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Why Can’t We Get Paid Mechanical Rates for Mechanical Operations?

What can we as technicians do to get paid for mechanical operations included in body operations? We seem to be at the mercy of collision programs influenced by insurance companies.

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Barrett has authored numerous industry trade journal/magazine articles, including several cover stories for BodyShop Business. Having grown up in a family-owned collision repair business and owner/operator of two successful collision repair facilities; his ongoing efforts as industry speaker and repairer coach-consultant are geared toward educating professionals and consumers to achieve equally successful resolutions to automotive-related property damage issues. Such issues include proper and thorough repair, reasonable repair profitability for repairers as well as equitable claim settlements for both claimants and the responsible/paying parties. ADE offers numerous professional services nationwide.

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What can we as technicians do to get paid for mechanical operations included in body operations? We seem to be at the mercy of collision programs influenced by insurance companies. Why not make mechanical operations mandatory? If it’s a mechanical operation, then pay at the present (mechanical) rate.

Repairers live and die by the industry labor guides and – in many cases – are unfairly compensated due to estimators’ lack of understanding of how to use these guides and insurers intentionally misusing them. Because there is no industry oversight, technicians are often at the mercy of who they work for, but this is changing. I’ve found that across the country, shop owners and managers are at the mercy of technicians…or the lack of competent technicians.

There may be recourse through the U.S. Department of Labor Wage and Hour Division (see the recent cases of unpaid overtime), but it also may be perceived as a condition of employment and state laws may or may not recognize such issues. There may be a more effective and efficient remedy. Let’s first look at the root of the issue.

Estimating

Estimating is such an extremely convoluted issue that I could write a book on the subject. However, the issues involved with estimating are likely due to many shops’ lack of estimating knowledge and/or the fear of going against insurer directives. So the short answer to your question is to simply tell your employer that if they do not properly and fairly compensate you for your collective knowledge, training and expertise, you’ll find an employer who will. A mere threat not acted upon remains a mere threat. Real change will only take place when the real risks begin to outweigh the rewards.

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Quality technicians are becoming a valued commodity in the collision repair industry, and with rapidly changing technologies and increased liabilities, skilled technicians have more value and power today than ever before. As such, more and more shop owners and managers must pay attention and listen carefully to their technical staff or suffer the consequences of losing valued team members. Those repairers who do listen and act will be doing more than merely repairing damaged vehicles; they will be repairing a significantly damaged industry.

Consider that the most important asset to any business is their customer. However, without the people to keep those promises, there would be no business! Repairers will need to be compelled to see the technical staff as part of this equation and be forced to do what is needed to make the proper decisions for the long-term success of their business. This won’t be easy for you or your employer, but it is necessary to achieve the fairness and change you seek and for the consumer to receive what they’re entitled to.

Guidebooks

Knowledge is your best asset, so I offer the following insight to proper estimating.

It’s imperative for repairers (estimators) to understand that the labor time guidebooks and databases are just that: guides. They are not absolute or even the rule; they offer nothing more than suggested or estimated minimal labor times (or “units”) to perform a specific procedure or function under perfect circumstances.

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Supposedly, the publishers of these industry labor guides rely upon OEM-supplied information and/or undergo actual monitoring and timing of average technicians, who possess average training, using average tools/equipment, in an average repair environment while performing the specific tasks on a brand new undamaged vehicle with brand-new “out of the box” parts/components. I believe too that they’re heavily influenced by third parties in both their development and real-world application.

The Mitchell estimating labor guide, as per Motor Collision Estimating Data, states in part: ”Operation times listed are based on new undamaged parts installed on new undamaged vehicles as individual operations. Time has not been considered for alignment pulls, damage-related access time, damaged, used, or remanufactured or aftermarket parts.”

Now, in all my 35-plus years in the collision repair industry, working as a child with my father, as a body and refinish tech, manager or owner, I’ve never prepared an estimate or performed a repair on a brand-new undamaged vehicle, nor have I ever met anyone who has. Of course, the reason for these times being based on this is to establish a baseline or foundation of the “minimum average time” it takes to perform a specific function that the repairer/estimator can use in their estimates. Once again, the published labor is not an allowance; it is the base minimum to perform that specific function (refinish, body, glass, mechanical/electrical, frame/structure and refinishing) for a brand-new vehicle with new, undamaged OEM parts. This information is to be used as a tool to assist an estimator in preparing a damage assessment based on the writer’s evaluation of the damaged vehicle.

