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Using Labour Guides

A very useful tool for calculating how long a job takes and what to charge for it.

A service advisor creates a customer estimate using a labour guide that suggests 2.3 hours to remove and replace a part. They add .2 because of the vehicle’s age. Now the estimate is 2.5 hours multiplied by their labour rate.

The technician does the job in two hours. Is it moral and ethical to still charge the 2.5 hours? Many in this industry say yes, and have various justifications for it—some logical, some not so logical. But many in this industry would cut the invoice back to the two hours, including shop owners. Obviously, the consumer wants the lesser of the two times, and some sit in our waiting rooms timing our technicians.

I’m finding that very few shop owners, technicians, and service advisors have had any training in how to use a labour guide. Because most shops now use digital labour guides and the instructions on how to use them are non-existent or hard to find, our industry has lost its way. I found some scans and pictures of the opening pages of some older book labour guides. Each of the well-known brands of labour guides has four-to-five pages at the opening of the book explaining how to use it.

Just a guide

It’s stated that this book is intended only to be a guide and that the times in this book are ‘not intended to be unconditional’. The editors also explain that extra time needs to be added for rusty or seized fasteners, mud or dirt that needs to be cleaned off. In fact, some brands added what they called a severe service time. They also explain that extended test drives, diagnosis and hazardous waste disposal aren’t included in these times. Advisors need to add extra time for these operations.

The most important feature of this guide (which remains unknown to many in this industry) is technician skill level codes. Each guide uses an A, B, C or A, B, C, D rating for technicians based on skill and experience. “A” is a highly skilled/experienced technician familiar with complex systems and testing equipment. “C” is an apprentice who can remove and replace parts with either verbal or written instructions.

Average skill rating

Many mechanical operations in the guides are rated for a “C” technician. If the time in the guide is 2.5 hours and the apprentice does it in 2.5, they’ve done well. We would expect an “A” technician to finish that operation more quickly because of more experience and a larger tool investment. When we provide an estimate to a customer, the price is the same regardless of the skill level of the technician. We don’t punish the customer when a slower technician works on their car. Likewise, everyone in our society who does something faster and better is respected and usually paid more. See example below:

Re and re Fuel pump time in guide 2.5 hours X Shop hourly rate ($75/hour) = Estimate of $187.50 labour plus part and shop supplies.

Apprentice takes 3.5 hours. 3.5 hours X $53.57/hour = $187.50 plus parts and SS.

Journeyman takes 1.8 hours. 1.8 X $104.17/hour = $187.50 plus parts and SS.

We don’t usually use different labour rates for different skill levels, but I think the labour guides are implying that concept in how they were created. It’s simpler to have one labour time with instructions on how to use it.

Sample work order shows replacing a fuel pump. (Photo: Huw Evans)

Categories : Mechanical

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june, 2021

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