If you’ve driven a tractor enough times, you know that eventually you break something. In vineyards, this is often door glass. There are end posts, line posts, cross arms, wind, low visibility, etc. – lots of things that glass tends not to agree with. When operating large numbers of tractors, it is bound to happen now and then. Maybe one to three a season. Accidents happen. They cost some money. We fix it. We move on.
In Napa, I had some employee turnover as I took over the vineyard management company. Mostly good turnover, which allowed me to promote better employees to better positions. One gentleman I had the pleasure to have on my team, was Miguel. He was a standout employee who took great pride in his work. Unfortunately, Miguel had not been given opportunities to advance within the company before I came on board. He’d been with the company 6 years and never received a raise nor a new role.
At his previous employer, Miguel had some experience operating a tractor. We recently had an opening for a tractor operator, and I wanted to give Miguel a shot at filling the position. In any role, especially dealing with equipment, we generally start in a 30-day training phase. Miguel would be paired up with another tractor driver and begin driving during the day shift. This meant mowing and light discing, which are both pretty innocuous in terms of tractor work. He performed well during the training period, and we gave him the full-time position. This came with a 40% pay increase for him and a new title with eventual access to benefits.
When that 30-day training phase was over, we simultaneously started fungicide sprays. These were always done at night, for a variety of reasons. When we started our first spray pass, Miguel took part. Each spray pass usually took about 3 weeks to complete across all of our ranches. Once we started, the drivers effectively worked the night shift for spray season.
All was going smoothly the first week. Then, Sunday night I received a text saying that Miguel had broken the tractor door glass on his Kubota. Like I said, it sucks, costs about $750 each time, but it happens. I went to talk to Jaime at 6AM as his shift ended. From my discussion with him, it was clear he turned a corner too tight causing a metal end post to hit the door and shatter the glass. It was clearly an accident, so I talked to him about it and we moved on.
That same week, I received another text on Friday night saying Miguel had broken ANOTHER DOOR on ANOTHER TRACTOR. Looked like we had a problem. I met Miguel at 6AM again as his shift ended and talked through this particular issue. This time, he had the door open and accidentally let the tractor into gear. When it started to move the door caught another end post. $750. It was clear that Miguel was not fooling around, and these were legit accidents. Yet, I can’t have guys breaking $1,500 worth of tractor doors a week. I moved him back to day shift for the following week and told him the next time he had an accident I’d have to demote him and take it out of his pay. He understood, went to the day shift and drove a tractor for two weeks without a single issue. In fact, he was performing work faster and better than most of the other drivers, which is why, after two weeks on the day shift, we moved him back to night shift. I couldn’t figure it out. Maybe it was nerves or something.
Let’s Try This Again
It was a Wednesday night on his first week back on the night shift when I received a text saying he had broken ANOTHER DOOR!?!?! I honestly wasn’t sure what I was going to do. I went to talk with him at 6AM on Thursday. I could tell he was upset, I was upset, and neither of us knew what to do. I told him I would have to demote him, and we would set up a payment plan to pay off the door damages, which now totaled $2,250. That’s a lot of money – he had a wife and three young kids to support. I set the payoff at $50/week and allowed him to work some extra hours during that time so that he didn’t wind up with less take-home pay. He had to work another 5 hours a week. Neither of us liked it, but it seemed fair and reasonable.
And The Reason Was…
About a month into this new plan, Miguel asked for a day off to attend a doctor’s appointment. Something about diabetes or the risk of diabetes. And it clicked. I’ve heard enough chatter to know there can be vision loss with diabetes. I asked him to request a vision test. Long story short, testing revealed vision impairment. Miguel needed eye surgery, which meant he would be unable to work for at least two months. No paycheck, significant medical bills, and an unclear timeline on when he would return to work. And honestly, there was a part of me that wondered if he would just quit and go work for another company. He was a great employee and great person, and I needed every one of those I could keep on board as I turned over the company.
I decided to make Miguel a deal. I told him I would wipe the remaining $2,000 debt off his responsibility and split the cost of his medical needs with him 50/50. I also offered him a no-interest loan for his 50% until he came back to work. We would just set up a payment plan when he got back. He accepted and came back to work after two months. He wound up being a phenomenal employee just as I suspected. Sure, it wound up costing me about $4,500 in all, but that wasn’t the point. The point was that we uncovered a problem that was undiagnosed, resolved it, which eventually placed us in a great situation. It also spawned an entirely new idea for us to take better care of our employees.
See, when I took over the company in 2015, to put it bluntly, all employees were being pretty underpaid compared to the market and comparable companies. The company had been offering loans with no interest to employees as needed. I would get 3 or 4 of these requests a month. It seemed like we were supporting the employees when they needed it. In the two years before I took over, we loaned out about $40,000 each year. Yet, about 1/3 of it generally wasn’t paid back. Employees quit and would not repay. I realized that these folks needed the loans because we were underpaying them. Genuinely. There were times we were almost not making payroll, partly because of so many loans we had issued. We weren’t offering health benefits either, which could have meant our employees were working with undiagnosed health conditions.
I rebooted the plan: to increase pay for all employees. But it couldn’t be immediate. I had to figure out who should stay, and who needed to go. Otherwise, it would be harder to create the turnover needed. In the interim, I designed a loan program that had a $10,000 cap at any point. Meaning we couldn’t carry more than $10,000 in loan balances. This worked pretty well, met all the employee needs, and limited our exposure to being out of cash. In 2015, we carried a loan balance near $10,000 for most of the year. As I started to increase pay across all positions, the requests for loans started dropping. In 2016, we were mostly running a balance of $5,000 for the year and in 2017, we virtually weren’t getting any loan requests except for true emergencies – car broke down, needed a big deposit for moving houses, etc.
Sometimes We Catch a Real Break
What I learned from all this is that my employees have a living wage they needed to survive. I know that all seems obvious, but there it was, all on paper. We weren’t providing them sufficient pay when I took over and the quality of employees we were retaining suffered. When I changed that dynamic, all these other problems vanished, and we were able to retain the better employees and deliver much higher quality work to our clients.
I could have easily looked at it from a different lens. I could have said we didn’t have the money to increase employee pay, meaning we had to pay them less and less leading to poor employee satisfaction, high turnover, poor work quality, and the eventual loss of all our clients. I see companies do it all the time. And maybe that’s the path I would have taken had it not been for Miguel breaking three tractor doors and uncovering a deeper set of problems. While it sucks that it cost me $4,500, I’m grateful for what it taught me in the long run.