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This means the published times are for parts with no rust, mud, road tar, crumpled, mashed/smashed metal and trim (making access impossible without cutting, pre-pulling, etc.) or grinder marks, sand scratches, wax, paint sealant, undercoating, pinstriping, trim adhesive and other existing materials that would first need be removed and/or repaired as necessary to be restored to new, out-of-the-box condition. Only then can the published labor guides’ suggested base labor time/units apply. Understanding this lends a basis for one getting paid the appropriate labor time for the function to be performed.

Labor Operations

Now, let’s address the various labor operations and your specific concern of getting paid for mechanical.

When a repairer/estimator prepares their damage repair blueprint, they should list each and every procedure, part and material that they believe is needed to achieve a proper and thorough repair that will restore the damaged vehicle to its pre-loss condition, in safety, appearance, function and value to the best of reasonable human ability, at a reasonable and competitive price for the level of services provided. In doing so, they should take into consideration all facets of their business such as profitability, liabilities (incurred and avoided), reputation and growth along with many others, including meeting the needs of their customers and those of their employees.

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Generally, estimating operations include:

  • Body labor (including interior)
  • Frame/structural labor
  • Mechanical/electrical labor
  • Glass labor
  • Refinish

The guidebooks will generally note which operation category the listed procedure will fall under, and the shop’s charge should be based upon the same. Given a technician who’s paid on a flat-rate system where he’s paid based upon the number of hours/units he has performed, he will be paid the appropriate number of hours for the procedure undertaken, whether it’s a judgment time or book time. By judgment time, I’m referring to a procedure where the estimator has used their judgment to provide a pre-determined (estimated) designated time to perform a specific function. This is generally associated with repair time for, say, repairing/straightening an outer or inner metal or composite panel, bumper cover, etc.

Another example where this may differ is when the published labor guides provide a suggested time to remove and replace or re-install (R&R or R&I) a part or component and the estimator adds judgment labor time for additional labor that will be needed to perform the task over and above the published labor time guide. An example is where the sustained damage requires a pre-pull to move damaged components to gain access to the damaged part and its mounting hardware (i.e. nuts, bolts, clips, fasteners, etc.). This is a way of overwriting/adjusting the “book time” or listing the additional labor as determined by the writer’s “judgment” as a separate line item in the estimate.

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Considering that this task will likely be performed by a body repair technician, one would not expect it to be listed under frame, mechanical or refinish. Using this same logic, should it be necessary for a tech to remove and replace suspension components, which the labor guides (and any reasonable and prudent person) would recognize as a mechanical function, one would not expect the estimate to list it as anything else. As such, the technician should be compensated fairly for his training, knowledge and experience in the performance of mechanical-related activities. Just because his normal duties are as a “body technician,” if he can perform additional duties and do them properly, he should be compensated properly based upon the pay rate for the specific services rendered (e.g. mechanical rate).

This should be kept in mind in situations such as the replacement of a truck’s frame. One wouldn’t necessarily charge “frame labor,” but because nearly all components (excluding the cab and bed) are mechanical-related, you shouldn’t accept all body labor either. When this issue arose at my shops, we sought to be compensated at the fairest and most reasonable rate for the services performed, including all mechanical functions such as cooling, A/C, powertrain, fuel, suspension and electrical-related functions. Those functions were paid at mechanical rates, and our flat-rate technicians were paid based on this as well.

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In-House Repairs

Repairers, customers and insurers should welcome and embrace the opportunity to have most if not all repair-related activities completed in-house to avoid additional and unnecessary delays, related costs and associated liabilities. Sending a vehicle to a sublet service provider may incur towing (plus mark-up) or two-tech/two-vehicle transport fees, as well as sublet mark-up for the services provided along with added delays and rental car costs. Furthermore, when a repairer only earns 20 to 35 percent mark-up for sublet, they could retain 62 percent or more in labor gross profit by performing such functions in-house. Not to mention they would be properly serving one of their most valued assets…their technical staff!

Summary

There are only two reasons why a repairer would stoop to pay their technicians less than they earn: one is intentionally “short-sheeting,” and the other would be placing others before their employees. Neither of these things are beneficial to the repairer or the technician.

Shop owners and managers need to understand that there is never a good reason to do the wrong thing. Responsible shop owners should step up to ensure their staff and company are fairly compensated for their efforts and the associated risks that accompany them.

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Repairers and flat-rate technicians need to understand that “If you don’t stand for something…you’ll fall for anything,” and ”As long as you continue to do as you have always done, you will continue to get what you have always gotten.”

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