The No. 2 story from Truck Parts & Service looked at the varying types of pay plans for service technicians; primarily a flat-rate system and an hourly system.
According to Mark Martincic at KEA Advisors, a heavy-duty consulting group, the flat-rate system is a positive influence on technicians because it motivates them to complete work in the time billed on repair invoices.
“The [flat-rate] system is a great way to increase productivity,” he says, “because it allows a service provider to equalize the labor it bills with the labor its technicians provide.”
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Katie Hopkins, executive vice president at Truck Centers, Inc., says her company has been using a flat-rate system to pay its technicians since the 1980s, citing benefits that speak for themselves.
“I think it motivates [the technicians] to do their work as quickly and effectively as possible,” she says. “It allows them to create their own destiny.”
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The hourly system is the most common payment plan in the heavy-duty industry. The system works by compensating technicians a certain wage per hour for the work they perform.
“It does allow [them] to manage repairs efficiently because it keeps technicians working on a repair until it’s completed,” he says. But Martincic says an efficient shop isn’t always the result of efficient technicians.
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