Being responsible for job estimate

[shacked]

Ok, thanks to everyone that responded to my last post. Wow, I didn't think I would get that many responses. Since I got a lot of varied responses I will clear this up with a little background about the company I work for.

I work for a small structural engineering company in Southern California. When I say small I am talking about 2 registered P.E.'s including the owner, myself and another engineer, as well as a drafter/designer.

We mainly work in custom residential including shoring systems, and some light commercial.

Now my question:

I have almost 4 years of experience and I am currently studying for my P.E. For the past year when a new job comes in for bid, the owner will give the job to one of us and ask us to tell him how much time we think it will take us, so basically an estimate. He never directly told us that this will be the final estimate that he sends out to the client, as I always assumed that he adjusted the times that we gave him because he has a lot more experience then us.

Well just today he told me that he will start holding us responsible for our estimated time and that if we go over the time we will not get payed for that. Since we are all paid hourly we will basiclly be working for free if this happens.

Now I'm all for this, except I think that with this added responsibility should come added pay....but not in his eyes. All this on top of the fact that I make little more then some people that I know who don't even have a college degree.

Now I can already hear the old guys, "you should be lucky you have a job, or if you wanted a lot of money you should have went into another field...blah blah."

Let me explain my point, so it is clear:
I agree that as a structural engineer we should be professionals and do whatever it takes to get the job done right. Since I am not even a registered engineer I have very little "weight" as to the final structural design of a project. So by putting this added responsibility on us it is a win win situation for the boss. If we estimate too many hours he will chock it up to in-experience and re-evaluate the hours and send out the bid at a lower time. If we are under, then he gets free labor. But how do we benefit besides the increased stress? We will not see added compensation.

Any thoughts would be appreciated.
Thanks

 

[casseopeia]

What your boss is doing is all of the following, in no particular order.

Lazy
Irresponsible
Punitive
A sign of a bad manager
Like have a penalty clause in a construction contract without a bonuns clause...not allowed in most states.

And he is probably violating labor laws.

So when the next job comes along and you have to estimate the time required, triple or quadruple it and then show him how you came in under budget.



"If you are going to walk on thin ice, you might as well dance!"

 

[MikeHalloran]

If you don't mind losing the job as collateral damage (i.e., discharged for something else, possibly synthetic), you can keep records of what you're not being paid, and go to your state's Labor department.

They don't care at all how long you work, or for how low a rate, but if you're being paid by the hour, in the USA, you must be paid for every hour, and they are very serious about that.

I.e. hourly workers do not work for free; it's against the law. Don't tell the boss; he'll make you salaried, and then he _can_ make you work for free.




Mike Halloran
Pembroke Pines, FL, USA

 

[Ron]

I'm an older guy, but you might find it surprising that I agree with you.

Your boss is abdicating HIS responsibility. He should be checking and adjusting times based on his experience. He should also recognize that an estimate to his client might be a "lump sum" or "not to exceed" fee, but he still has to produce his product within those constraints if he contracts to do so. Therefore, he must assume that responsibility, not you. He's being overbearing and greedy and taking advantage of the current economic climate to flog you and your associates.

If he wants you to take the responsibility for lost time, he should pay you accordingly to accommodate those instances.

I consider his approach unprofessional. He's setting it up so that he can't lose, but you can. Might be great in some business people's eyes, but not in mine (and yes, I run a business with only licensed professional engineers...they are not treated that way)

 

[MintJulep]

It sounds like the company bids a fixed price for a job, right?

The flip side of going over budget on hours is estimating too high, and thus bidding too high and not getting the job.

Bonus profit happens when a job comes in under budget.

So, if you estimate conservatively and come in under hours, do you get to keep the excess profit?

Your boss is asking you to take the responsibilities and risks of an owner. The rewards of being an owner should come along with that.

 

[Ron]

Aw come on, Cass....don't sugar coat it!

