Should Home Service Technicians Be Paid Commission?

Should Home Service Technicians Be Paid Commission?
By Joe Crisara, Author of What Should We Do? and Co-Founder of Service MVP

Should a home service technician be paid commission?

It’s one of those questions that can start an argument pretty quickly in the HVAC, plumbing and electrical industries.

Some contractors believe commission creates motivated, high-performing technicians.

Others believe it turns technicians into salespeople and encourages them to recommend work customers don't need.

Both sides can point to examples that prove their case.

But I think we're asking the wrong question.

The better question is:

What behavior is your compensation plan actually rewarding?

Because commission itself isn't necessarily the problem.

A pay plan becomes a problem when employees have to choose between doing what's right for the customer and doing what's best for their paycheck.

Every Pay Plan Creates Behavior

Whether you realize it or not, your compensation system is communicating with your employees every day.

Pay strictly by the hour and you reward time.

Pay by the job and you may reward speed.

Pay commission on revenue and you reward revenue.

Pay bonuses around specific KPIs and you reward those KPIs.

None of those things is automatically good or bad.

The danger comes when leadership creates a compensation plan without thinking through the behavior it might produce.

Imagine telling a technician:

“Take all the time you need to thoroughly serve the customer.”

But your pay plan rewards them for running as many calls as possible.

Which message do you think eventually wins?

Usually the paycheck.

Commission Doesn't Automatically Create Dishonesty

Let's get something out of the way.

Paying a technician commission does not automatically make that technician dishonest.

There are plenty of commission-based home service professionals who care deeply about their customers.

And there are hourly employees who provide terrible service.

Character matters.

Training matters.

Leadership matters.

Culture matters.

The compensation plan is one part of a much larger system.

But incentives do influence behavior.

That's why we have to be thoughtful about what we're asking people to do.

The Real Danger Is Paying Only for the Outcome

Suppose a technician's compensation is heavily tied to how much revenue they produce.

What happens when they have a slow week?

What happens when their paycheck depends on today's customer saying yes?

What happens when the homeowner chooses the least expensive option?

What happens when the right recommendation for the customer produces less revenue?

And what happens when the homeowner doesn't choose anything today? That doesn't necessarily mean the opportunity is lost. A professional follow-up process can continue helping the homeowner without putting pressure on the technician to force a decision during the original service call.

Now we've created tension.

The technician may genuinely want to do what's best for the homeowner.

But they also have rent.

A mortgage.

Kids.

Car payments.

Groceries.

When someone's financial security depends heavily on the customer's decision, it becomes harder to remain unattached to that decision.

That's exactly why Pure Motive matters so much.

Pure Motive Has to Survive the Pay Plan

One of the foundational ideas we teach at Service MVP is:

Do what's right for the customer without attachment to the outcome.

That sounds simple until the outcome determines your paycheck.

Imagine a homeowner deciding between a $2,000 solution and an $8,000 solution.

If the technician earns substantially more when the homeowner chooses $8,000, can they genuinely present both choices without attachment?

Some people absolutely can.

But why design a compensation system that makes it harder?

A strong pay structure should support Pure Motive—not fight against it.

Don't Pay Technicians to Convince People

This is where I believe home service companies can get into trouble.

If the technician's job becomes:

Convince the homeowner to buy the most expensive thing possible

then we've fundamentally misunderstood the technician's role.

The technician's responsibility should be to:

Investigate thoroughly.

Identify legitimate opportunities.

Understand what matters to the homeowner.

Explain what they found.

Develop appropriate solutions.

Present meaningful choices.

Answer questions.

Help the homeowner make a decision.

And then respect that decision.

Notice what's missing?

Convincing.

The homeowner decides what they want.

The technician makes sure they have enough information to make a good decision.

Pay Attention to What You Measure

Compensation and KPIs usually go together.

That's why leaders need to be careful.

If the only number technicians hear about is revenue, they'll naturally assume revenue is the only thing leadership values.

But revenue is an outcome.

There are important behaviors that happen before revenue.

For example:

Did the technician thoroughly investigate the system?

Did they identify legitimate opportunities?

Did they talk with the customer about what matters to them?

Did they build multiple meaningful options?

Did they explain the differences clearly?

Did they offer financing appropriately?

Did they give the homeowner space to decide?

Did they document deferred opportunities?

