Written for plumbers, electricians, water heater and heat pump installers, drain and sewer shops, and small multi-trade firms serving homeowners and property managers, with Texas, California, Florida and New York in detail.
The short version
- Check every hour against minimum wage.Flat-rate and commission pay must still cover minimum wage for every hour worked, including drive time between jobs.
- Pay overtime on the full regular rate.For non-exempt techs, hours over 40 in a workweek get time and a half, with commission and spiffs in the rate (As of Oct 2026).
- Put supervised helpers on payroll.Paying them as 1099 subs on your schedule, in your trucks, with your tools is a classification risk. Subs doing plumbing need their own license.
Paying techs flat rate or commission does not switch off wage-and-hour law. The rules below are where shops build up back pay without noticing.
Overtime on flat-rate and commission pay
Non-exempt techs get time and a half over 40 hours in a workweek, with commission and spiffs included in the regular rate. Flat-rate or commission-only pay must still meet minimum wage for every hour and pay overtime on the regular rate. California also requires daily overtime over 8 hours. As of Oct 2026.
Fair Labor Standards Act; Cal. Lab. Code sec. 510
California piece-rate pay
Techs paid per task or flat rate must be paid separately for rest and recovery periods and other nonproductive time, shown on the pay stub. As of Oct 2026.
Cal. Lab. Code sec. 226.2
Time that counts
Travel between jobs during the day is work time. On-call time at home is not, if the tech can use it for their own purposes. A take-home truck commute is generally not work time if it is within the normal commuting area and agreed. As of Oct 2026.
29 C.F.R. secs. 785.38 and 785.17; Portal-to-Portal Act
A sub doing plumbing, gas or electrical work needs its own license, and paying a supervised helper as a contractor creates classification risk under your state's test, with payroll to correct and back exposure to quantify.
Workers' comp and hiring
- Classify payroll correctly for workers' comp: NCCI code 5183 for plumbing, 5190 for electrical wiring inside buildings and 5537 for HVAC. California uses WCIRB codes.
- Texas lets private employers opt out as nonsubscribers, at the cost of their common-law defenses.
- In California, as of Oct 2026, workers' comp is required for C-20 licensees now and for every CSLB licensee from January 1, 2028.
- As of Oct 2026, complete Form I-9 within 3 business days of the start, and Florida private employers with 25 or more employees must use E-Verify.
- Drug testing follows state law and DOT rules for CDL drivers. Have a written policy before you test.
- Apprentices: use a state-registered apprenticeship program, follow the board's supervision rules and document licensing hours for the apprentice's own exam.
Before a sub starts
- A license lookup on the board's site.
- A certificate of insurance naming you as additional insured.
- Proof of workers' comp or the state exemption.
- A W-9.
- A written subcontract with scope, price and lien waiver terms.
Talk to an employment attorney before you change any pay plan, and have counsel recalculate any back pay.
Asked in Greymill
The techs. Flat rate does not switch off wage-and-hour law.
Drive time between jobs during the day is work time, so count it.
Minimum wage: every hour must earn at least that.
Overtime: non-exempt techs (covered by overtime rules) get time and a half over 40 hours in a workweek (As of Oct 2026).
Commission and spiffs (sales bonuses) count in the regular rate.
At about 50 hours, that is about 10 overtime hours each a week, more if the 50 leaves out drive time.
The helpers. On your schedule, in your trucks, with your tools, they may count as employees under your state's test. Put them on payroll, under a licensee's supervision.
Before you change any pay plan, talk to an employment attorney and have them recalculate any back pay.
Want a checklist for that meeting?
Ask it about your own business
Paste this into Greymill with your own figures, and Staff & HR works it through for your business.
I run a plumbing, heating or electrical business in [state], in the US. My techs are paid [flat rate, commission, hourly or a mix], work about [hours] a week, are on call [how often] and take trucks home [yes or no]. I also use [number] helpers paid [how]. Check our pay plan against federal and state overtime, minimum wage and work-time rules, flag any classification risk, and tell me what to fix first.
More for plumbing, heating and electrical in the US
- My flat-rate book came from a competitor: is it paying after drive time and callbacks?Flat-rate prices only work if the hourly rate inside them is built from the hours your techs actually sell, not the hours you pay.Read the lesson
- Service pays at the truck, warranty companies and GCs pay late: can I afford another truck?Service work pays on the spot, but installs, home warranty companies, property managers and commercial pay apps do not, so plan cash by the week and test any new loan against what is left.Read the lesson
- Do I charge sales tax on this repair? Why the same job is taxable in one state and not the nextWhether a plumbing or electrical job carries sales tax turns on the state and on whether it repairs or improves real property, and a wrong guess can build up for years.Read the lesson
- Who can pull the permit, and what happens if a helper runs the gas line?The license holder of record carries the work, so who does the job, who pulls the permit and who supervises decide whether you keep the license and can enforce the contract.Read the lesson
- How much can I take up front on a home job, and when can the customer cancel?Down payment limits, cancellation rights and required contract wording all change by state, and getting them wrong can mean refunds, misdemeanor charges or license discipline.Read the lesson
- Selling the replacement at the kitchen table: options, financing and what I can claimPresent replacements as clear priced options with honest financing, and know the rules on dealer fees, fear selling and reviews before you start.Read the lesson
- A customer says my work flooded their house months later: what do I do?When a leak or failure is blamed on your work, report it, keep the evidence and watch the deadline on any defect notice, or you can lose the right to fix it first.Read the lesson
Open the interactive lesson · Every plumbing, heating and electrical lesson · What Greymill knows about the trade
Sources
The primary sources behind this lesson, checked Oct 2026.
- 29 C.F.R. part 778 (People: techs, pay rules and comp)
- Lab. Code secs. 510, 226.2 (People: techs, pay rules and comp)
- 29 C.F.R. 785.38, 785.17 (People: techs, pay rules and comp)
- Scopes of Basic Manual Classifications (People: techs, pay rules and comp)
- sec. 448.095 (People: techs, pay rules and comp)
- Completing Section 2 (People: techs, pay rules and comp)
- Lab. Code sec. 2781 (Subs, helpers and the license holder)
- sec. 7159.5 (Hard cases: money, CONTRACTS and people)
- Texas Occ. Code ch. 1304; TDLR provider registration and financial security (Hard cases: money, CONTRACTS and people)
- secs. 17600 to 17606 (Hard cases: money, CONTRACTS and people)
- 12 C.F.R. 1026.4 (Hard cases: money, CONTRACTS and people)
- Agency page: next review 2032 to 2033 cycle (93rd Legislature); H.B. 636 (2021) continued the board; S.B. 1659 (2023) moved the sunset date (Licensing: plumbing, gas and electrical in texas, california, florida and new york)
- Occ. Code ch. 1301; board rules 22 Tex. Admin. Code part 17 (Licensing: plumbing, gas and electrical in texas, california, florida and new york)
- Occ. Code ch. 1305 (Licensing: plumbing, gas and electrical in texas, california, florida and new york)
- Classifications (Licensing: plumbing, gas and electrical in texas, california, florida and new york)
- Cal. Bus. and Prof. Code sec. 7048(a) to (c); Stats. 2025 ch. 67 sec. 12 (AB 1170), effective January 1, 2026 (Licensing: plumbing, gas and electrical in texas, california, florida and new york)
- Cal. Bus. and Prof. Code sec. 7068.2 (Licensing: plumbing, gas and electrical in texas, california, florida and new york)