 

[IRstuff]

Sounds like a perfect recipe for sinking the company. Doing the cost/benefit analysis, it's clear that your proper course of action is to ALWAYS overbid. Then, the company will either lose the business, or you will almost never get penalized.

You should start, if you haven't done so, to keep track of your hours for each and every job, to improve your estimation accuracy. Nothing beats hard data as a basis of estimate.

And yes, your boss is a lazy moron. I guess he's just ready to go on Social Security. A good/decent manager would have at least offered the profits if you come under budget. That would have at least incentivized you to bid close, and work harder.

TTFN

FAQ731-376

 

[PeterStock]

1 Update your resume
2 Network for a new job
3 Report him to the department of labor

You may want to wait until you have a job. While it is illegal to punish you for filing a complaint, if he can show a reason other than the complaint for firing you (or show a lack of work and lay you off) he may be ok.

Peter Stockhausen
Senior Design Analyst (Checker)
Infotech Aerospace Services

 

[pennpiper]

Shacked ,

Here is another approach that you might want to consider.

Meet with the Boss.
Tell him that you are willing to take responsibility for the estimated hours on the following conditions.
He (the boss) must:
1. Allow you access to all of the records for all the projects won and completed during the past four years. This includes the hours estimated for the project and the actual hours used. The number and type of drawings and or documents produced (both developmental and issued).
2. Give you time and support to develop a statistical spread sheet data base for estimating future projects based on the historical records. This Spread Sheet database should reflect the different types and sizes of drawings, the complexity of detail and the degree of analysis and calculations required to produce the different types of drawings. It must also include the amount of field (or on-site) research required to write any job specifications. The data should also reflect the different Clients, types of projects.
3. Recognize that “the best predictor of the future is past performance.”
4. Must tell you if he chose to cut or modify your estimated hours in order to “Win” the contract.

You (and the other workers):
1. Must then do everything you possibly can to meet or beat the estimate while maintaining the same high level quality that has always been expected as a professional and a member of your company.

 

[MechEng2005]

I agree that this is not acceptable. Will you be held accountable if steel prices between your estimate and when it's purchased? Maybe at the moment you are only responsible for the hours, but that may eventually change as well... Also, what about unpredictable situations that arise? Maybe a computer/server crash wipes out a week of drafting.

I think the bigger problem is that this seems to be asking for you to base the quality of your work on the estimate. If you determine you have underestimated a job, there might be temptation to rush through and not put the quality and care you normally would into the design. Of course, this could happen just about anywhere (i.e. one-man engineering firm. He gets a flat-fee contract done faster, he has more profit/hour).

-- MechEng2005

 

[MechEng2005]

Also, I find a fair amount of time for a project goes into meeting with people and correspondance. How would your boss feel if you told him you couldn't meet to discuss the project because you don't have the hours available? Or if the fabricator is not up-to-par and needs everything explained in detail because he can't read a drawing?

 

[Zapster]

I kind of like that plan: All of the risk that comes with being self-employed and none of the benefits. I once worked for someone like your boss. When this manager was placed in an awkward position discussing hours he told me that I was not working enough on my days off. I started laughing at the statement and told him there was nothing to discuss, and that I would provide him a letter of resignation later that day. Where do some of these folks come up this stuff?

 

[CFSEng]

Shacked,
It sounds like it's time to find a new place to work.

Not to sure about S. Cali but I know here in FL finding a job is rough right now. If you are classified as non-exempt which it sounds like you are since he pays you hourly, the federal labor laws (and maybe your state) require you to be paid for ALL hours worked up to 40 hours and 1.5 times your pay rate after that. I think California even requires 1.5 times pay for more than 8 hours in a day. You have to be paid for this time regardless of any agreements you may have, verbal or written (a contract is not legal if it requires something that is against the law). So what you do in the meantime is work your best, estimate to the best of your ability and let him not pay you for hours worked. Then after you find a new job, go the local labor department office, show them your recorded hours worked (copies of what you turn in to your boss), your pay check showing you were not paid for those hours and you will get paid.

