate, he’s rushing the job," says Cordoviz. "He wants to get into the next job. He wants to put in his eight to 12 hours instead of three hours."

Most independent auto service shops pay their technicians using an hourly fee.

Tony Suberlak, owner of A&M Auto Centre in North Battleford, SK, says, "Most guys don’t like flat rate, because in slow times they wouldn’t make any money." His shop had a flat-rate system in place about 20 years ago, but the hourly system has proven better for the technicians.

"We try not be slow," says Suberlak, "but it does happen so we have to bite the bullet."

At Precision Auto Clinic in Moncton, NB, the technicians on staff are sold on the hourly system. Manager Gary Lovelock says the hourly system is fair for everybody. "We talked about it [moving to a different wage model]. The boys aren’t interested in it. They prefer the hourly wage."

For some owner/operators neither the fixed rate nor hourly rate system works. Peter Warren, one of the owners of Multi-Tech Automotive in Hatchet Lake, NS, says, "There are two technicians in the shop – my partner and me. As partners we both draw a salary."
That’s possibly the simplest pay model of all, but not one that most technicians will enjoy until they get into management.