According to the DOL (department of Labor) an employee can be paid by the hour or for piece work (by the job)


The Act requires employers of covered employees who are not otherwise exempt to pay these employees a minimum wage of not less than $5.15 an hour as of September 1, 1997. Youths under 20 years of age may be paid a minimum wage of not less than $4.25 an hour during the first 90 consecutive calendar days of employment with an employer. Employers may not displace any employee to hire someone at the youth minimum wage.

Employers may pay employees on a piece‑rate basis, as long as they receive at least the equivalent of the required minimum hourly wage rate. Employers of tipped employees (i.e., those who customarily and regularly receive more than $30 a month in tips) may consider such tips as part of their wages, but employers must pay a direct wage of at least $2.13 per hour if they claim a tip credit. They must also meet certain other conditions.

I suppose that if these guys manage to spend over 20 (10 hrs each) hrs on every install for the pay period, then I would have to adjust their pay to bring them up to minimum wage. That hasn't been a problem. They average about 3 hrs/install including drive time. This is about twice as fast as installs got done back when they were paid hourly. This is a win/win/win solution as I see it. The employees like the method for making extra money. The customers like the techs getting in and out in a reasonable time. I like getting 2 or 3 installs/day vs 1/day like we got back when techs got paid per hour.

We treat their install pay just like regular income. We withhold the withholdings, deal with the social security, etc.

Lincoln Welder mfg company in Ohio pays EVERY employee piece-wage only. You might get $4/ea to wind motors, $2/ea to install a switch, $7/ea to screw wheels on, $1.50 to inspect parts, etc.
They have withholdings, pay social security, etc. They even clock in/out, to insure to OSHA that no employee is working more than 120 hrs/week but this method has been in place for years and works very well. The employees love it and the unions hate it. It insures that the new guy in training  gets up to speed in a reasonable time or washes out. The guy who has been there for 10 years can handle 10 $4 units/hr can make decent money.

Pete Davis

Scott Reed wrote:
You might want to check with your accountant.  I doubt the IRS is going to let you "contract" with people you also employ.  You may be liable for FICA, etc. for all the installs they have done.

Scott Reed
Wireless Networking
Network Design, Installation and Administration

---------- Original Message -----------
From: Pete Davis <[EMAIL PROTECTED]>
To: [EMAIL PROTECTED], WISPA General List <>
Sent: Fri, 22 Sep 2006 07:40:09 -0500
Subject: Re: [WISPA] Outsourced installations

> We outsource most of our installs to our employees. The two techs usually go out together, and split the $100. Its not unheard of for my techs to make more money on a busy week than I take in my salary, and I am an owner.
> They make $x/hr to do service calls, uninstalls, AP maintenance, etc and if they can keep those caught up, we schedule an install (usually 1 or 2 /day for 2 techs). They are OFF the clock for installs, and get $100/install. We provide the van, the tools, the gas, the CPE, and all consumables (staples, caulk, cat5, ends, jacks, faceplates, etc). That keeps them from usually turning in overtime. It gives them an incentive for completing installs in a timely manner (2 hr install = $25/hr/tech). Any service calls resulting from a faulty/sloppy install in the first 30 days result in the installer techs going on site to fix it on THEIR time, so they have an incentive to get it done right the first time around.
> We have a few other local IT/phone/security system consultants who will occasionally bring us a customer and offer to install them, since they are an existing consulting customer for them anyway and usually selling them a custom network/phone system/security system/audio system anyway. We will usually give them $125 or $150 and provide the CPE and minimal technical support. They will bring us the contract/customer worksheet for our files, and we don't even have to go on site. Since we usually charge $149 for the setup, we often let the consultant charge whatever he wants, and keep it, and put in as many custom cable runs and terminations as they can sell. We just start picking up the monthly billing.
> Those are good relationships to have.
> Pete Davis
> chris cooper wrote:

> Im sure this has been covered before…..
> Have any of you outsourced installations?  If so, has it been a positive experience, how much do you pay a contractor?
> Thanks
> Chris

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