Work together to increase company efficiency and help combat the skyrocketing cost of living.

All of America is suffering from outrageous gasoline and fuel cost inflation, along with all of the costly side effects. Food costs are climbing and other industries are passing these extra costs on to the consumer - which is you and all your employees.

Unfortunately, the major item that is not increasing is your employees’ wages. Simple math will show you they cannot survive in this crisis.

The suffering economy is creating a lack of new construction, making it difficult to get a job and keep your employees working, let alone issue cost-of-living wage increases, which your employees desperately need and deserve.

We are definitely not in a position to stop or even control these fuel cost increases, but we can certainly counteract the negative effect. We will review a number of effective options that you and each individual employee can coordinate to increase your company’s efficiency together and reinforce their ability to combat the skyrocketing cost of living.

Let's Make A Deal

Naturally, you should already be using this strategy, as well as other value-engineering options, to enjoy a better reputation, bigger profits and more money for your employees. By making a separate “deal” - by bargaining with each individual employee - you can deal with specifics rather than generalities.

My recommendation is to begin with your entire management team. Spend at least 15 minutes, one-on-one, reviewing these options to get their input and commitment.

Depending on the size and organization of your company, you can then allot another 15 minutes, one-on-one, with each of your other employees; or allow your managers to deal with their individual subordinates.

You should begin your discussion by stating your sincere concern about his or her situation and explaining your inability to increase wages. Review these options and ask, “Can we do this?” and “What else can we do?” Document their input.

1. The first option is an increase in “take-home pay” to help your employees cope with all of these costs. Since you are not able to pass along wage increases to your customers, you can salvage this critical money by simply making the phrase “Do more to make more” the basis of your deal.

For an average employee, you are currently getting about six hours of actual work for an eight-hour paycheck.
  • They start late in the morning and may even have coffee or a snack onsite before actually working.
  • Their 15-minute coffee break at 9 or 10 a.m. can easily last 30 to 35 minutes.
  • Their half-hour lunch break is now more than one hour. Many employees do not carry a brown bag but go to a restaurant for lunch. In addition to wasting your valuable time, their lunch is more costly.
  • We also have employees wasting company time on personal cell phone calls from family or friends.
I have noticed many jobsite employees from all trades who are barely working five hours for their eight-hour paycheck. Your jobsite foreman is the only one who controls this and I have always recommended 8 1/2 hours each day for any foreman who is not salaried. When your foreman works 8 1/2 hours, you can rest assured that his crew will be working eight hours.

Simple math will show that your company can provide a 25 percent increase in each employee’s paycheck if each one is productive for a full eight hours rather than six.

You can also increase production and their take-home pay with our daily 6-8-10 scorecard and monthly wage reviews.

2. Your next option is to minimize fuel expenses.
  • At the top of this list is the virtual office concept where your employees work at home. In addition to rush hour travel expenses, these employees save on dress clothes, babysitting costs, etc. (For more on this, see “The Virtual Office Concept” in the August 2008 issue.)

  • By using flex time, your employees can eliminate much of their travel expenses with 3 – 13s or 4 – 10s. They can also bypass gas guzzling, congested rush hour traffic with varied start and quitting times.

  • Your employees can carpool or use public transportation where it is available.

  • Your foreman should use a written checklist for whatever tools and materials employees will need on their jobsite each day. This will prevent costly trips back to your shop or a supply house.

  • Your service techs can phone in an order for whatever they need and call a taxi to pick it up and deliver it to the customer’s site. This saves valuable time as well as costly travel expenses.

  • You can also conserve fuel with more energy-efficient vehicles.
3. Another option for your lower-paid jobsite employees is skill certification. Rather than holding back a journeyman’s wages for what they haven’t learned, you can pay them full scale for all of the tasks which you have certified.
  • You can reinforce this certification process with after-hours training on your jobsite or in your fab shop.

  • You should already be using mentors to assist willing learners.

  • You should use the professional title “intern” for your apprentices and green helpers wanting to learn our trade. They should be performing skilled craftsmanship rather than doing menial grunt work.
4. Minimize wasted dollars on materials, tools and equipment.
  • Material that will not be used on that site should be returned to the supplier or to your shop immediately. Ninety-five percent of what is stolen on our jobsites is taken by employees who use it at home or for moonlighting.

  • You need to return rental tools and equipment as quickly as possible.

  • Your foreman needs to walk the entire site at quitting time to pick up any tools and disconnect any equipment.

  • You need fall protection around excavations and should take down any ladders before leaving the jobsite.
Depending on the size of your company, the size and type of work that you perform, and the location of your jobsites, you can easily add more specific cost-saving options to this list.

You will be pleasantly surprised by the eager reception and involvement as your  employees realize that you are also in a bind and are willing to cooperate to benefit everyone. We have already covered all of these options in previous Plumbing & Mechanical articles and there are no negatives or extra costs involved.

Keep in mind, none of this will work if both parties do not honor the deal they make!

We do not know how high gas prices will go or how long this cost-of-living crisis will last. The one thing that you can be sure of is that both you and your employees will be in a better position to combat whatever happens. When the economy is back on track, don’t stop dealing with your employees. It’s called “survival of the fittest."