Those behaviors tell us much more about the quality of the service process.

We've already talked about why technicians may appear to have a sales problem when they're actually having a discovery problem.

A technician can't present a solution for an opportunity they never found.

And paying a bigger commission doesn't fix that.

What About Hourly Pay?

So does that mean everyone should simply be hourly?

Not necessarily.

Hourly compensation has its own potential unintended consequences.

If employees are paid exactly the same regardless of skill, effort, development or results, your strongest performers may eventually wonder:

Why am I working harder?

You want employees to have an opportunity to improve their financial lives as they become more valuable to the company and its customers.

The question is how you create that opportunity without encouraging the wrong behavior.

That's why I don't believe the conversation should be:

Hourly or commission?

It should be:

What combination of stability, performance and professional development creates the behavior we want?

Reward the Behaviors That Create Great Service

Imagine a compensation philosophy that recognizes more than revenue.

You could consider performance around things like:

Customer satisfaction.

Completed training.

Skill development.

Membership presentation.

Accurate documentation.

Quality control.

Callbacks.

Opportunity identification.

Following company processes.

Individual and team performance.

Not every metric belongs in a compensation formula.

In fact, putting too many numbers into a pay plan can make it impossible for employees to understand.

But the principle matters:

If you want a behavior to matter, don't build a pay system that financially punishes employees for doing it.

Be Careful With Average Ticket

Average ticket is an important business metric.

But it can become dangerous when treated as a technician's entire scorecard.

A higher average ticket doesn't automatically mean better service.

And a lower average ticket doesn't automatically mean poor performance.

Suppose one technician runs five calls where the customers genuinely need relatively small repairs.

Another technician runs five calls involving older systems with multiple legitimate opportunities.

Their revenue should probably be different.

That doesn't necessarily mean one technician performed better.

This is why leadership has to understand the story behind the number.

Your Technicians Shouldn't Decide What Customers Can Afford

There's another compensation problem that can happen in the opposite direction.

A technician may think:

“That option is too expensive. I'm not even going to show it.”

Maybe they don't want to appear greedy.

Maybe they're afraid of upsetting the customer.

Maybe they've personally decided they wouldn't spend that much money.

But that's still making the decision for the homeowner.

If the solution is legitimate and appropriate, the homeowner deserves the opportunity to consider it.

That's one reason we teach technicians to present multiple meaningful choices.

As we discussed in How Many Options Should a Service Technician Give a Homeowner?, the goal isn't to push the customer toward the most expensive option.

It's to give them enough meaningful choices to decide what works best for them.

The technician shouldn't push the customer up.

And they shouldn't push the customer down.

The homeowner chooses.

A Great Pay Plan Should Be Easy to Understand

Here's a simple test.

Ask one of your technicians:

“How do you earn more money here?”

Then listen carefully.

If they can't explain the pay plan, it's probably too complicated.

But pay even closer attention to the words they use.

If the answer is:

“Sell more stuff.”

I'd be concerned.

If the answer sounds more like:

“Get better at my job, take great care of customers, follow our process and produce good results.”

you're probably closer to the right philosophy.

Employees should understand the connection between becoming more valuable and earning more.

Don't Forget the Team

Individual incentives can also create unintended cultural problems.

If every employee is competing for their own paycheck, what happens when someone needs help?

Does the experienced technician help the new technician?

Does one technician willingly give up a call because another employee is better suited for it?

Does the team share what they're learning?

Or does everyone protect their own opportunities?

Home service is a team sport.

Marketing creates the lead.

The CSR books it.

Dispatch gets the right technician there.

The technician serves the homeowner.

The warehouse supports the field.

Leadership develops the people.

Customer service follows up.

One person's revenue number doesn't tell the whole story.

A good compensation structure should recognize individual contribution without destroying collaboration.

Compensation Can't Replace Leadership

There's another mistake I see companies make.

They try to fix performance problems with money.

Technicians aren't producing enough?

Change the commission.

Nobody offers memberships?

Add a spiff.

Average ticket is low?

Increase the percentage.

People aren't following the process?

Add another bonus.

Sometimes incentives can help.

But compensation cannot replace:

Training.

Coaching.

Clear expectations.

Accountability.

Practice.

Feedback.

Leadership.

If an employee doesn't know how to perform the behavior, paying them more when they do it won't teach them.