What to pay a qualified restoration employee

I've been looking to add another experienced (5-10 year) employee to my shop and have been fighting back and forth for over a year with the office staff what to pay someone in that position. I know of course what I make (which I believe is an undervalued amount) and just am curious as to what some other shop owners may pay employees with those qualifications. I've been doing this for 12 years. If you don't fell comfortable posting, please pm me.

Thanks!

 

This sounds pretty fishy to me. Your shop and you don'y know what to pay someone ? And the fighting part is strange too......

 

I think it depends on the employees skills and qualifications. I also believe if you are a good business owner and value the relationship you have with your employees, you should agree on a pay rate between the two of you.

 

The office staff (brother and father) looks at it like an average body shop and how the local shops pay not as a specialized trade. Fighting is not really the correct word. My father is a retired school teacher and my brother is a business major graduate (2001). I'm the only one really connected to this trade.

 

Decide what your profit margin is or what you want it to be. Then pay your employee that much less than you can charge for what he or she is doing.

That's overly simplified but that is how it is done unless the employer is a total *** then they way underpay the employee and make a ton off of them.

here is the deal any employee is always paid less then they are worth because if they weren't the employer couldn't make any money off of them.

 

That makes sense. I guess I'm kind of looking to get some kind of average. I did some google searches and not much comes up for our business. I found one from 2009 that stated average was about $16.20 per hr. Of course that is a couples years old.

 

5-10years is still an apprentice imo, a master gets a percentage and often brings his own work. i would pair the apprentice with a master and the master would set the wage because it'll come out of the budget for that project.

 

We used a 2.8 to 3.2 multiplier to establish our billing rates in a non auto service business. You take the employee's wage plus fringe package and multiply it by 2.8 to 3.2 to develop a billing rate. Works the same way backwards. If you want to charge $75/hour for his time and you figure your multiplier at 3.0 then his wage plus benefit package needs to be $25/hour. The key to all this is what your overhead and operating expenses are and what kind of profit you should be realizing out of his work. 2.8 to 3.2 seem to satisfy almost everyone's business. For a body shop I'd segregate the materials as a separate line item outside the multiplier.

 

I used to pay my guys anywhere from $9 to $24 per hour depending on what they did, we built high end musclecars. It was good until he (my main guy) started taking side work out from my shop. Its a tough business. I did it for 20 years, still do but only part time now. I like working for someone else better I think. Its hard to find good help, even harder to trust people working for you.

 

I do not own a shop so I have no real experience running one but to me it depends on where your at and what are the prevailing rates.What I mean is where I live you can buy a very liveable house for under $20k,and the average shop here may pay $25k a year. Now in San fransico or Boston I would imagine a burger flipper would make more than that.I agree on the apprentice thing,I would think a percentage of a master and raise the percentage as they learn. Just my opinion.

 

Thank you for that info. At our labor rate and the 3.0 multiplier my per hour pay is spot on. We do keep our materials separate and charge them as they are used per customer.

 

Same damn thing happened to me! My main guy, who was getting paid an almost equal share of the labor was starting his own operation behind my back a few years ago right after I got diagnosed with cancer no less..
I been doing it a long time as well (or was, just finished a transplant) and I paid everyone in the shop on percentage. You don't make billable hours neither him or I gonna make anything. Work=pay, no work=no pay.....

 

"can't find good help" . I heard that same bull for 50 years.

Would any of you do skilled & talented restoration work for that little pay? Great way to live a ****ty paupers life in these times. Figure the cost of gas, heating, and a roof over your head, and maybe a single income family or single parent.

Get real.

