Workshops today can have a mix of employees within the business. You have the PAYG Employees where they are automatically getting taxed and are under all of our terms and conditions and then you have the Contractors that come and go or prefer to work to a contract agreement.
So, how do we pay them and how can we simplify this process?
We discussed this topic with Craig Urlich, General Manager of MSR Collision Group, based in Brisbane Australia. MSR Collision Group has five shops & expressed it is hard enough keeping track of six or eight technicians in one Bodyshop, let alone how many we have in the group across the five different locations.
Craig came to Planning Plus Software in a bid to resolve the issue of Contractor Pay. They had Contractors submitting their invoices each week where it would take normally between two to three HR staff up to three days to complete all the contractor’s payment calculations within the group. This needed to be simplified and needed more accuracy.
When Craig approached Planning Plus, we did not have an immediate solution to the problem however Planning Plus saw this as an opportunity. If MSR were serious about joining the Planning Plus family and bringing all five sites onboard, we would work together to create a solution.
Once we started the conversations, we knew we could build something for them and naturally over the next few months we worked together to come out with the model we have now. It was a lot of work from the development team and there were a lot of challenges within it. However, with a lot of testing we ironed out the bugs and in the end, we found the solution. This model fixed the issue for MSR and is now used full time.
So, how did the Contractors respond when this was introduced, what was their reaction to the fact that you were using software to assist in calculating their pay?
Craig, advised it was a 50/50 take up, some contractors were used to using a similar clock on / clock off system in other repair shops , but they hadn’t actually been paid that way, so it was just a matter of time. They were given a few trial runs, where they could check against their own records – and there were a few teething issues along the way, but these were sorted out working with Planning Plus. Eventually they got to the stage where they checked their records against what we were printing out of Planning Plus and realized that it was more accurate than what we were doing beforehand.
We found this very encouraging, especially on the accuracy because as we know that as a contractor you are paid on what you produce. You want to make sure that if you are entitled to that thirty dollars on that job, you are getting paid your thirty dollars. There were a lot of intricacies as well, because as we know we have supplements that come in as the jobs progressing and we would also have changes to the job overall. A job may start at say $1000 and then it might go up to $1500 and down to $1350 by the time of invoicing.
When we were working with MSR to develop the program, we threw all those conditions back and forth to come up with the solutions that you can run. We now know that bang, this job is closed invoiced, good to pay, or we could even pay a percentage along the way.
It was challenging but we got there and the benefits it brought to the group were huge. What used to take the Admin and Payroll staff three days with three people now takes one person approximately two hours. That is a massive time save to the group.
Not only time saving but the accuracy. When you have additions, deductions, those sorts of things that was more time to process. Now that it can be done automatically as a job is invoiced, Planning Plus is able to go back and check if there is an addition or whether there is a deduction. This suits the contractors as each week it is a lot more consistent.
MSR are now finding that some contractors do not even present their invoicing book anymore, or their jobs list, they are that confident that Planning Plus has this managed. They know what they are getting is what they are entitled to. Now they just hand in a blank invoice book, they are prepared to trust Planning Plus 100%.
That is really encouraging for us at Planning Plus to be able to share this information with our client base, or even body shops that might not be using Planning Plus that are running a mix of contractors and general paid employees – how could we manage those contractors if we decided to give Planning Plus a go.
Now that the contractors at MSR have confidence is the system & everyone is onboard, how is the system presented to a new contractor?
Any new contractor is shown the Planning side of Planning Plus. “We actually interviewed a new contractor this morning” said Craig. He liked the simplicity of it, how you go to the board and see how he gets his work. Then we showed him at the end of the week all he has to do is hand in his invoice book with his ABN. We do a printout and every single Job that he has done is there. This includes all deductions and additions from a month ago, a week ago, all there in black and white.
What is important is the transparency, as that is where the program gains their trust. Their role is also important if they play their part, and their part is basically just having them clock on and off the planning board or having them mark their task complete, this allows the management staff to see, where are we in relation to work in progress? That is also a value add which is the main reason they need to clock on and off, contractors are given a certain amount of space and a certain amount of money is expected to come out of that space.
It is great that we have got the result and things are working, and there’s been some huge time saving benefits to the business.
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