4 Hourly rate plus bonus based upon efficiency
In this compensation program the tech is paid an hourly rate based upon their level of experience. For example: C-level tech $8-10, B-level $10-13, A-level $13-15. The remaining money they earn will be based upon the level of efficiency they reach. The minimum level is 85% while the top level is 125% and higher.
In this plan the tech has the ability to make an increasingly larger bonus per billable hour based upon their speed and training. The down side is that it takes a little more time to keep track of the efficiencies for each tech, and the dealership needs to move to a heavier percentage of flat-rate repairs.
The upside is a strong drive by the techs to reach higher performance—which produces more dollars for the dealerships and faster turn times for the customers.
Regardless of how you currently compensate your people, you owe it to yourself and your dealership to take some time over the next few weeks and ask yourself if it motivates your people and drives the performance you are looking for. If not, make some changes as you move into next year.
Remember, your goal is to push your dealership and your employees to produce the results you are looking for—and to help you maintain your competitive position in your market.