Electrician day rate: why yours should not be a guess

A builder rings you on a Tuesday. He has a fortnight of second fix and he wants to know your day rate. You give him a number, he says fine, and you put two weeks in the diary feeling like you have had a decent week’s work off one phone call.

Then the fortnight happens. You are there at half seven because the site starts at eight. You are supplying your own consumables. You lose a day because the plasterer is not finished and nobody rang you. At the end of it you have worked eleven days for ten days’ money and you cannot quite work out where it went.

A day rate is a useful thing for an electrician to have. It is not a useful thing to guess at, and most sparks guess at it twice over. They guess the number, and they guess what the day actually includes.

What a day rate really is

A day rate is not your hourly rate multiplied by eight. If it was, nobody would ever argue about it.

When you take a day rate job you are selling a block of your diary. For that day you cannot take the kitchen rewire, you cannot fit the EV charger, you cannot do the two domestic calls that would have paid better per hour. You are also taking on the risk that the day does not run as promised, and on somebody else’s site it very often does not.

So the honest way to look at it is this. Your day rate has to cover everything an ordinary working day has to cover, plus the fact that you have handed over control of that day to somebody else.

How to work out your electrician day rate

Start from the same place as everything else: your own numbers.

• Work out what an hour of your time has to earn. A year of business costs plus the wage you want, divided by the hours you can genuinely invoice. If you have never done that sum, do that first, because your day rate hangs off it.
• Decide what a day actually is. Eight hours on the tools? Seven and a half? Does it start when you arrive on site or when you leave the house? An hour of driving each way is two hours of your day gone and it has to be in the number.
• Add what you are supplying. Your van, your tools, your test gear, your consumables, your disposal. If the fixings and the tape come out of your pocket, that is not goodwill, that is cost.
• Add the risk. Site not ready, trade in front running late, access you were promised that never appears, payment at the end of the month instead of the end of the week. A day rate with no margin in it falls over the first time any of that happens, and it happens a lot.
• Then sanity check it against the work you are turning down. If your day rate pays noticeably less than a normal domestic day, you are paying for the privilege of being busy.

The number you get is yours. It will not be the number the spark down the road quotes, because he is not paying your insurance or driving your mileage. If you want the first part done for you, the free Minimum Charge Calculator works out what an hour of your time has to earn, and you build the day up from there.

Put the day in writing before you start

Most day rate arguments are not about money. They are about what everybody assumed the day included. Five lines in a message before you turn up stops nearly all of it.

• Hours. Start and finish, and what happens if they want you there earlier.
• What you supply. Labour and your own tools, or materials and consumables as well.
• What happens if the site is not ready. A booked day is a booked day. If you turn up and cannot work, that day is still paid for, and that needs to be said before it happens, not after.
• Overtime. Past the agreed finish is charged, and say how.
• Payment terms. Weekly in arrears is normal. Thirty days on a day rate is you lending somebody money.

Send that as a short message and keep it. It is not a contract, it is a record, and the day you need it you will be very glad it exists.

When a day rate is a good idea, and when it is not

Day rate work has its place. It fills a quiet fortnight, it is simple, and the cash lands predictably. If you are between bigger jobs or you are building a relationship with a decent builder who will feed you work for years, take it.

Where it goes wrong is when it becomes the business. A diary full of day rate work looks healthy and earns like a job without the holiday pay. You have swapped a boss for a contractor, you are rarely the one talking to the customer, and the work does not come back to you because it was never yours in the first place.

My rule of thumb is simple. Day rate work is fine as the filler, never as the foundation. If it is more than a fair chunk of your year, you want to be putting the same effort into getting your own domestic customers as you put into keeping that builder happy.

When a builder pushes back on your day rate

He will tell you he has got someone cheaper. He might even have. Do not knock money off on the spot, because the day you do that is the day the lower number becomes your rate with him permanently.

Ask what the day involves instead. What time does site open, what is the access, who is supplying materials, how long is the run of work, how does he pay. Half the time the conversation moves off price and onto whether you are the person who turns up, tests properly and certifies it. That is a conversation you win.

If it is only ever about the number, let it go. A builder who buys on price alone will drop you the week somebody undercuts you, and you will have given up your own work to keep him.

Get the number straight

Work out what an hour of your time has to earn. Decide what a day includes. Add what you supply and what you are risking. Write the terms down before you start. That is a day rate instead of a guess, and it takes an evening to sort out for good.

That kind of thing is most of what we do inside My Electricians ToolBox. The sums, the terms, the wording for the awkward phone call, and a few hundred other self employed electricians who have already had it.

So, next builder who asks. Do you know what your day is worth, or are you going to say a number and hope?