If you own a lawn care business, you’re often wondering if you’re compensating employees the right way. Are you paying them too much? Not enough? Better than your competitors?
By the end of this article you will learn:
· The factors involved in determining what to pay your employees
· The three main pay structures used in the lawn care industry
· The average pay throughout the country
· How bonuses, benefits, perks and weigh in on overall compensation
· Pay isn’t the only way of recognizing employees and ensuring job satisfaction
What you pay your employees not only affects your bottom line, it also determines the quality of work and attention to detail you provide to your customers.
Remember your employees are a DIRECT reflection of YOU.
By the end of this article you’ll be a compensation king or queen AND have a much better idea on what to pay your lawn care employees.
A quick search on Indeed for “lawn care specialist” lists pay anywhere from $12 to $25 an hour.
Here’s how the US Bureau of Labor Statistics breaks it down:
● Landscapers: $14.88 hourly or $30,940 annually
● Spray Techs: $18.37 or $38,210 annually
● Foreman or crew leaders: $24.66 or $51,280 annually
These are the average numbers for each position. Of course how much you pay out depends on whatever benefits you may offer as the total compensation package. Is there pay time off? Are there benefits or bonuses? These are becoming just as important to workers as the hourly rate.
In a moment, we’ll cover how to pay your employees in a way that will guarantee that your lawn business stays profitable, but first let’s take a look at lawn care wages by region.
Payment also varies by geographic area. Here are the landscaper numbers from a few major markets across the US:
· California $16.59 hourly or $34,510 annually
· Texas $13.55 hourly or $28,170 annually
· Florida $13.28 hourly or $27,610 annually
· Washington $17.75 hourly or $36,910 annually
· Hawaii $16.38 hourly or $34,070 annually
· Florida $13.528 hourly or $27,610 annually
There are four main ways that lawn care professionals may be paid by their employers and there are numerous hybrid combinations of them.
Hourly: The old school, “normal” way that lawn care professionals have been paid for years. This applies to almost any industry. A person is paid a certain dollar amount per hour and time and a half for hours worked over 40.
Salary: Sometimes you can pay a flat yearly salary. This is especially viable for spray techs or anyone higher level than an introductory position.
Pay By Day: This structure pays an employee for each day. For example you may pay an employee $130 a day.
A word of caution: if the employee ends up logging more than eight hours this doesn’t get you out of overtime laws.
An employee still must be paid at least minimum wage for 40 hours. You have to be very careful about getting audited with both this type of payment structure and the next one Pay for Performance
Pay for Performance: Performance-based compensation pays an employee a certain amount of money for each specific job. It is legal but again you still need to track the employees’ hours and make sure you’re not running into overtime problems.
There are pros and cons to each pay structure. Hourly/salary concerns include lack of ownership, lack of incentive, mailing it in. Let’s look at Pay for Performance.
● Incentivizes—employees start to think and work like owners/entrepreneurs
● Allows workers to work harder and make more money
● Employees take better care of the equipment (breakdowns mean lost money)
● Improves callbacks
● Overtime law concerns
● Can lead to poor quality work if they hurry and get sloppy
Regardless of what pay structure your employees are on, there are ways to keep MORALE HIGH and make employees feel like they are a VALUED part of the business.
There are a ton of factors to consider when coming up with your pay structure, whether you pay an hourly wage, pay by day or pay based on performance.
Performance pay is becoming more and more popular in the industry and gives the employee more “ownership” over a job. Pay is based on each job instead of an hourly rate. A little skin in the game. We’ll cover this later.
Let’s look at just a few of the factors that determine how much to pay your employees.
Here are the obvious ones:
● Location. Different areas of the country pay more or less as a result of many factors --cost of living, taxes, etc.
● The market. When unemployment is low it’s going to be tough to find good employees and you may need to pay more.
● Your competition. Obviously you want to be competitive or you are going to end up with the lawn care “leftovers.”
Here are some factors relating to the employees:
● Attitude, work ethic, morals, loyalty
● Performance and amount of callbacks
● Does the employee work well as part of a team?
In a nutshell: It can help, but it’s not guaranteed.
You don’t want to be the low payer among your competitors because chances are --you’ll get the least amount of work in return.
Paying the employees is so much more than their take home pay. Money in their pockets is important but not the end all be all.
Pay what you can afford to pay and still be profitable.
Bonuses, benefits, lunches all factor in when you are trying to attract the best employees. Incentives go a long way.
People want to feel appreciated. If you treat your employees like a family chances are they will work hard for you and put their best foot forward.
If they get nickel and dimed and micromanaged they may look elsewhere.
Now that’s not to say that your employees don’t have to be held accountable. We’ve all seen people that take advantage. A half hour lunch turns into 45 minutes. A job is finished and the crew drags its feet starting the next job. It happens. As an owner you just want to minimize it.
Senior Landscape Designer Karl Naegler from Rochester, NY has seen it all in his 20+ years of experience.
|“If you take care of your employees, listen to them, treat them fair and as equals to one another, give them at least 2 reviews, have a clear set of goals you would like them to perform, and have an open door policy, on any topic, then you will retain them. Higher pay is just one item.”Karl Naegler CNLPVP New York State Nursery and Landscape Association Board|
So what kinds of perks do lawn care companies offer their employees to stay competitive?
● Comp time
● Gift cards
● Incentive Program that is simple and public
● Company events (i.e. cookouts, parties, etc.)
|I have done all sorts of things, my favorite was handing out scratch off tickets if the crews hit their quota for the week. If all met it by noon on Friday, then a lunch party was provided at 1pm and they got paid for it. It helped keep overtime down, yet they were being rewarded. They also got the big scratch off $10 ticket, and we had fun hanging out talking shop at the end of the week. I had a ton of respect for my employees, and I tried my best to keep it on a professional level. Karl Naegler CNLPVP New York State Nursery and Landscape Association Board|
For ideas on how to reward your employees check out “5 Incentive Ideas for Your Green Industry Business” by Chad Reinholz.
Salary and pay are still very important to employees but many consider benefits to be in the conversation.
|80% of employees would prefer new or additional benefits over a pay increase|
And when it comes to the younger generation that number gets even higher.
|90% of millennials would prefer benefits over a pay raise.|
Manage your clients and employees all in one system
So what should you ultimately pay your employees? Your workers are the lifeblood of your business. Pay them as much as you can afford while still earning a profit and keeping the business financially healthy. Remember that benefits and recognition also go a long way.
Feeling like you know a little bit more about what to pay your lawn care employees?
Let’s end with a few final points that you can use as you figure out your own payment structure.
You should now have a pretty good idea on many factors that go into compensation. Geographic area, your employee’s skillset and experience are just a few.
You also now have a handle on the three different pay structures: hourly/salary, pay by day and pay for performance. Which one is right for you?
Seeing the raw numbers from the Bureau of Labor Statistics can give you a rough number of compensation around the country. This should help guide you in setting your own payment.
Keep in mind that workers are not just concerned with their paycheck. Perks such as time off, bonuses and incentives go along way to attracting quality employees AND keeping them.
Finally, there’s many things you can do for your employees that require little or no money. Simply encouraging and trusting your staff or rewarding them with lunch or tickets are small signs of encouragement that lead to job satisfaction.