For more than 70 years, dealers with an NCM 20 Group membership have exchanged best practices, experiences, processes, and strategies to sustain success in the retail automotive industry. In all 20 Group meetings, members share ideas that help them overcome a variety of challenges, and in the last year alone, we have heard hundreds of ideas shared amongst our members. Today, we are going to share one of the best ideas from 2019, in the hopes that it can be applied to your dealership and helps improve your dealership performance.
20 Group Idea: Technician Career Builder Program
Hiring and retaining technicians is a problem throughout the automotive industry right now. At our dealership, we have implemented a deferred bonus program for our technicians to help solve this issue. Service center technicians are eligible to earn $1.25 per flat rate hour and body shop technicians are eligible to earn $0.75 per flat rate hour, based on individual performance. Take a look at the conditions below.
Service Center Technicians: As of March 1 of each class year, individuals employed as full-time, flat rate hourly technicians who have a minimum of three current ASE mechanical certifications, and flag individually a minimum of 1,560 flat rate hours for the payroll year, will be eligible to participate.
Body Center Body & Paint Technicians: As of March 1 of each class year, individuals employed as full-time flat rate hour technicians who have ICAR Pro Level one or two status, ASE certification in their area of specialty, and flag individually a minimum of 2,080 flat rate hours for the payroll year will be eligible to participate.
Deferred bonus will be accrued on each flat rate hour flagged each pay period, retroactive to the first flat rate hour. Each pay period, the individual’s flat rate hours will be totaled and rounded to the nearest hour. Tenths of an hour will not be carried forward pay period to pay period.
Deferred Bonus Maturity Period
Career Builder deferred bonus funds will be earned on a class year basis, with a class year defined as a calendar year (Jan. 1 through Dec. 31 of the year in question). A class year will mature on Dec. 31 of the second year following the end of the class year. For example, deferred bonus earned as part of the 2014 class year will mature on Dec. 31, 2016 and payable no later than March 1, 2017.
Deferred bonus will be credited to the technician’s individual Career Builder account for the class year in which the pay period earnings are paid. For example, the first pay period of the 2014 payroll year begins Tuesday, Dec. 17, 2013 and the last pay period ends Monday, Dec. 15, 2014. Career Builder deferred bonus funds will be credited to the 2014 class year for that payroll year.
Technician Continuous Employment Requirement
To receive full payment of Career Builder deferred bonus, a technician must maintain continuous employment with the dealership until maturity of a given class year, and through the date of the bonus payout.
Forfeit of Career Builder Deferred Bonus
A technician, who for any reason is no longer employed with the dealership, forfeits all Career Builder deferred bonus with the following exceptions:
- Retirement – a technician who reaches the age of 62 and elects to retire will be eligible to receive all accrued deferred bonus, regardless of class year maturity. A deferred bonus funds check to the retiree will be mailed within 90 days of the retirement date.
- Death – the estate of the employed technician who dies will receive all accrued deferred bonus regardless of class year maturity. Supporting documentation proving death (i.e. death certificate) must be supplied. A check for all non-matured deferred bonus funds will be mailed to the technician’s estate within 90 days following receipt of completed documentation.
- Internal Status Change – if a technician assumes other responsibilities at the dealership for which he/she would otherwise not be eligible to participate in Career Builder, he/she remains eligible to receive deferred bonus accrued as a technician as class years mature, if he/she maintains continuous employment in another capacity at the dealership.
The dealership, in its sole discretion, reserves the right to terminate or modify the Career Builder Program for any reason and will provide participating technicians with notification 60 days prior to the cessation of contributions under the program provisions. Should the dealership choose to discontinue the program, all deferred bonus fund accrual ceases, and funds will be paid to eligible technicians as the class years mature.
Tax Liability and Payment Issues
Federal and/or state tax liability for paid out bonus funds is the sole responsibility of the technician. Bonus funds will be paid in lump sums only, on or before March 1, following class year maturity.
Interpretation of Program Rules and Conditions
In all matters of rules and conditions requiring interpretations, the decision of the dealership will be final and binding.
The dealership will administer all program details and accrue all bonus funds each pay period to be paid out at class year maturity. Any concerns regarding calculation of an individual’s flat rate hours earned for a pay period must be resolved within 15 days of that pay period. Individuals may inquire at any time regarding their account and receive a statement detailing total flat rate hours and deferred bonus amounts by class year.
Technician Responsibility for Training, Testing, and Proof of Eligibility
It will be the sole responsibility of the technician to be sure that he/she receives the necessary flat rate hours, certification, testing, training, dates of testing, deadline dates, or any other information necessary to satisfy the program rules and conditions. It will be the sole responsibility of the technician to provide proof of required certifications to participate in the Career Builder Program. The dealership will not be responsible, in any way, for a technician failing to meet any of the Career Builder Program rules and conditions.
I have carefully read and understand the Career Builder Deferred Bonus Program. I understand the responsibilities and requirements expected of me. I also understand that this program does not constitute a contract of employment nor alter my status as an at-will employee. I have the right to terminate my employment at any time for any reason and the dealership has the same right.
Want More Ideas From our 20 Group Members?
Now, you too, can access some the best ideas from the most successful dealerships in North America. In our Best of 2019 Idea Book, you will learn how to improve new and used vehicle sales, administration policies and procedures, approaches to developing a high-performing dealership, and a whole lot more!
Claim your copy of the NCM Associates 2019 Idea Book today.