Handyman pay rate structure

[Louis Balfour]

We have a few handymen who work for us now and they all charge different rates for call-outs and work completed.

I need to agree rates with a new chap, who doesn't have a "usual" rate and I need to do that ahead of Christmas, because he will be providing cover. Whatever I agree with him, we may roll out to other contractors who work regularly for us. These are all self-employed people and I need to work out something that we can afford, whilst being an incentive to do what we need.

I am thinking:

£X for a call-out, to include the first hour of work.

£X+Y for weekend call-outs.

£2X for bank holidays.

£2.5X for Christmas day.

I've yet to decide values for X and Y.

Any advance on that structure?

[r3g]

Louis Balfour said:

We have a few handymen who work for us now and they all charge different rates for call-outs and work completed.

I need to agree rates with a new chap, who doesn't have a "usual" rate and I need to do that ahead of Christmas, because he will be providing cover. Whatever I agree with him, we may roll out to other contractors who work regularly for us. These are all self-employed people and I need to work out something that we can afford, whilst being an incentive to do what we need.

I am thinking:

£X for a call-out, to include the first hour of work.

£X+Y for weekend call-outs.

£2X for bank holidays.

£2.5X for Christmas day.

I've yet to decide values for X and Y.

Any advance on that structure?

If they are self-employed then you don't have any say in the matter beyond "yes we can give you work when it's available" and "sorry no, your rate is too expensive for us". It's up to them to decide how much they are going to charge you, not the other way around.

[Hammersia]

Are they all coming from different places?

Call out cost will vary according to far they have to come.

[Louis Balfour]

Hammersia said:

Are they all coming from different places?

Call out cost will vary according to far they have to come.

All quite local to where they need to work.

[Louis Balfour]

r3g said:

Louis Balfour said:

We have a few handymen who work for us now and they all charge different rates for call-outs and work completed.

I need to agree rates with a new chap, who doesn't have a "usual" rate and I need to do that ahead of Christmas, because he will be providing cover. Whatever I agree with him, we may roll out to other contractors who work regularly for us. These are all self-employed people and I need to work out something that we can afford, whilst being an incentive to do what we need.

I am thinking:

£X for a call-out, to include the first hour of work.

£X+Y for weekend call-outs.

£2X for bank holidays.

£2.5X for Christmas day.

I've yet to decide values for X and Y.

Any advance on that structure?

If they are self-employed then you don't have any say in the matter beyond "yes we can give you work when it's available" and "sorry no, your rate is too expensive for us". It's up to them to decide how much they are going to charge you, not the other way around.

Market forces.

We've one handyman who came to us dictating a rate that we will only pay if we are desperate. He gets virtually no work. Others asked for more reasonable money and they get work. The chap we are talking to doesn't know what he should charge, but really wants work. So I am trying to work out a tariff that is fair.

[Countdown]

I was thinking this was a bit odd but then I realised it's no different to having a schedule of rates for an Approved Contractor framework.

However, as they're self employed I don't see what the benefit is to YOU of applying the same rates to everybody. Those who would normally command a lower day rate will be more than happy to get a higher rate, Those who normally earn the higher rate won't agree to a rate cut and will just say "no thanks", so effectively you'll be putting them ALL on the highest rate

BTW AIUI we have agreed rates per job e.g. replace door £X00, replace window £Y00 and so on. That way there's no incentive for the Contractor to pad out the time taken. On some jobs they win, on some they lose.

Edited by Countdown on Tuesday 19th December 10:04

[r3g]

Louis Balfour said:

Market forces.

We've one handyman who came to us dictating a rate that we will only pay if we are desperate. He gets virtually no work. Others asked for more reasonable money and they get work. The chap we are talking to doesn't know what he should charge, but really wants work. So I am trying to work out a tariff that is fair.

But that isn't your problem nor your business. Your first 3 sentences is exactly how it should be . You have no place to be dictating the terms to self-employed persons because you are not their employer, hence the word self-employed. If you want to do that then employ him. Sounds like this is a perfect example of IR35 disguised employment from what you've said.

