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S2 E70 - This Contractor Pay System Added 14% More Productivity
In this episode of Beers with Contractors, Will discusses how contractors should navigate employee raise requests by benchmarking wages to local market data and using performance pay to tie higher earnings to measurable results. He clarifies performance pay versus historical piece-rate pay, referencing the Fair Wages Act (1938) and compliance risks around minimum wage, overtime, and worker classification (W-2 vs 1099). He outlines three incentive types—spiffs, KPI-driven bonuses, and labor-driven performance pay tied to budgeted labor hours or labor percentage—and stresses understanding job costing, cost of goods sold, and gross profit margin before launching any plan. He notes reported outcomes of properly implemented performance pay, including higher productivity and lower labor percentage, and warns about Department of Labor “non-discretionary” bonus rules requiring adjusted/weighted overtime and proper accrual on multi-week projects.
00:00 Introduction
01:09 Handling Raise Requests
02:51 Market Pay Research
05:57 Performance Pay Basics
06:46 Piece Rate History
09:16 Compliance and 1099 Risks
13:47 Build a Pay Plan
15:32 Productivity Gains Numbers
17:17 Three Incentive Types
19:11 Labor Driven Pay Models
22:06 P&L and Transparency
27:55 Sales Pay Compliance
30:30 Call Center Incentives
31:53 Manager Bonus Structures
33:29 Keep Bonuses Simple
34:55 When Not to Launch
36:33 Non Discretionary Overtime
38:55 Weighted Overtime Accrual
42:47 Recap and Next Steps
45:25 Outro and Disclaimers
My calendar link: https://per4mance.io/meetings/will723/qa-with-will-blake
Link to the non-discretionary rule based on the Department of Labor article:
https://www.dol.gov/agencies/whd/fact-sheets/56c-bonuses
Check Out Greenbaum Stiers Strategic Marketing Group: https://www.greenbaumstiers.com
Foundation Rescue Supply Link:
https://www.foundationrescuesupply.com/
Contractors Kick Ass!
Podcast Store Link:
https://williamwalkerblake.com/store-1
The Worker Incentive Program that Contractors Love! - Per4mance Software https://per4mance.io - Pay for performance, not hours
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By Beers with Contractors
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In this episode of Beers with Contractors, Will discusses how contractors should navigate employee raise requests by benchmarking wages to local market data and using performance pay to tie higher earnings to measurable results. He clarifies performance pay versus historical piece-rate pay, referencing the Fair Wages Act (1938) and compliance risks around minimum wage, overtime, and worker classification (W-2 vs 1099). He outlines three incentive types—spiffs, KPI-driven bonuses, and labor-driven performance pay tied to budgeted labor hours or labor percentage—and stresses understanding job costing, cost of goods sold, and gross profit margin before launching any plan. He notes reported outcomes of properly implemented performance pay, including higher productivity and lower labor percentage, and warns about Department of Labor “non-discretionary” bonus rules requiring adjusted/weighted overtime and proper accrual on multi-week projects.
00:00 Introduction
01:09 Handling Raise Requests
02:51 Market Pay Research
05:57 Performance Pay Basics
06:46 Piece Rate History
09:16 Compliance and 1099 Risks
13:47 Build a Pay Plan
15:32 Productivity Gains Numbers
17:17 Three Incentive Types
19:11 Labor Driven Pay Models
22:06 P&L and Transparency
27:55 Sales Pay Compliance
30:30 Call Center Incentives
31:53 Manager Bonus Structures
33:29 Keep Bonuses Simple
34:55 When Not to Launch
36:33 Non Discretionary Overtime
38:55 Weighted Overtime Accrual
42:47 Recap and Next Steps
45:25 Outro and Disclaimers
My calendar link: https://per4mance.io/meetings/will723/qa-with-will-blake
Link to the non-discretionary rule based on the Department of Labor article:
https://www.dol.gov/agencies/whd/fact-sheets/56c-bonuses
Check Out Greenbaum Stiers Strategic Marketing Group: https://www.greenbaumstiers.com
Foundation Rescue Supply Link:
https://www.foundationrescuesupply.com/
Contractors Kick Ass!
Podcast Store Link:
https://williamwalkerblake.com/store-1
The Worker Incentive Program that Contractors Love! - Per4mance Software https://per4mance.io - Pay for performance, not hours
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