Is it paid vacation?

[J-Ri]

An auto repair shop pays its technicians $8/hour plus $25/hour commission, and takes the first $1,000 of this every month to cover shop expenses. This shop has a labor rate of $72/hour, and the typical markup on parts (between 50-100%). This company gives its technicians paid vacation. While on vacation, technicians make $8/hour with no commission pay, and the full $1,000 is taken for the month.

As an example (using a 4 week month to keep it simple): A technician is there for 40 hours each week and makes $8 per hour for that time, making $1,280 (8x40x4). In this month, he averages 32 hours per week working on cars and makes $2,200 (25x32x4-1,000). The total in this month is $3,480. If this employee takes 5 days vacation, he makes (8*40*4) +(25*32*3-1000)= $2,680, which is $800 less than if he had not taken time off.

The owner of this company believes vacation is paid. The technician is not there to work on cars and cannot make anything on commission. The shop still has the same expenses while the technician is gone, so $1,000 is taken off of the commission pay for the month. But technicians are still paid $8/hour out of the company's money while they are on vacation.

Some technicians at this company believe vacation is not paid. Every month, $1,000 is taken from their pay and paid back as $320 per week, for a total of $70 more each week than what was taken. So while on a week of vacation, the technicians make $70, which is the equivalent of $1.75 per hour.

So the question is, does this company give its technicians paid vacation?

[MagicRat]

In this case, I would say vacations are partially paid. Many people have mixed salary-and -commission incomes. If one receives only the salary portion and not the commission payment, one is only receiving partial payment, regardless of what the boss says.

Commission exist obviously to reward specific workplace behaviour. For example, a commission on sales encourages employees to actually sell stuff. In this case, the boss is encouraging people not to take vacations.

EDIT: I gave this a bit more thought, and the boss is not being terribly honest here. Commissions, by their nature, are variable and are typically expressed as a portion of something that's sold. Therefore, $25/hr by definition cannot be a commission. It is simply a salary. The boss is simply re-naming it, possibly for a tax advantage on his own books, but also, I suspect, to mislead the employees on this issue

http://en.wikipedia.org/wiki/Commiss...emuneration%29

[J-Ri]

Originally Posted by MagicRat

In this case, I would say vacations are partially paid. Many people have mixed salary-and -commission incomes. If one receives only the salary portion and not the commission payment, one is only receiving partial payment, regardless of what the boss says.

Commission exist obviously to reward specific workplace behaviour. For example, a commission on sales encourages employees to actually sell stuff. In this case, the boss is encouraging people not to take vacations.

EDIT: I gave this a bit more thought, and the boss is not being terribly honest here. Commissions, by their nature, are variable and are typically expressed as a portion of something that's sold. Therefore, $25/hr by definition cannot be a commission. It is simply a salary. The boss is simply re-naming it, possibly for a tax advantage on his own books, but also, I suspect, to mislead the employees on this issue

http://en.wikipedia.org/wiki/Commiss...emuneration%29

My thoughts exactly, except I do believe the $25 an hour is commission. It is a portion of the labor that's sold, $25 dollars to the technician from the $72 paid by the customer is 34.72% commission. I also agree that vacation is partially paid, however, at the actual pay of $1.75 an hour, I would almost rather have no pay than for them to call me an idiot by trying to say that I make $8 an hour.

I've been saying "owner", but it is actually the owner's son; who was made general manager, despite having absolutely no skills or the experience needed to be successful in that position. I have nothing against the actual owner, other than letting his son run the business. He always treated everyone well, I'd probably still work there if the owner wasn't 99% retired. Employees are either paid this way is to mislead, because the general manager is a complete idiot, or more likely, both. When I discussed this with him, he seemed to genuinely not understand what I was saying. He also didn't understand why I was upset that they were shorting my "commission", if we call it that, by 10-20%


Anyone else have anything to say? I posted this to satisfy my own curiosity, but I'm thinking about sending a link to this page to my former boss, especially if some more people agree with me. Some of the technicians there and I became friends, so it would be nice if I could get them fair pay, especially if it means getting rid of some of the dead weight in the office to do so.

[MagicRat]

Okay, I see the commission rate.