Sorry if I'm coming across blunt but that is the crux of it really. All you've got to do is say to the kid "we've got the work, let us know when you've decided how much you want per hour and we'll run the numbers and see if they work for us" and leave the ball in his court. If he can't tell you how much he wants then that's his loss and clearly being self-employed is the wrong way of working for him and needs to go get a PAYE job.

[ARHarh]

Why don't you just tell him what the others charge and see if that is acceptable to him? Seems simple if he has no idea what to charge.

By the way if he has no idea what to charge is he really the right man for the job? He must have experience of how long things take and how much he needs to earn surely.

[Louis Balfour]

r3g said:

Louis Balfour said:

Market forces.

We've one handyman who came to us dictating a rate that we will only pay if we are desperate. He gets virtually no work. Others asked for more reasonable money and they get work. The chap we are talking to doesn't know what he should charge, but really wants work. So I am trying to work out a tariff that is fair.

But that isn't your problem nor your business. Your first 3 sentences is exactly how it should be . You have no place to be dictating the terms to self-employed persons because you are not their employer, hence the word self-employed. If you want to do that then employ him. Sounds like this is a perfect example of IR35 disguised employment from what you've said.

Sorry if I'm coming across blunt but that is the crux of it really. All you've got to do is say to the kid "we've got the work, let us know when you've decided how much you want per hour and we'll run the numbers and see if they work for us" and leave the ball in his court. If he can't tell you how much he wants then that's his loss and clearly being self-employed is the wrong way of working for him and needs to go get a PAYE job.

As I said, market forces. We can, and do, dictate the rate with some self-employed tradesmen. It’s perfectly legitimate and, I would go as far as to say, the norm in some areas of industry.

As for IR35, it’s not even close.

[Louis Balfour]

Countdown said:

I was thinking this was a bit odd but then I realised it's no different to having a schedule of rates for an Approved Contractor framework.

However, as they're self employed I don't see what the benefit is to YOU of applying the same rates to everybody. Those who would normally command a lower day rate will be more than happy to get a higher rate, Those who normally earn the higher rate won't agree to a rate cut and will just say "no thanks", so effectively you'll be putting them ALL on the highest rate

BTW AIUI we have agreed rates per job e.g. replace door £X00, replace window £Y00 and so on. That way there's no incentive for the Contractor to pad out the time taken. On some jobs they win, on some they lose.

Edited by Countdown on Tuesday 19th December 10:04

No, it isn’t straightforward. There is also the consideration that some of our handymen are more useful than others.

As for a tariff for all jobs, at the last count we had 134,003,004 different possible tasks (I may have made that number up) and some jobs are a combination of tasks. We find it easier to pay an hourly rate with a caution not to take the piss. In the vast majority of cases that has always worked. Yes we have had the odd newby who has seen it as an opportunity to charge us for eating breakfast, but they quickly fall by the wayside.

[Countdown]

Louis Balfour said:

No, it isn’t straightforward. There is also the consideration that some of our handymen are more useful than others.

As for a tariff for all jobs, at the last count we had 134,003,004 different possible tasks (I may have made that number up) and some jobs are a combination of tasks. We find it easier to pay an hourly rate with a caution not to take the piss. In the vast majority of cases that has always worked. Yes we have had the odd newby who has seen it as an opportunity to charge us for eating breakfast, but they quickly fall by the wayside.

If that's the case it seems counter-productive having the same rate for all of them. Some are obviously worth more to you and others less.

Re: a tariff for all jobs the organisation i work for manages about 20,000 properties. It would be absolutely bonkers having to get a quote each time we needed a job doing which is why we have a pre-agreed rate per job. There really aren't that many unique jobs.

In terms of paying by hourly rate, with respect, unless you're an expert in each different trade you won't have an accurate idea as to how much time it should take so you won't know if they're taking the piss.

[r3g]

ARHarh said:

Why don't you just tell him what the others charge and see if that is acceptable to him? Seems simple if he has no idea what to charge.

I'd be pretty pissed if I found out my client had been telling other contractors what I charged. That's private and confidential information and nobody else's business. All it does is start a race to the bottom on rates as your competitors price slightly lower than you to get the work, which ultimately results in you losing all your best contractors who went above the call of duty to get you out of the st when you were stuck and then you lose all your customers as well when they get pissed off with the shoddy workmanship from all the cheap-ass useless contractors you're now using.

