Wage Surplus Plan

This productivity plan has been in place since 1980. The basis of the plan is unchanged but we have slowly improved the base calculation. Originally it was a percentage of sales with a step scale for gross margin - and GUESS WHAT --that worked out to the formula we use to day -- 40% of gross profit is made available to wages.

If we pay more than 40% of gross profit dollars in wage surplus --there is NO claw back - you can keep it. But it is much more fun to have a BASE WAGES that supports a surplus at year end. This plan is designed to be a win-win issue -- most labour management issues tend to be a 'if you win - we must loose' issue .... we think this is a win win ( or is terrible mishandled it could become a loose-loose ).

At most monthly staff meetings we will tell you the year to date wage surplus your store has built up. We can compare to past years to give you a sense of where you are. We also give your manager a PRODUCTIVITY chart --showing how many dollars have been sold for the hours worked. This is MOST IMPORTANT - it helps see if the manager is planning staff hours correctly. If you have lots of idle time -- guess what -- you are burning your year end wage surplus bonus. If you see another company with staff always busier that your store - you are looking at staff who will have more wage surplus at year end.

This plan is a team plan - like the Tigers - you can have bad year with good staff - if is the way you all mesh together as a team.

Wage surplus allocations are set as a percentage of your base wage with some slight adjustments for common sense points ( like have you been there for a full year ). Allocations are reviewed by the office manager and ops manager and final year end allocations are reviewed by other store managers - to ensure fairness. Al staff except the ops manager participate in this plan.

You can have TOO FEW staff - your chart looks wonderful - but your ability to serve the customer will drop. The customer will become disappointed in your store and you will loose sale in the long run.

Another problem --when you know someone is off on vacation or similar and you call in sick - especially when you don't get a replacement - then the staff struggle to handle the level of customer service that keep customers coming back. Remember it is a team effort to make good bonuses.

This bonus comes from not wasting hours --when you go into a store and too many staff are standing around -that kills the bonus. There are times when we are quite - that is the time that great staff do something - from counting stock - cleaning up - solving that problem - or on some occasions - seeing if the manager will let you off early.

It is all common sense.