Good luck with your job search.

 

[ajack1]

As long as he actually does not go as far as not paying monies due I like this attitude.

Many years ago when I played rugby we had a coach who let the players dictate how hard we were pushed, this was totally new to me at the time. Some of course set themselves easy targets which he accepted, but others that pushed themselves set higher standards, slowly these became what were required to make the first 15 and it was impossible to moan about being beasted for the standards you had set. The team spirit became fantastic and training and match day became hugely competitive and enjoyable. The team gained promotion for three consecutive years.

I feel exactly the same principles apply here, the ones that just give up or set their standards so low are not what you want in such a small company and the sooner you can get rid of deadwood like that the better. Those that push the barrier will ultimately make the company stronger and get the rewards.

 

[dgowans]

As long as he actually does not go as far as not paying monies due I like this attitude.

Can't say I agree with you here. If the boss does not follow through with his new policy of not paying the employees for any time worked that is over the estimate, he will lose what little credibility he has left.

If he does follow through with the policy he is breaking the law.

This is a lose-lose, in my opinion. I'm all for motivation, team spirit, pushing each other to be better, etc. but this tactic isn't the way to achieve that.

 

[ScottyUK]

ajack,

I was following your logic right up until you said "...and get the rewards.". What rewards are you thinking of - getting paid for doing the work?

If there was some benefit to the employee over and above getting simply being paid then I might agree, but there doesn't appear to be any. An incentive scheme needs to be very carefully constructed for it to be successful - not necessarily 'complex', but well thought out. Badly conceived 'incentive' schemes are the biggest demotivators imaginable, and this sounds like a very poorly considered idea.


----------------------------------

If we learn from our mistakes I'm getting a great education!

 

[ajack1]

Dgowans, I do not agree you do not need a loaded gun pointed at your head to find out how you would react, you only need to really believe that is the case. Ask anyone who has trained with special armed forces if they think a situation lost credibility when it turned out to be different to what they thought.

Scotty yes in the short term it probably would only mean being paid and keeping your job and whilst I am aware this might not be much of an incentive for someone in your sector that is not true across the board.

Medium to long term however it sets the standards and will make the company more profitable and able to reward its employees both financially and in terms of working in an enjoyable and challenging environment.

Personally I love being pushed and challenged and even for the same money I would choose this every time over sitting around clock watching and just going through the motions. I do realise however that not everyone is the same and this strategy would probably not work in a larger organisation, but I still think it is a good one.

 

[MortenA]

I will agree with IRstuff -always do your best but start to overbid! Your boss should be bright enough to realise this. And the tip about discussing each bed with him is also good.

ajack1 there are lots of volenure orgs. that would like people to work for free - and they are open about it!

Best regards

Morten

 

[CFSEng]

This deal is what you call a win-lose. The boss always wins and the employee loses. We all know this is not the best type of agreement. To make it a win-win, if the project comes in under budget, the engineer needs to be paid for those hours not worked as a bonus. So a project with 100 hours of time estimated gets done in 90 hours, the engineer gets a 10 hour pay bonus. This would give incentive to get done on time, and most likely help balance out any of the over budget projects.

I agree with the idea of making engineers make their own estimates of time for projects. Doing this really makes you aware of how and where you are spending your time, I'm just not sure you should hold an EI with 4 years of experience to this requirement. And as I stated before you can not pay him for time worked unless he is classified as exempt.

 

[dgowans]

ajack1,

In my opinion, there's a huge difference between a situation being different from what was portrayed and one's employer losing credibility. The fact that shacked is here asking about this situation leads me to believe that if the boss doesn't follow through with this plan it will cost the boss credibility. In fact, the whole thing will turn out to be nothing more than an empty threat.

Motivate your employees however you see fit. I'll stick to methods that don't involve threats of illegal employment practices, thanks.