[Louis Balfour]

Countdown said:

Louis Balfour said:

No, it isn’t straightforward. There is also the consideration that some of our handymen are more useful than others.

As for a tariff for all jobs, at the last count we had 134,003,004 different possible tasks (I may have made that number up) and some jobs are a combination of tasks. We find it easier to pay an hourly rate with a caution not to take the piss. In the vast majority of cases that has always worked. Yes we have had the odd newby who has seen it as an opportunity to charge us for eating breakfast, but they quickly fall by the wayside.

If that's the case it seems counter-productive having the same rate for all of them. Some are obviously worth more to you and others less.

Re: a tariff for all jobs the organisation i work for manages about 20,000 properties. It would be absolutely bonkers having to get a quote each time we needed a job doing which is why we have a pre-agreed rate per job. There really aren't that many unique jobs.

In terms of paying by hourly rate, with respect, unless you're an expert in each different trade you won't have an accurate idea as to how much time it should take so you won't know if they're taking the piss.

I don’t think I have said that I was going to implement a standard rate, that was your idea wasn’t it? This relates to one specific chap that we are just starting to use.

If your properties have a limited number of job permutations you obviously have different stock from us!

Anyway lest I derail my own thread: What do we think is a fair uplift for Christmas Day, Boxing Day and
New year? Double time?

[r3g]

Louis Balfour said:

Anyway lest I derail my own thread: What do we think is a fair uplift for Christmas Day, Boxing Day and
New year? Double time?

Ask your self-employed contractors ! They're the ones who will be doing the job so they will tell you how much they want.

[Louis Balfour]

r3g said:

Louis Balfour said:

Anyway lest I derail my own thread: What do we think is a fair uplift for Christmas Day, Boxing Day and
New year? Double time?

Ask your self-employed contractors ! They're the ones who will be doing the job so they will tell you how much they want.

Because tradesmen often need protecting from themselves, basically.

I will give you an example.

A tree surgeon came to do work at our house and brought with him a young but enthusiastic assistant. It turned out that he was a ground worker by trade.

At the end of the tree work, I asked him if he wanted to do some landscaping for us. As the job was quite nebulous I said I would pay a day rate and asked him how much he wanted. He glanced up at Balfour towers and without looking me in the eye said £600 a day”.

I smirked and pointed out that, at that time, our best paid tradesmen were earning £150 per day.

“Ok £150 then”.

He has gone on to be one of our most trusted contractors, who absolutely does not take the piss..

I could have just written him off, due to his initial bid. Laissez faire economics and all. But he would have missed out on a lot of work and we a good, reliable tradesman.

[r3g]

Louis Balfour said:

Because tradesmen often need protecting from themselves, basically.

I will give you an example.

A tree surgeon came to do work at our house and brought with him a young but enthusiastic assistant. It turned out that he was a ground worker by trade.

At the end of the tree work, I asked him if he wanted to do some landscaping for us. As the job was quite nebulous I said I would pay a day rate and asked him how much he wanted. He glanced up at Balfour towers and without looking me in the eye said £600 a day”.

I smirked and pointed out that, at that time, our best paid tradesmen were earning £150 per day.

“Ok £150 then”.

He has gone on to be one of our most trusted contractors, who absolutely does not take the piss..

I could have just written him off, due to his initial bid. Laissez faire economics and all. But he would have missed out on a lot of work and we a good, reliable tradesman.

Explain why can't you have this exact conversation with your self-employed contractors, but instead of asking for a price to do landscaping, you ask if they want to work the Christmas holiday days and how much they'd want, then negotiate the price from there?

The bottom line is you want the work done as cheaply as possible to maximise your income and they want to be paid as much as possible to do the work to maximise their income. One of you has to MTFU and start a proper conversation. The fact that the guy you want to do it doesn't seem too interested (ie. refusing to give you any figures) suggests that you need him more than he needs you, so he holds the ace cards in any rate negotiations.

