Government fleet employees have been facing frozen pay, furloughs, and cuts to benefits for the past few years. Add this to the fact that government fleets don’t pay as well as the private sector, and you end up with discouraged employees and promising technicians itching for a better opportunity elsewhere.With tight budgets and rigid pay classes, what’s a fleet manager to do?
Not having a lot of money means you may not be able to raise wages across the board. But a little bit of money and a lot of work can help fleet managers motivate technicians in the form of incentive pay for certifications.
Fixing a Broken System
One of the main reasons fleets begin incentive pay is to correct pay imbalances. In some cases, technicians who have been employed by the public agency for a long time are paid the most, even if they are unwilling to get up-to-date technical training. And newer technicians with this training and recognized certifications may be paid less and can’t get pay increases.
Or there may be pay grades and technician classifications that just don’t make sense anymore. That was the case in Pierce County, Wash., before Equipment Services Manager Alan Kies, CAFM, CPFP, changed the pay structure in 2006.
The county had two classifications: mechanic and heavy-duty mechanic. The heavy-duty mechanic was supposed to take care of the more in-depth engine and transmission work, a title likely created at a time when that work was more common, Kies said. In the minds of the technicians, however, it evolved to mean technicians who worked on light-duty vehicles vs. those who worked on heavy equipment.
“We had two pay different pay grades for people doing the exact same work,” Kies said. “When a mechanic was asked to do some work on a piece of heavy equipment, he considered it heavy-duty mechanic work and demanded additional pay even though the work was not the in-depth work that the heavy-duty job description indicated.”
For the City of Milwaukee, Wis., Jeff Tews, CPFP, fleet operations manager, saw incentive pay as a way to provide raises after a salary freeze that began in 2008. He conducted a survey of fleet technician pay and realized the city’s pay for its 56 technicians was near the bottom; even the city’s fire fleet technicians, a separate entity, were paid more, and that department was able to poach his employees.
Tews also had a problem with light- and heavy-duty mechanics with different pay grades: light-duty technicians were paid less, which he and others thought was unfair.
“Technology really had taken off a long time ago, and it was a lot more difficult to find quality mechanics to work on small trucks and automobiles than it was to find a heavy truck mechanic who worked with mechanical controls on their diesels,” he said. “So the work was a lot more technical, yet they were getting paid less for it.”
It was also impossible to pull one mechanic over to the other side temporarily not only because of the pay difference, but also because some of the heavy technicians weren’t knowledgeable enough to work on the cars.
Finally, with the pay scale favoring seniority, the newer technicians were ready to leave. One of them told Tews: “I don’t want to go, but I can’t earn a living, and I’m making a lot less than people who work a lot less than me,” he recalled.
Tews began an incentive pay program in 2013.
Bryan Lucas, fleet manager at Orange County, Fla., had the same problem with low pay — his salary survey within the state showed the county’s technician pay was one of the lowest. Combine that with mass retirement — the fleet had five retirements recently and five more are expected over the next six months out of a technical staff of 45 — and there was a clear need to keep the mechanics who were already there.
“We were trying to raise their pay grades and give them incentive pay for being better educated and staying on top of technologies,” Lucas said. Fleet was able to raise technician pay grades and offer incentive pay in late 2014.
Three Approaches to Incentive Pay
Kies’ goal at Pierce County was to break down the artificial pay barrier and construct something that made sense, and use a third party to make that evaluation.
Certifications from the National Institute for Automotive Service Excellence (ASE) are the go-to solution for many fleets.
Kies decided to structure the incentive program on ASE Master certifications for two series: Automotive, and Medium and Heavy Truck. He would provide half the incentive pay to those who had 50% or more tests passed within a series. Technicians are responsible for keeping up with their certifications, and they can lose their incentive pay if their certifications expire. They’re also responsible for keeping up to date with changes to the program — if ASE adds a test to a series, they need to take it or risk losing their incentive pay.
Twelve of the county’s 19 technicians saw an immediate pay increase as a result of the new program, and nine had the potential to increase their pay with additional certifications. One technician saw a 21% pay increase.
Tews at the City of Milwaukee has a similar structure. He got rid of light- and heavy-duty titles and created vehicle service technician (VST) I and II titles.
VST I had six steps, with an entry-level tech making about 5% more than the entry-level pay under the old system. Technicians can advance through each step by getting ASE certifications and education such as an associate’s degree, capping out with an ASE Master certification.
VST II technicians have seven steps to complete, and start with one ASE Master certification and a minimum of one year of service at the city. Advancement is earned through additional ASE certifications, ASE specialist certifications (L series tests), and additional years of service. VST II maxes out at three years of service, 2 ASE Master certifications, and 2 L-series tests.
During the roll-out period, technicians had a grace period to ramp up their certifications before the end of the calendar year.
“Man, there was a flurry of people taking tests,” Tews said.
The highest pay increase among the technicians was earned by one of his strongest ones: the technician got a 16% pay increase by moving from the top of the previous light technician pay scale to the highest step of VST II.
After that, technicians are re-evaluated Jan. 1 and July 1 of every year. Any technician who loses his certification has until those dates to test for it or go down a step, while anyone who passes more tests has to wait for those dates to get the additional pay.