 

Note that the OP is charging approx $48/hr (given that he says this pay reflects the 3.0 multiplier), so this is what he can afford. He has to charge more to pay more. I'm in a different industry (computer software) but we still charge by the hour and so we do the same calculations (plus our G&A is WAY more than his)

 

The problem isn't finding employees that will do work for that little. the PROBLEM is finding consistant non-broke-*** customers to get any work done to their cars. I listen to the rants all of the time on this and other boards about how much it costs to get a car restored. That is why most of you out there get your friends to do work for beer or end up doing it yourselves. It's hard to figure out an acceptable shop labor rate. No matter what you choose, you will always hear that you are too high on estimates. Factor in the payroll, rent, garage keepers insurance, shop tool costs, general shop and tool maintenience, state and local taxes, employee withholdings, waste disposal, fire supression, and countless other little checking account draining items, there is very little left for the shop owner to put in his pocket. You want to get a car restored...get a pro shop to do it. You want to loose your *** for 5-7 years...open a pro shop.....ask me how I know.....

 

$25.00 hr to start

 

What did you do? Just wake up and say I think I will go on the HAMB and find out what to pay my employee.l

 

50k a year.

 

50K a year for how much work? 40 hour work week or 70 hour work week?

You'll probably get a lot more production out of someone working on a percentage of your shop rate than you will on someone working a straight hourly wage.

I don't think 33% is gonna work unless your shop rate is $60.00 up.
Larry T

 

16 bucks an hour isn't going to get you a qualified resto guy. Unless the area has a really low cost of living. But it might be just enough to get you a good trainee.

 

Most service industry shops [plumber , elec. , hvac , etc. ] pay on billable hours [you get payed by what gets billed , then the 3 times factor is about right , but again , it depends on prevailing area practice .

dave

 

I sure am glad I don't do this for a living. It's no wonder some of the guys on here are crabby. $16.50 ouch.

 

I Couldnt have said it better

 

Hi ... Most of the resto or rod builders in Australia who work for a boss that I know are on $30 to $40 an hour...this is specialized work and usually multiskilled..shop hourly charges are from $80 to $125 per hr plus all consumables.......

 

I'd find your local Chamber or Economic Development folks and have them get you wage and cost of living numbers for your region. That detirmines a lot of it. When I moved from Tulsa, we had to pay upwards of $27.00/hr for our labor, here, we could start them at $11-13.00/hr.

 

We operated a professional tax practice and used the same formula.
First you must work out the employees "productive hours".Over here with a full time employee you have 4 weeks annual leave,10 days public holidays,8 days sick pay and maybe a couple of "comp***ionate days" and of course training or professional development days.

I worked on 44 weeks per year and say productive hours at 6 per day.
If you are paying an annual salary add employer costs like retirement fund(compulsory over here at 9% of gross wage) plus workcover etc etc.Then divide that by the annual productive hours and you have the hourly cost for that employee.

It doesn't take long to work out that the employee on $30,000 per annum is costing you at least $25 per hour just to turn up.The 3 times is based on one third employee wage,one third overheads and one third profit to owner.So $75 per hour for the $30,000 employee.If overheads are lower you may get away with a lower gross rate.

We then had a productivity target for each employee and time sheets to monitor that for "charge outs" to clients.The employee had an incentive that if they had better productivity they got a bonus and that was usually quite generous and paid at Xmas when extra cash is gratefully received.

 

Like I said that is one I found on a job website that is damn near three years old. I'm not saying that is what someone should be paid. In our area we have on of the higher non-dealership labor rates.

 

My last job as an *A* grade body man (body/paint/frame/mechanical/electrical/fabricator) I did basically everything as the shops number 1 man. My pay was $20 per hour pay rate plus a $10 per hour bonus for every hour I shaved off the total jobs quoted time. Kinda like flat rate with a $20 hour draw. I'm the type of person that looks at each job and delegate my time so as to use my time constructively. A lot of techs waste a lot of time on each job. This was back in 1994 before I left that shop and started my own used car shop. If you quote the job properly and hire good help, the job usually gets done quicker and better.

 

Yep exactly. There are not a lot of places where you have access to as many professional builders as on here. I'm just looking for advice and direction as to what is normal accepted practice. Obviously I do not of the advantage of years of experience running a shop that you must have.

 

We have tried to come up with an acceptable bonus system to both the owners (myself included) and the employees. It is fairly easy to do in a body shop with a basic flat rate but in restoration there is obviously no set time to beat or shave. Most of our ideas of either been too ***bersome or difficult to achieve to be effective.