Is Percentage Pay the Key to Solving the Service Labor Crisis?
The labor market for skilled trades and essential services is under pressure. Business owners across the country are struggling to retain quality workers, manage job site efficiency, and maintain profitability. At Legacy, we believe one of the most underutilized tools for addressing this challenge is a model called Percentage Pay.
This system aligns incentives, rewards efficiency, and transforms how workers view their roles—from hourly labor to empowered ownership.
The Power of Percentage Pay
In our past experiences operating companies in the scaffolding, air quality, restoration, and structural remediation sectors, our team has seen firsthand how this system boosts both morale and performance. Now, as we grow the Legacy portfolio, we’re introducing this model across multiple labor-heavy service businesses.
So, what is Percentage Pay? It’s simple: rather than paying workers hourly, they earn a percentage of the total job value. The faster and more effectively they complete the job, the more they earn—while still protecting the company’s margins.
Why It Works
Incentivizes Efficiency: Workers aren’t just clocking in and out—they’re motivated to finish well and quickly.
Reduces Supervision Needs: With clear incentives, workers manage themselves.
Fuels Recruitment: Good workers seek out high-opportunity environments—and this model creates one.
Boosts Retention: People don’t leave when they’re making more money doing high-integrity work.
Cleans Up Company Inefficiencies: It naturally eliminates waste, time theft, and poor processes.
Real Job Site Example: Crawlspace Restoration Crew
Let’s say a crawlspace remediation job brings in $10,000 in revenue.
After allocating $3,000 for materials and equipment, the remaining $7,000 is available for labor and overhead.
The company keeps a fixed 30% for overhead and margin ($2,100), covering insurance, fuel, back-office, and profit.
That leaves $4,900 available to be paid directly to the crew.
In this case, two technicians complete the job in 1.5 days. Under the Percentage Pay model, they split that $4,900—each earning $2,450 for roughly 12 hours of work. That’s more than $200/hour each, tied directly to efficiency and job performance.
Here’s why this works:
Incentive to work smarter: They didn’t waste time running to the hardware store three times or leaving tools behind.
No need for oversight: With clear incentives and expectations, the crew didn’t need a foreman checking in every hour.
Pride and ownership: They knew that doing it right the first time, efficiently and safely, was in their best interest.
That same job, under a traditional hourly model, might’ve taken longer, required a supervisor on site, and cost the company more in total wages and overhead. Worse, the crew wouldn’t have had any reason to improve next time.
Not Just About the Pay—It’s About the Culture
The model isn't just about dollars and cents. It’s about building a culture of ownership, responsibility, and pride in craft. When paired with a clear mission (such as helping underserved clients or making homes safer), the impact multiplies. Workers aren't just earning—they’re contributing to something meaningful.
Our teams have seen it time and time again: give someone a fair shot to earn more, tie their pay to performance, and they’ll rise to the occasion. Not only does the business grow stronger, but the team grows tighter.
Why This Matters Now
In today's environment of tight labor markets, rising costs, and generational shifts in how people work, companies need creative solutions. Percentage Pay isn’t new, but it’s rare—and it works.
It gives employees the power to earn more based on performance, not seniority or hours worked. It creates clarity and shared goals. It frees up business owners from chasing hours and managing slack. And it improves margins without cutting corners.
As we continue growing the Legacy portfolio, this model will play a central role in how we help service businesses professionalize, scale, and retain their best people. We believe the future of essential services lies not just in better tools and tech—but in better ways to pay and empower the people doing the work.
It’s time to bring ownership back to the front lines.
