Rex says
Money math without the spreadsheet headache. Plug in your numbers and I'll show you exactly where the dollars land.
Try a scenario
Click to load — tweak from there.Inputs
Result
Tech weekly gross pay
$1,440.00
Projected annual pay
$74,880
Loaded weekly cost to shop
$1,756.80
Resulting labor gross margin
70.0%
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How to use this
- 1Enter flag hours produced per week (hrs).
- 2Enter proposed flag rate ($/flag hr).
- 3Enter shop effective labor rate ($/hr).
- 4Enter payroll tax + benefits load (%).
- 5Read your tech weekly gross pay on the right — it updates as you type.
- 6Hit Share to keep the scenario or send it to someone.
About this calculator
Flat-rate pay plans set the flag-hour rate a technician earns per hour of book time produced, distinct from an hourly wage, and getting the rate wrong hurts either the shop (too rich, margin collapses) or the tech (too thin, they leave for a competitor). This calculator takes expected flag hours produced per week and a proposed flag rate to project weekly and annual tech pay, then compares that pay against the labor revenue it generates at your shop's ELR to show the resulting labor gross margin. Use it to negotiate a rate that keeps techs competitively paid — flat-rate techs should generally see their pay scale with efficiency — while keeping the shop's labor margin in a sustainable range, typically 60%+ after the tech's flag pay, payroll taxes, and benefits load.
Worked example
Using the values the calculator loads with:
Inputs
- Flag hours produced per week: 45 hrs
- Proposed flag rate: 32 $/flag hr
- Shop effective labor rate: 130 $/hr
- Payroll tax + benefits load: 22 %
Results
- Tech weekly gross pay: $1,440.00
- Projected annual pay: $74,880
- Loaded weekly cost to shop: $1,756.80
- Resulting labor gross margin: 70.0%
What each field means
Inputs
- Flag hours produced per week (hrs)
- The flag hours produced per week used in the calculation, measured in hrs. Starts at 45 hrs so you have a working example on load.
- Proposed flag rate ($/flag hr)
- The proposed flag rate used in the calculation, measured in $/flag hr. Starts at 32 $/flag hr so you have a working example on load.
- Shop effective labor rate ($/hr)
- The shop effective labor rate used in the calculation, measured in $/hr. Starts at 130 $/hr so you have a working example on load.
- Payroll tax + benefits load (%)
- The payroll tax + benefits load used in the calculation, measured in %. Starts at 22 % so you have a working example on load. Accepted range: 0–100 %.
Results
- Tech weekly gross pay
- Returned as a money amount in US dollars and shown as the headline result. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Projected annual pay
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Loaded weekly cost to shop
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Resulting labor gross margin
- Returned as a percentage. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
FAQ
What flag rate is competitive right now?
It varies heavily by market and specialty, but experienced diagnostic techs in most metro markets command $28-$40+ per flag hour, with master-certified or dealership-trained techs at the top end. Check local job postings for actual flag rates, not just hourly-equivalent averages, since the two aren't the same.
What labor margin should I target after pay plan cost?
60-65%+ after the tech's loaded flag pay is a healthy target for an independent shop, leaving room to cover shop overhead, service advisor pay, and owner profit from the remaining labor gross profit.
Should new techs get an hourly guarantee instead of pure flat rate?
Yes, especially in the first 6-12 months. A guaranteed hourly floor with flat-rate upside protects new techs while they build speed, and most states have minimum wage guarantee requirements for flat-rate pay plans regardless of preference.
How does raising the flag rate affect retention versus margin?
A $2/hr flag rate increase on a 45-hour week is about $4,700/year more for the tech, often the difference in a competitive counteroffer, while only costing the shop a percentage point or two of labor margin — usually worth it to avoid the much higher cost of turnover and retraining.
Accuracy and limitations
- Results are estimates before tax, fees, and inflation unless an input explicitly covers them.
- Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.
- This is educational maths, not financial advice. Check anything contractual with the lender or your accountant.
Related tools
Cite this calculator
Writing about this topic? Grab a citation — every link helps keep these tools free.
RevenueLab. (2026). Flat-Rate Technician Pay Plan Calculator. Retrieved from https://www.revenuelab.fyi/toolbox/flat-rate-pay-plan
<p>Source: <a href="https://www.revenuelab.fyi/toolbox/flat-rate-pay-plan" target="_blank" rel="noopener">Flat-Rate Technician Pay Plan Calculator — RevenueLab</a> (2026).</p>
Source: [Flat-Rate Technician Pay Plan Calculator — RevenueLab](https://www.revenuelab.fyi/toolbox/flat-rate-pay-plan) (2026).