If you’re thinking of hiring someone into your wedding business, a big question on your mind might be: what should I pay this person? I wish I had a hard and fast rule for this. You need to take a few factors into consideration:
What will this person do?
You’ll want to have a job description. This will help you not only figure out what the requirements and responsibilities of the job but also will help you think about the skill required for the job…. which leads me to the next factor…
What is the education, experience, and skill level of this job?
Employee pay is determined by education, experience, and skill. This is where the adage truly is: it’s business – not personal. Even if it’s your friend, or a friend of friend. You need to look at what they will be doing and how good they are at doing it and pay accordingly. If you don’t really know them that well, you can always increase their pay after 6 months to a year of doing an awesome job.
What we do is not rocket science, nor brain surgery. (This is a good thing for us – because we likely could not afford to pay those wages. I know what most business owners earn in this industry.) I always encourage not being stingy, but also see some RIDICULOUS wages being paid for what some employees really bring to the table in small businesses.
What is the average wage of a similar job in this industry or a similar industry?
This is one that has been VERY helpful to me when I’ve had employees. I’ve looked to see what people are paid in other, yet similar, industries.
Typically, we are hiring entry level employees. If they weren’t seeking employment with you, where might they be working? Would they be working in retail? or a restaurant? a hotel? What would an entry level position pay there?
Here’s an example…
In my stationery business, I typically hired college students with little work experience but had good grades and a solid track record of responsibility. I asked myself: if I didn’t hire this person, where would they be working? The answer (in Seattle) was likely Starbucks. At the time, Starbucks paid a starting rate of $9/hour. I used that as a basis and always added $2-3 more.
Find a job in a similar industry that requires the same level of skill and use that as your base. If you want to reward the person with a bit more than this base, tack on a few dollars. If you can’t match it, but can offer some perks (see below) then take off a few dollars.
What other perks or benefits will this person receive?
The base rate may feel a little high for what you can afford in your business. BUT, you may be able to offer some perks or benefits that larger corporations cannot. These are some fun benefits to consider:
- Free lunch once a week.
- Vacation days for ALL part-time employees. (This is something that Starbucks does offer and I always thought it was really neat when I was a barista in college. I felt very valued even tho I could only work 20 hours/week.) See the end of this post *** for a calculation.
- A monthly “fun day”. (If you have product, it could be a day where employees get to create whatever they want.)
- Consider partnering with a colleague and “trading” benefits. (eg: if you’re a stationer, you could provide a photographer colleague’s employees with holiday cards and in turn, he/she could provide your employees some portrait work for your employees.)
- And… don’t forget the other inherent benefits for small business employees: more flexible work hours, greater degree of decision-making and control over their work, and a varied day-to-day work experience. You aren’t offering a cubicle job and that is very enticing to most people.
My last rule: before you pay someone else, MAKE SURE you are paying yourself! (AND – please, please, please – make sure you know the difference between a contractor and an employee).
What have you found to be helpful when determining wages for an employee? Share your tips in a comment below.
If you’re looking to hire an employee (or get better at managing the ones you have) check out our tools for hiring, training, and managing: The People Plan… HR at your fingertips.
*** How to determine part-time vacation pay:
Figure out what you would pay in vacation (as a company policy) for a full-time year-round job. And, then work backwards with the math. Like this:
3 weeks vacation (if I had a 40-hour/week employee for 52 weeks a year)
divide this by 52 weeks, then 40 hours… like this:
3 weeks / 52 weeks = 0.0577 vacation days per week
.0577 vacation days per week / 40 hours = 0.00144 vacation days per hour worked
So… if the employee has accumulated 800 hours over the span of 4 months, he/she would have:
800 hours x 0.00144 vacation rate = 1.152 vacation days
It doesn’t seem like a lot when you are working with part-time hours at such small increases, but it does add up and gives a nice little perk that not many employers offer to part-time employees.