Auto Service World
News   June 20, 2023   by Adam Malik

Why performance pay is better for your shop

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A shop coach gave this example: You have two technicians in your shop. In an eight-hour day, one puts out six hours of work; the other does 10. They’re both paid the same. What do you think will eventually happen?

Bill Haas, president and Owner of Haas Performance Consulting, understands that you want to treat everyone the same. But that’s not realistic and will only lead to anger and tension on the shop floor.

“What happens when you treat your worst employee just like your best employee? The best employee gets pissed off,” he said during the seminar Shop Production and Payroll Drives Profits at the recent Midwest Auto Care Alliance Vision Hi-Tech Training and Expo.

“And then what happens to the culture in my business? I got infighting and frustration and anxiety and people are upset. They don’t want to work together. They don’t want to help one another. It’s a recipe for disaster. So they’re not all the same. They’re all different.”

They have different skills, different levels of experience and different abilities. As the shop owner, you need to look at production — the amount of work completed in a set amount of time.

And if you think going to the underperforming employee, reading them the Riot Act and telling them that they need to perform better so the shop can make more money is going to change anything, you’re wrong. They’re going to see that they’re going to get paid the same if they put out more work. So why bother?

“He’s not motivated. So now you have to show him or her how they have the ability of improving their lives by having this happen,” Haas said. “And that’s where a performance-based paid plan comes into play.”

Then you have happy people working for you. When they’re happy, they’re doing more work. When they’re doing more work, you can serve more customers. They don’t have to wait as long to get their cars back, either.

“Because you’re focused on production, you’re getting cars in and you’re getting cars out,” Haas explained. “And your customers love the fact that you’re getting the car out because where do customers want their cars? At home in the garage and driveway. They don’t want them at the repair shop.”

Everybody wins; there are no losers, he added. “So why would I not do it? What’s the struggle?”

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3 Comments » for Why performance pay is better for your shop
  1. Ahmed says:

    What about when that 6 hour tech is skilled and trained in electric vehicle diagnostics and repairs and that 10 hour tech is a brakes and flushes guy?

  2. SG says:

    Or what happens when the 6 hour guys gets all the brakes and flushes and the 10 hour guy gets all the electric vehicle diagnostics. Will they not fight over why he gets this job and that guy gets that job? They will always be looking over at the jobs the other guy is getting with envy. Sounds like tension in shop either way. Using money to encourage more work also may tend to make a person cut corners, and may increase comebacks. Humans want to contribute and be a part of society/family naturally, we are social creatures. And how do we do that? by helping each other. We are not naturally driven by punishments and rewards. So, how to motivate, without punishment and rewards?

  3. Joe says:

    Very good point, where I work there is one guy who crushes hours but mostly does safety’s and brakes and of course get paid the best hour rate.

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