Compensation plans

In some recent work I’ve done with repair shops my attention has been call to the importance of compensation plans. For a long time, I’d worked with shops who had some pretty impressive compensation plans – health insurance, life insurance, matched retirement savings, year-end bonus, etc. Recently though I’ve been asked to work with some shops who do not have well developed compensation plans. They also did not have a well-developed staff and experienced high levels of employee turnover. The U.S. job market today requires more than just a paycheck. Attracting and retaining quality employees requires much more than just a paycheck. Employees come to us with bills, families, and dreams. Work conditions, work schedules, benefits, and real money are all concerns of theirs. With some big players in our automotive service industry job market, even small shops have to have reasonable compensation plans if the hope is to have a sustainable business at any level. The next obvious question is “how to I build a compensation plan?”. Some shop owners take this challenge on themselves, while others leave it to their payroll company to advise them. If you have a payroll company (and you should) you probably have access to other human resources functions. They will be more in-tune and adept at developing even a basic compensation plan that will help you attract high quality employees. Remember, a basic plan is a starting point – your goal should be to grow your compensation plan to attract a higher, and higher quality employee – and keep them. If you don’t have a compensation plan currently, I strongly suggest you make the first call to your payroll company and start the discussion. You will be glad you did!

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