[nuyorican]

Forgive me if I’m wrong OP, but it does read like you’re confused about the employee/self employed thing. As a self employed tradesman myself I do occasionally come up against people like yourself who seem to want an employee but without any of the extra cost and responsibility that comes with it.

Saying things like ‘eating breakfast on our time’ etc. I’m guessing you’re rural, not in a city anyway. Where I am I’ve never heard of the person you’re doing the job for dictating the rates. Myself and pretty much every other tradesman I’ve met dictates the price and if it’s unacceptable then hey ho. As for the lad who doesn’t know what to charge, well that speaks volumes.

[Countdown]

Louis Balfour said:

Anyway lest I derail my own thread: What do we think is a fair uplift for Christmas Day, Boxing Day and
New year? Double time?

I assume you're only employing them for any emergency callouts (rather than normal repairs and maintenance)? if that's the case they'll tell you how much they want as opposed to you offering a rate

ETA I know you gave an example of a tradesman asking for £Silly and you told him "No thanks, I'm only paying you what i think is sensible" But in my experience if it's an emergency callout for a tenant you won't have much choice or much time to shop around (I'm talking about something like no gas/electricity/hot water). Obvs if it's a non-emergency repair then you won't actually need to call them out on a bank Holiday.

For our personal tenanted properties we use Corgi Homecover precisely to avoid this kind of headache.

Edited by Countdown on Tuesday 19th December 16:09

[Louis Balfour]

Countdown said:

Louis Balfour said:

Anyway lest I derail my own thread: What do we think is a fair uplift for Christmas Day, Boxing Day and
New year? Double time?

I assume you're only employing them for any emergency callouts (rather than normal repairs and maintenance)? if that's the case they'll tell you how much they want as opposed to you offering a rate

No, each has a different level of skill / willingness to take on larger jobs. By larger I mean something like a shower tray replacement. Beyond that we have builders.

Countdown said:

ETA I know you gave an example of a tradesman asking for £Silly and you told him "No thanks, I'm only paying you what i think is sensible" But in my experience if it's an emergency callout for a tenant you won't have much choice or much time to shop around (I'm talking about something like no gas/electricity/hot water).

That is why we tend to have our ducks in a row well ahead of a bank holiday, so there is no last minute horse trading.

Countdown said:

For our personal tenanted properties we use Corgi Homecover precisely to avoid this kind of headache.

Ever tried using that over Christmas? We used to have insurance cover and trying to actually get someone out over weekends and bank holidays could be problematic. Furthermore, that will cover your boiler problems only, I assume. Of little use for an electrical fault or key snapped in a lock.

Edited by Countdown on Tuesday 19th December 16:09

[Louis Balfour]

nuyorican said:

Forgive me if I’m wrong OP, but it does read like you’re confused about the employee/self employed thing. As a self employed tradesman myself I do occasionally come up against people like yourself who seem to want an employee but without any of the extra cost and responsibility that comes with it.

We know only too well the difference between employed and self-employed. We avoid the former if at all possible! Every contractor we use has other customers, but generally we get good attention because we are good to work with and pay promptly.

nuyorican said:

Saying things like ‘eating breakfast on our time’ etc. I’m guessing you’re rural, not in a city anyway.

No, urban. To give you an example of what I mean, a joiner was recommended to us by another tradesman who we trusted to work on a day rate. The joiner did his first (and last) job for us and added on travel time to his already punchy day rate. This included an afternoon when he was out for a bike ride, passing our site, and just wanted to check some measurements. We didn't need to tell him he was no longer required, the recommender did it.

nuyorican said:

Where I am I’ve never heard of the person you’re doing the job for dictating the rates. Myself and pretty much every other tradesman I’ve met dictates the price and if it’s unacceptable then hey ho. As for the lad who doesn’t know what to charge, well that speaks volumes.

It depends on the state of the market. There are times when we are price takers, but other times we offer work at a rate and it is a matter for the trade whether they accept it. During lean times we see what we call the day rate ratchet, whereby trades won't work for less than their previous highest day rate. Many of them have wives with regular employment and can afford to do that. Others need the money and accept the rate.