Performance Pay at Safelite Auto Glass Case Study - 1

Performance Pay at Safelite Auto Glass - Case Study Example The installer’s problem as identified in the PPP was related to the turnover rates. It has been found that the turnover rate of the company has been quite high because the glass installation was a seasonal business. The busy periods were spring and summer and it was found that at this time, the competition for new hires was mounting. However, the demand for the windshield replacement troughed and as a result, the repair shops found it necessary to lay off many of their workers and hire them back during spring and summer. In addition to this, another biggest problem was associated with technicians who were lured by other companies’ offer, which promised to pay them a fraction more than what they were currently receiving. Therefore, as a result, it was evident that the installers were changing their jobs since they were paid a Dollar more an hour and were allowed to take the company’s truck home at night. In order to reduce the turnover rate, Safelite also offered truck privileges for a time being, but then stopped it later. It was a matter of concern for the recruiters in HR with regards to getting technicians from other companies to come to Safelite. After going through the case study, it can be revealed that the Performance Pay Plan was revised for both the managers as well as the technicians. It was decided to pay the technicians according to the piece rate system rather than the wage rate system which was previously being practised. The plan was implemented for the technicians to receive the piece rate for every windshield that they installed. According to this plan, the number of windshields that the technician would install in a week would be accumulated. As a result, the technicians’ pay for the week was decided to be based upon the number of installations. The new plan brought both advantages and disadvantages to the technicians. Previously, the technicians received $10-$12 an hour. However, it was analyzed that according to the new PPP, the technicians would receive $15.22 per hour.