Those who didn’t have certifications and didn’t want to take them were grandfathered into their old wage, but they’d have to get all the certifications and requirements higher than their pay level in order to make more money.
Rather than increasing hourly pay, Orange County provides a lump sum twice per year for ASE tests passed. Lucas explained that technicians get $104 per test every half year, so a technician who has passed six tests within the Medium and Heavy Truck series (T series) gets a lump sum of $624 twice per year.
Technicians are limited in how many tests for which they can get incentive pay. A Mechanic I can get paid for two tests, a Mechanic II for six, and a Mechanic III for nine.
Right now, the program is available only for the ASE T series and the Emergency Vehicle Technician (EVT) certification. The EVT certification was a “no brainer” since the county fleet services ambulances, and the county chose the T series because it, on a whole, has more heavy trucks, including fire and refuse vehicles that Lucas doesn’t oversee, he said. He’s working to expand this to the ASE A series for automobiles, F series for alternative fuels, L series for specializations, and E series for truck equipment.
Technicians whose certifications have expired at the time of payment don’t receive it. This is much easier for those with ASE certifications to follow, since there is a testing center in Orlando, the county seat. Those with EVT certifications have to take the multi-day training class, which sometimes requires travel, before taking the exam.
This incentive pay comes on top of a pay grade increase across the board after a salary freeze that took effect in 2008. The increase amount varied depending on where they were within their pay grade, but Lucas said most got at least a $1 an hour increase, with many getting a bump of 7-8% and some seeing jumps as high as 12%.
The City of Milwaukee offers tuition reimbursement to pay for ASE tests that technicians pass. Pierce County and Orange County also pay for passed tests as well as test registration fees.
Unfortunately, implementing a new pay scale system is no easy task — it can take years to get the buy-in required from administration officials, Human Resources, unions, elected officials, and finance managers, and to iron out the details.
Kies said the biggest roadblock initially came from Human Resources, which didn’t like the idea of employees moving up and down in classification. The union was happy with it since many technicians were able to get raises, but technicians who didn’t get raises or received small raises weren’t as excited. He also made a new requirement for lead technicians: that they have ASE Master certification. This also faced some pushback, but the county allows lead technicians without the certification one year to obtain it.
The unions representing the Milwaukee fleet employees were also happy with the pay increases. Tews expected more resistance from elected officials, but fleet staff met with aldermen who had the most questions, and they were on board. Technicians themselves were the most skeptical, he said.
“They wanted to know all about the what-if scenarios before they would accept it,” Tews said.
One of Orange County’s bigger challenges was with older technicians who didn’t want to get the certifications and didn’t care about incentive pay. They were worried about losing their jobs after job descriptions were rewritten, but Lucas is working with Human Resources to make sure that doesn’t happen.
Kies said in the nine years since the new pay system has started, only one technician has lost his certification. Now, rather than requesting general training, technicians ask for training in specific topics to keep their certifications current. Kies also believes this new structure helps with recruitment because it provides a clear and attainable career path for entering technicians.
In Orange County, the limited number of certifications eligible for incentive pay, especially since Lucas’ mixed shop has light-duty vehicles as well, means few people have been able to take advantage of it so far. Some technicians have lost their EVT incentive pay, and Lucas plans to send them out for recertification before the next incentive pay period. He hopes to be able to expand incentive pay to other ASE certifications by next October, which should open the program to more technicians.
His ultimate goal is to become a warranty repair shop for FCA, Ford, and GM.
Two years into the new pay plan, the number of certified technicians at the Milwaukee fleet has increased: 26 now have Automotive Master certifications, up from 13; 21 have Medium and Heavy Truck Master certifications, up from five; 17 have dual Master certifications, up from two; 14 have L-1 certifications, up from zero; and 13 have L-2 certifications, up from zero. Twelve technicians who previously had no certifications now have them.
A few people did lose their incentive pay when they let their certifications lapse. Tews said they know it’s on them to recertify.
Tews added that the new pay structure allows him to easily shift resources when needed, reduce overtime hours, improve employee morale, and slightly increase equipment availability. Technician recruiting remains a problem, but technician retention has improved.
“We stopped the bleeding, if you will, with regards to people walking out the door after one to four years,” he said. “I like to think that it was because of the pay plan.”
The technician who wanted to leave because of low pay? He’s still there, as are a few people in the same boat, Tews reported.
He’s hoping incentive pay will eventually allow the fleet to obtain an ASE Blue Seal of Excellence, which requires 75% of technicians to have at least one certification.
Despite the advantages of a pay incentive program, there are some who are hopeless with tests, who fleet managers know are good at their jobs but just aren’t good at academics or don’t like using computers.
To help these people, Tews is pairing them up with those who are Master certified to coach them on test-taking, guide them through the ASE website and practice questions, and show them the reference material they should study.
Costs are Worth It
The Pierce County pay restructuring plan didn’t cost much — the budget for fleet technicians rose 3.3% in the first year of implementation.
“With the pay grade upgrade that we went through, there was [a cost increase], but it was well worth every penny of it,” Lucas said of the Orange County fleet. Costs will probably continue to increase as the incentive program expands, but Lucas welcomes this because highly trained technicians means more efficiency.
“They’ll be able to do their jobs quicker, more efficiently, and get their customers’ products out to them quicker,” he said.