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Flat rate mechanic, strange circumstance in Michigan

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  • Flat rate mechanic, strange circumstance in Michigan

    Hello everyone,

    I am a 'flat rate' mechanic for a dealership that buys cars for reconditioning then sale. We also serve the general public for repairs.

    The circumstance is we only do 1 to 5 percent in actual public repairs, everything else is a 'company owned' vehicle.

    Is it legal for us to even be flat rate seeing the company can tell you to not fix the car after spending upwards of a couple hours to inspect and diagnose a vehicle, and then only get paid a half hour at best? We also have to do our own parts lookup and pricing, and based on prices alone the company can deny to repair, sending the car off to auction instead.

    I know the flat rate system can work, when you're dealing with the general public, as they are your customers who need their car repaired, but can the company be viewed as a customer in this situation, not an employer required to pay hourly wage due to the fact they can destroy your supposed earning by a part being a dollar too much?

    The horrible thing is I actually like this company and this people I work with, they just changed over to the flat rate system, and it simply doesn't work for the way business is done, all it does is hurt me and all the other technicians.

    Any thoughts everyone?

    Thanks in advance.

  • #2
    Maybe yes. Maybe no. Bob works 5 hours on a car. We can pay him hourly, salaried, flat rate standard hours or use a bingo machine to randomly generate pay. What federal law says is that Bob is paid at least federal minimum wage of $7.25/hr for all hours worked. In this case, that works out to $36.25.

    Please note that your example let out all information needed to actually answer the question. Flat rate or standard hours or other practices are neither inherently legal or illegal. Re-ask your question using actual numbers and we can answer the question for that specific set of facts.

    Your state is not my state, and I do not now enough of MI law to give a MI specific answer.

    The other question which often is raised is what is an hour worked?
    https://www.dol.gov/whd/regs/compliance/whdfs22.pdf
    "Reality is that which, when you stop believing in it, doesn't go away".
    Philip K. **** (1928-1982)

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    • #3
      If your pay works out to be at least minimum wage for every hour you work or are required to be at work, then your employer is in compliance with the law.

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