How to Pay My Staff

My question involves employment and labor law for the state of: south Carolina

Own a contracting business.
I have trained staff, used corrective discipline, and provided detailed checklists
For quality control.

We are still faced with errors. I am convinced unless it effects their pocket book
Instead of mine this will continue (trying to resolve for over a year).

All I want is to pay for the job the first time. We pay good, but can't afford to
pay twice.

How can I work compensation to legally pay for the job once!
Our jobs can be broken down by piece or house (construction).

Was thinking paying by unit. Is that legal if they are not a "sub"?

Can I pay minimum wage + "bonus" that they would receive deductions from
For errors/delays?

Can I turn them into subs and deduct wcomp and gl out as percentage ( I
Hate this idea, but was a friends).

I hate the law forces me to tolerate errors. If I raise price to accommodate for
Errors I can't compete (employee loses job) or fire them (they lose job and cycle
Just repeats).

There has to be a more fair and practical way to reward for good work and save
Me from loss right??

Hire more qualified staff?

Look at your expectations versus realistic productivity?

Use a staffing agency?

You CAN pay minimum wage and then tie a production bonus to work that meets specifications.

You CAN pay by unit IF AND ONLY IF each employee is paid no less than minimum wage times hours worked, plus overtime if they work over 40 hours in a week.

You CANNOT make them subcontractors or any other kind of contractor if they meet the legal definition of employee.

You CAN fire the employees whose work is not up to standard (they WILL get unemployment).

Personally, I think you're taking entirely the wrong approach. You don't fix performance problems with compensation. You fix it through training (which you have done) and then holding employees accountable for their performance. If you have employees making dumb mistakes, then you discipline them. If the problem continues to occur, you discipline again and ultimately fire the employee if they can't perform at an adequate level.

Messing around with your employees' pay is not going to get you the results you want and need. They're not going to suddenly become more conscientious because you reduced their wages - they'll just become angry.

On expectations,
We have actually brought in subs from 3 of the other major
companies in our area to evaluate. We are on target, but
the other major companies use all sub-contract labor.

I do not like pure sub-contract because i lose some identity
and communication in the process.

The turnover rate in this field is high which effects consistency.


I simply want to get what i pay for. If i pay you $18 an hour
for an hours work and you do it absolutely wrong, then i dont
want to pay you twice. I think thats reasonable.

To note, he have a very explanatory company handbook, a standards
sheet that outlines all procedures, AND diagrams of proper installation
techniques.

Yes these are grown men we are talking about and they still have
errors costing me money. Unfortunately the cream of the crop
on brights dont flock to the new construction industry.
We have managers and laborers.

We went as far as to install some in between overseers but
this is just extra expense again.

I love the hourly plus bonus, any suggestion no how to manage
that properly so i meet laws and keep it from just sucking more
ours out of my back office then necessary to track?

How would overtime on per unit be factored? Would i pay them 1.5 the "unit" price?

Yes. Contact an employment law attorney. Messing around with your compensation plan is not a DIY project.

First, you have to have very clear directives of how you want something done. In the construction industry, there are myriad ways to do any given job. If you have a specific method you wish to employ, you need to communicate that to your workers. Then, as to having to re-do work: if they are just plain screwing up, even after training, then you need a better class of employee. You can discipline your employees with things like time off for screwing up and eventual firing if they continue to screw up.

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Unfortunately the cream of the crop
on brights dont flock to the new construction industry.

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Huh? I can tell you there are very qualified people working in the construction industry. In can be very competitive if you wish to hire the best so you need to pay compensation commensurate with their abilities. If there are others paying better than you, that is where the good tradesmen will go. If you pay as high as any other employer, you will be able to garner high quality employees.

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We have managers and laborers.

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there is your problem. You need tradesmen and foreman. Managers suggests office personnel. They typically are poor field supervisors. A skilled foreman is a great asset and is worth what you pay them. Complement that with skilled tradesmen rather than laborers (not demeaning laborers as they are a trade all of their own but laborers are not tradesmen). If you are expecting laborers to do skilled trade work, you are hiring the wrong people.

I hear what your saying, but we have evaluated those
items already. We are paying at or higher than our
competitors.

Our competitors where faced with the same problems,
they are now all subbing work out.

At the margins we have to work with there is not much
room for error. If its an error unaffected by the employee
then fine, i will cover.

But, we are in some manner going to have to offset this
issue by tying compensation into quality/productivity.

Assuming that im right, can someone please suggest
best practices in:

1.) Implementing and tracking this fairly, anyone seen
this done correctly?

2.) How to make the change legally? Im assuming
i cant just say, "Hey man your getting paid like this
now, take it or leave it".

I had thought about working it so they would in fact
get an increase in pay assuming they met quality standards
by going to this method.

Another interesting question, i have seen someone do
this and though i like it, not sure of legality of it.

They pay hourly base plus commission, if one technician
makes an error another fixes. The one that fixes itemizes
parts/labor and turns in. They deduct that amount from
the other technicians commission. I heard that what
happens majority of times is they handle it amongst selves,
which im fine with too.

Im not doubting your experience here, but please understand
my question is mostly on "how" to do this, ive already decided
i have to.

I want it to be beneficial to the ones that perform, but protecting
me from the errors of ones who do not. And in long run the
ones who do not will eliminate themselves.

Thanks for the feedback!!

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2.) How to make the change legally? Im assuming
i cant just say, "Hey man your getting paid like this
now, take it or leave it".

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as long as your method of pay is legal and there are no contracts preventing you from instituting the new pay method, yes, you can say exactly that.

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1.) Implementing and tracking this fairly, anyone seen
this done correctly?

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if you are wanting to do this on an individual basis, you will have to have nobody working together. Not conducive to an efficient building method. You might be able to break it down into groups or pairs but quantifying individual work is very difficult. You also will have the problem of a worker not being able to perform an assigned task because some other stage of the project is not completed. Do you expect the waiting worker to just stand around, without earning anything other than his base pay until the area he needs is ready? Is that fair?

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They pay hourly base plus commission, if one technician
makes an error another fixes. The one that fixes itemizes
parts/labor and turns in. They deduct that amount from
the other technicians commission.

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that takes an unfair amount of the first workers earnings. The first worker earned a commission for his work. Here you are paying the second worker all his time plus taking that same amount from the commission of the first worker. At most you need to take away whatever commission would have been earned on that specific job and give it to the repairman.

then, who determines what is a defect? Do they have to notify the manager (I chuckle every time I say that) of the defect and have the manager confirm before they repair? If so, how much time does that take the second worker where he is not earning anything other than his base pay? How much are you paying him to examine the defect and present it to the manager? What if the manager does not consider it a defect worthy of repair; what happens to the time the second employee took to examine and notify?

If not, what is to prevent an unsrupulous employee from simply saying there was a defect and he fixed it?

Can i not just deduct from there pay and leave them hourly?
Or is this illegal in S.C.?

Some have told me if i have a signed agreement by employee i can,
others have said i cant do it in S.C. Im confused.

I would have to look but in general, most states require an employee to agree to a deduction such as this and many even require the permission to be in writing. If they will not agree to the deduction, what then?