Starting Pay?

Replies to This Discussion

Permalink Reply by Relax & Rejuvenate on December 13, 2012 at 2:48pm

The cost of having an employee  -- these are paid 100% by an employer

 

• 6.7% FICA tax paid by employer on wages AND tips
• 6.0% FUTA (federal unemployment tax assessement) on wages and TIPS
• State Unemployment Insurance taxes - up to 10% depending on state
• Various state employer taxes -- disabilility insurance, state training tax, commuter taxes
• City payroll taxes (SF is a lovely 1%)

20% - 30% total, depending on your state and business history

so if a client tips your employee via credit card, the employer pays out $4 - $5 so the employee can get their $20 tip.

 

And if you are a dollar short or a day late filing your monthly or quarterly taxes to the state, local or federal governments, penalties of up to 20% of the amount due, plus interest and fees are assessed.

 

Insurance costs

 

• Workers compensation -- mandatory for any business with even 1 PT employee. As high as 10%
• Employment practices liability insurance -- don't want the disgruntled ex-employee filing some crackpot claim for discrimination -- minimum cost of a policy is $750
• Liability insurance coverage -- ABMP/AMTA only cover the owner/practitioner. Even if you hire and ABMP insured employee, the EMPLOYER is the one at risk and whom a lawyer will chase. Employees carry no liability -- another protection of being an employee.  At least $350 a year

Benefits

• Health insurance -- employers have to pay at least 50% of a premium, minumum of $100 a month
• Vacation -- one week paid time off is 2% of pay
• Sick time -- even if it is not paid time off, the opportunity cost of lost revenue from having an employee out for even one day can run several hundred dollars

 

 

• ▶ Reply

Permalink Reply by Cassandra Cravens on December 13, 2012 at 11:26pm

 I'm in Michigan and I know that some therapists working for spas and big companies make $10 an hour and often do 4-8 massages a day.  For that much labor I would want significantly more than $10 an hour.  The school where I trained employs therapists.  They charge $40 for an hour massage and the therapist receives $20.  Therapists there can expect between 5-15 clients a week.  They also have a receptionist who runs the intake desk- she does the scheduling, takes payments, runs the phone.  The therapists only responsibilities are seeing clients and maintaining their rooms. The facility uses a linen service and provides linens and massage oil/cream.

The pay should factor the responsibilities of the therapist, your costs, and your profit.  I'm assuming since you are talking about hiring a staff therapist you want someone who will be there during most business hours, whether or not there are clients scheduled.  Perhaps doing paperwork, helping promote on the internet, some sanitation duties, manning the intake desk.  For a big picture view you should consider how many massages you expect your new therapist to do.  How many days will he/she be working, how many hours?  

Have you considered reversing the math?  Figure your costs and the profit you want to make.  What is left is the wages you can afford to pay.  If it doesn't seem like enough, see if you can cut costs or reconsider your profit margins.

• ▶ Reply

Permalink Reply by Gordon J. Wallis on December 14, 2012 at 3:14am

 I work in a spa as an employee and make way more money the ten or twelve bucks an hour.  Those massage therapists are getting ripped off and abused.. I'd rather get a job at Walmart and massage all my co-workers that are  hurting on the side.
Cassandra Cravens said:

 I'm in Michigan and I know that some therapists working for spas and big companies make $10 an hour and often do 4-8 massages a day.  For that much labor I would want significantly more than $10 an hour.  The school where I trained employs therapists.  They charge $40 for an hour massage and the therapist receives $20.  Therapists there can expect between 5-15 clients a week.  They also have a receptionist who runs the intake desk- she does the scheduling, takes payments, runs the phone.  The therapists only responsibilities are seeing clients and maintaining their rooms. The facility uses a linen service and provides linens and massage oil/cream.

The pay should factor the responsibilities of the therapist, your costs, and your profit.  I'm assuming since you are talking about hiring a staff therapist you want someone who will be there during most business hours, whether or not there are clients scheduled.  Perhaps doing paperwork, helping promote on the internet, some sanitation duties, manning the intake desk.  For a big picture view you should consider how many massages you expect your new therapist to do.  How many days will he/she be working, how many hours?  

Have you considered reversing the math?  Figure your costs and the profit you want to make.  What is left is the wages you can afford to pay.  If it doesn't seem like enough, see if you can cut costs or reconsider your profit margins.

• ▶ Reply

▶ Reply to Discussion

• ‹ Previous
• 1
• 2
• 3
• Next ›
• Page