If its paid as a portion of the book rate and not the actual time you work on the car, then I agree its a commission. For example, you do a 5 hour job in 3 hours.... you should get paid the 5 hour commission. If you only get 3 hours, then it looks like a salary, imho.

[00accord44]

I do agree that the "commission" at play here is unorthodox but I can see how it applies to the particular job. No cars = no commission for anybody

If this were a sales position I would say there should be no compensation for missed commission since the employee is not there to utilize their skills at drawing money out of potential customers. However, for a shop position, the demand is not dependent on the employee. Rather, the employee is dependent on the demand, and if they are not skilled enough to keep up then they will be terminated.

In my opinion, a hybrid system like that should have a hybrid PTO system as well. The fact that you are paid hourly makes it difficult. A staff of 10 Full Time salaried employees could easily have the total commission for the week divided between them equally. However, if some work more hours than others, then the distribution needs to be weighted relative to the hours claimed for PTO against the total shop hours worked during the week. Not sure if how I worded that made complete sense....

[J-Ri]

Originally Posted by 00accord44

In my opinion, a hybrid system like that should have a hybrid PTO system as well. The fact that you are paid hourly makes it difficult. A staff of 10 Full Time salaried employees could easily have the total commission for the week divided between them equally. However, if some work more hours than others, then the distribution needs to be weighted relative to the hours claimed for PTO against the total shop hours worked during the week. Not sure if how I worded that made complete sense....

Nope, not "are paid", "were paid" I had enough of that crooked idiot. I told him several times we needed to be paid a percentage of our average commission pay while on vacation. He couldn't understand how I figured that we made $1.75 an hour while on vacation when the check stub said $8/hr, and I think percents are way over his head.


What happened to the stress release forum?!?! Did the demand for it die down since I left? There's a lot more I want to say, but it says I "can't be mad or angry in this forum"

[00accord44]

I think the Stress Release and most of the other Off Topic forums were all rolled up into general COT since we seemed to have more sub-forums than we had regular posters. The AF lifers are still here and still routinely pissed off.... we just tone down our rage into quiet contempt.

[gmtech1]

Not sure if this will help or not, but my 2 cents are here. I do not recieve any "hourly" rate. I get a commision "x" amount of the shop labor rate per hour. (Example: 30.00hr of a 100.00hr labor rate) on a flat rate pay system. No cars in shop? No money made. For our vacation pay, they take what you earned over the previous year, divide it by 52 weeks, and that is what your vacation pay is. Pretty simple. Maybe an Idea for the place you are refering to?

[J-Ri]

I agree, that would be an excellent way to do it. I had suggested something similar several times while I worked there. Unfortunately, the general manager has his head so far up his ass that he can't hear anyone that isn't kissing his ass.


Oh well, his loss... I was the number 2 tech there, but only the number 1 tech knew it . As far as everyone in the office was concerned, there were two levels of technicians: The #1 tech, and everyone else.

I started my own shop, and when I'm able to hire them, I think most of the good technicians will come work for me. Nobody said they would, but I have mutual respect with every technician there, and I think they all hate it there as much as I did. There's nothing as satisfying as leaving a once great business that's being run into the ground by second-generation incompetent management to start my own business, where I'm already doing better than I was there.

[MagicRat]

Originally Posted by gmtech1

Not sure if this will help or not, but my 2 cents are here. I do not recieve any "hourly" rate. I get a commision "x" amount of the shop labor rate per hour. (Example: 30.00hr of a 100.00hr labor rate) on a flat rate pay system. No cars in shop? No money made. For our vacation pay, they take what you earned over the previous year, divide it by 52 weeks, and that is what your vacation pay is. Pretty simple. Maybe an Idea for the place you are refering to?

Back in my GM mechanic days, our shop used this system, as did many others. Around here it was the 'flat-rate' system and there was much debate about whether it resulted in a more expensive, lower quality work from the customers point of view.

[fredjacksonsan]

In this case, you're effectively paying the company to be on vacation. If the $1000 per month is for shop supplies, your analysis is correct that since you are on vacation, you aren't using shop supplies. At the very least, the shop supply fee should be prorated.