Save 20 Percent On Labor This Year
This new year is forcing us to add the “20” when we say or write 2010. Everyone easily recognized and understood what ’01 through ’09 meant, but that will definitely not work with “10.”
You should use that as a timely reminder to go get that 20-percent savings on your jobsite labor costs. We will look at numerous methods to do so, but for many contractors, you can get it all with one company-wide commitment: Demand a full eight hours work for a full eight-hour paycheck!
If you visit your jobsites, you will agree that many of the trades do not work a full eight hours each day for that paycheck (I hope this doesn’t apply to your workers):
1. They start late in morning.
2. Their 15-minute lunch break is more than a half hour.
3. A 30-minute lunch break is unheard of, especially for those who do not pack a lunch. It is impossible to leave the jobsite, go to a crowded restaurant, eat lunch and be back at the job in a half hour.
4. Many craftsmen also take an afternoon coffee break that is, again, more than 15 minutes.
5. They quit early at end of each day; they have something personal to take care of that is far more important than your job.
6. Some companies allow 15 minutes pick-up time to put away the company’s tools and equipment. Many assume that time should be in their pick-up truck.
I visit jobsites and can’t understand why no one is concerned or trying to remedy these losses. Even if they averaged six hours of work each day, that would be a 25-percent waste factor. And some don’t even average those six hours a day on the job!
Wouldn’t that be a good place to get that 20 percent you need for 2010? Naturally, your first question is: “How can we change? That is what our employees are used to doing and our industry accepts it.”
Everyone knows our economy is in trouble and times are tough for most contractors. That opens the door to belt-tightening measures and positive one-on-one communications with your employees.
Your jobsite foreman is the key to this entire problem, as well as the solution for saving that 20 percent. You, who have worked on jobsites, are well aware that when your foreman is working, his or her crew is also working.
The largest majority of our industry’s craft foremen in all trades have had no training in supervision, leadership, communication, discipline, motivation or human relations. They are good, capable employees who are very aware and concerned about how much you are losing when they get you six hours’ work for an eight-hour paycheck. Unfortunately, they don’t know how to stop it.
Depending on the size of your company, the number of foremen you employ and the type of work you do, you can license this strategy one-on-one or in group sessions if necessary. The critical factor is timing - do it now!
Getting Those Eight HoursThe best place to start is with an apology for not having done something sooner. You can then use a very basic example of buying a dozen eggs for $2. If you open the carton and there are only nine eggs inside, you would definitely not pay the full $2. You would ask for the other three eggs or agree to pay $1.50, which would be the agreed-upon price.
Why would it not be the same for an agreed-upon eight-hour wage? You must get the full eight hours of work or pay only for the number of hours worked each day.
This example is just as easy for your foremen to explain to their workers. They are not asking for or demanding something for nothing. They simply should receive what they are buying at an agreed-upon price with your money. Union foremen clearly have this established in their negotiated contract and also written in their jobsite work rules.
It would be a hardship for your employees to take home a smaller paycheck, especially when they are on the job and could have easily given the full eight hours of productivity.
For employees who do not have the facilities to pack a brown-bag lunch:
You may have an employee who is consistently late in the morning or leaves early at the end of each work day. Your foreman should discuss the reasons for his lateness and recommend workable solutions to eliminate the need to reduce his paycheck. Optional flex-time hours are worth considering.
Employees who report to your shop and than travel to your jobsite are entitled to travel pay. On larger projects, it may be convenient to have them go directly to your site from home to eliminate the required travel pay.
Many companies require their craftsmen to pick up their own personal tools after quitting time. The foreman receives an extra 30 minutes each day to distribute and put away company tools.
Your foreman should discuss any of these or other situations that would apply to his or her employees privately. Your superintendent, project manager or next in the chain of command may assist, but should not bypass your foreman. Should any disciplinary measures be necessary, you must respect and follow your written chain of command.
Many contractors fear that enforcing company rules would de-motivate their employees and reduce productivity. That is not true and you should have a reliable system to measure and reward performance already in place. Here again, you can easily understand that your jobsite foreman is in total control of your labor costs.
When Your Foreman Is LateSeveral times a year, one of my clients will ask, “What do you think about a foreman who comes to work late? He’s a good foreman but he’s not on the jobsite when he should be.”
That is an oxymoron. A responsible person in charge of jobsite personnel would never come to work late without a viable reason or having had an accident. Any situations that your foreman would discuss with his employees about coming to work late also apply to him. This is especially true with flex-time, meals and break times.
Your foreman should always have a predictable emergency plan to ensure that the jobsite will be productive in his absence.
You should always have a dependable “second-in-command” employee learning job supervision from your foreman on every jobsite. That employee should carry a key to your trailer or job box; know where the blueprints, tools and materials are; and enjoy a working relationship with your customer and the involved trades on the job. He would have access to your foreman by cell phone, as well as other company personnel, in an emergency.
This second-in-command employee would also maintain cost control when your foreman is involved in a jobsite meeting or examining critical paperwork in your trailer.
Your foreman should compile a one-week accurate job schedule, which is usually established at weekly jobsite meetings, and make specific job assignments at the end of each day for the next day’s work. That is also effective every morning when your foreman is busy getting the crew started.
Fortunately, this timely reminder to add the “20” to the year 2010 will also apply for the following years. You should likewise continue to add that 20-percent savings to your cost control. Next time we will continue with more ways to enjoy these savings.