Guides
Moving company pay: what is fair and what is sustainable
Moving company employee pay in named variables: base wage, payroll burden, unpaid yard time, and seasonal retention, giving the loaded crew-hour to charge.
What to take away
- The number that matters is not the wage. It is the loaded cost per paid crew-hour, and it is larger than the wage by a factor the yard's own payroll records reveal.
- Pay structure in this trade has to solve two problems at once: keeping good movers through the winter, and not paying for capacity in February that only sells in July.
- Wage, overtime, timekeeping, and recordkeeping are governed by the U.S. Department of Labor and by state law. This page gives typical ranges; the statute and the state rule settle the binding figure.
- Set the wage against published local data first, then against break-even. A wage borrowed from a competitor's job post is guessing at their margin.
- The loaded cost formula is L = W x (1 + B) x (1 + U) x (1 + O x (p - 1)). A worked example at $18 an hour sits under From wage to billable cost.
What drives the loaded crew-hour cost
Loaded crew-hour cost
- W
- Base hourly wage for the role · The offer
- B
- Payroll burden as a fraction of W: employer taxes, workers' compensation, benefits · Payroll records
- U
- Unpaid-to-customer hours per paid hour: yard time, pad loading, travel not billed · Job sheets
- O
- Overtime premium hours as a fraction of total hours in peak weeks · Timekeeping
- L
- Loaded labor cost per billable crew-hour · Derived
From wage to billable cost
Start with the wage and add the burden:
From wage to loaded cost
- W: base hourly wage
- W x (1 + B): add payroll burden
- x (1 + U): add unbilled paid time
- x (1 + O x (p - 1)): add overtime premium
- L: loaded cost per billable crew-hour
W x (1 + B)
B is mostly known. FICA is 7.65% of wages, the employer share of Social Security and Medicare. FUTA is 6.0% of the first $7,000 of wages, cut to about 0.6% by the state credit. State unemployment insurance varies by state and experience rating, typically a low single-digit percentage on a state wage base.
Workers' compensation for moving and hauling classifications commonly runs about 3% to 12% of payroll, higher in the most expensive states. Paid benefits sit on top. A typical crew burden B lands between 0.20 and 0.40.
That is the cost of a paid hour, but not every paid hour is billable. A crew loads pads in the yard, drives to the first job, and waits for an elevator, and some of that time never reaches an invoice.
If U is the fraction of extra paid time per billable hour, the cost per billable hour is:
W x (1 + B) x (1 + U)
In peak weeks some hours carry an overtime premium. If O is the share of hours at premium and p is the premium multiplier the applicable rules set, the peak-week loaded cost is:
L = W x (1 + B) x (1 + U) x (1 + O x (p - 1))
Under the FLSA the premium multiplier is 1.5 for hours past 40 in a workweek for nonexempt employees. Some states use a daily threshold as well.
Worked example. Take W = $18, B = 0.30, U = 0.15, O = 0.10, and p = 1.5. The paid hour costs 18 x 1.30 = $23.40. Spread across billable hours it is 23.40 x 1.15 = $26.91.
The peak-week factor is 1 + 0.10 x 0.5 = 1.05, so L = 26.91 x 1.05 = $28.26 per billable crew-hour. A three-mover crew on an eight-hour billable day carries about $678 of labor before margin.
L is the figure the estimate multiplies by crew-hours. The how to hire reliable staff page describes the evaluation that decides who earns W; this page is about what W becomes by the time it reaches the quote.
Two observations. B and U are both invisible on a job post, and both are why a yard that sets prices from the wage alone is underpricing. And O is a dispatch variable: a calendar that stacks the same crew on consecutive month-end days is raising L for every job on those days.
Pay structure choices
What it solves
- Hourly, all hours
- Simple, fair on long jobs
- Hourly plus per-job bonus
- Pace on surveyed jobs
- Day rate with minimum hours
- Predictable cost per crew-day
- Lead differential
- Rewards the crew lead's responsibility
- Seasonal retention payment
- Keeps good movers through winter
What it creates
- Hourly, all hours
- No incentive for pace; overtime in peak
- Hourly plus per-job bonus
- Pressure to cut corners; the bonus must not reward skipped padding
- Day rate with minimum hours
- May breach wage rules if hours run long; check before adopting
- Lead differential
- Must be paid consistently or it breeds resentment
- Seasonal retention payment
- A fixed cost in the quiet months; only worth it for movers who return
Whichever structure the yard chooses must satisfy the wage-and-hour rules. The U.S. Department of Labor's guidance for new and small businesses sets out the wage, overtime, timekeeping, and recordkeeping duties employers carry under federal law. It is also the place to confirm whether a day rate or a per-job bonus is lawful for hourly movers in your operation.
Whether particular drivers and loaders fall under an overtime exemption depends on the vehicle and whether the work is interstate; ask the Wage and Hour Division rather than assuming. Which drivers and vehicles are federally regulated is covered in the licensing and compliance guide.
The winter problem
Household moving demand clusters in summer and at the end of the month. The fixed cost of a crew that is kept through the winter is paid whether or not there is work. The choices are:
- Keep a core crew year-round at reduced hours, and staff the summer with seasonal hires who run the same evaluation stages.
- Keep a smaller core and pay a retention amount to the best seasonal movers to return.
- Diversify the winter workaccount moves, storage handling, packing services, and labor-only jobs that keep the core crew paid.
Option three is the one the operations and workflow guide favors, because it keeps the method alive in the crew. A yard that rebuilds its crew every spring rebuilds its quality every spring.
Setting W
Two references, in order. First, the Bureau of Labor Statistics wage tables, which publish employment and wage estimates by occupation and metropolitan area, including movers, drivers, and helpers. That tells you what the local market pays.
Typical posted rates for mover and helper roles run from the mid teens to the mid twenties per hour depending on the metro, with crew leads a few dollars above the crew. State labor market information offices publish their own occupational wage data for the same roles, a second check on the metro figure.
Second, the yard's own break-even: the contribution per crew-day at the price the market accepts must cover the fixed cost at the crew-day count the calendar sells. If the market wage produces an L that the local price cannot carry, the problem is the price or the productivity, not the wage.
Wages differ by market, which is one of the hidden costs of a second yard. The expansion and market guide treats the wage table for the new metropolitan area as a required input before the decision.
Fair pay is regulated pay
Pay decisions are employment decisions. The U.S. Equal Employment Opportunity Commission's small business resource center covers nondiscrimination in pay and promotion, records to keep, and notices to post.
A lead differential, bonus, or retention payment must follow stated criteria the yard can show. The hiring and training guide sets out in full the hiring and pay policies that keep the crew through the year.
Common questions
What should I pay a mover?
Read the local wage table, compute L, and check that the price the market accepts covers it at your productivity.
Is a per-job bonus a good idea?
It works when the bonus is conditioned on the job sheet: on time, no claim, checkpoints signed. A bonus paid for speed alone pays for dropped corners.
How do I pay for the yard hours before the first job?
As paid hours, under whatever rules apply to your employees. Whether they are billable to a customer is a pricing question; whether they are paid is not.
Do I need to track hours for a day-rate crew?
Assume yes until the Department of Labor's guidance or a state authority tells you otherwise for your specific operation. Timekeeping is the record every wage dispute is decided on.
