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To Employ or Contract: The Challenge of Race Team Staffing

crew1When people discuss the “costs” of racing, an outsider might assume the core of a race team’s ledger may come in the acquisition of the car, or spares, or wildly sophisticated technologies required to keep a team at the cutting edge… and in many ways they’re correct. However, at the base of all this is one massively expensive piece of the puzzle: the staff.

Technology, data, equipment, etc. is only as good as the people who can operate it, and with every nuance that a team invests in, be assured there is always a new requirement on the human element as well.

In the business of racing, there is one wildly varying element to how this is handled: to salary employees vs. hiring people as contractors.

Chevrolet-IndyCar-teamThe benefits and drawbacks of both are fairly mixed. Racing is inherently a business that operates on a calendar unlike any other. A series like the Verizon IndyCar Series technically only has a season that lasts six months, from March through September, and when combined with the fact that the series is heavily regulated in the amount of development allowed on a car, not to mention testing restrictions, there is very little for a staff to do (relatively) during the off-season. The NASCAR Sprint Cup Series, on the other hand, runs a nearly year-round schedule, with Daytona’s “Speedweeks” kicking off in early February and the season running nearly every weekend until mid-November. In the world of professional sportscar, such as the TUDOR United SportsCar Championship or Pirelli World Challenge, you have a season that lasts closer to nine months, however it’s not unusual to see breaks between races of three weeks or more.

So when it comes to staffing, does it make sense to “contract” a team member in and pay them only for the days they’re working, or salary them to ensure a consistent balance sheet and provide some stability for the team.

While we’re not advocating for either direction, below are some of the reasons you see it done.

Why You Contract:

dt.common.streams.StreamServerWhy Teams Like It
Race teams like to contract, put simply, because they pay for what they’re getting. For an IndyCar schedule where there’s six months “off,” or a sportscar schedule where there’s three or more weeks between races, it’s tough to justify keeping everyone on the payroll during this time between. On average, a “standard” mechanic on a team will work between 120-180 days a year for a sportscar or IndyCar team, this way ensures that a team’s budget is put only towards those days. Additionally, contracting with crew members allows you to work to scale, bringing in more people when the project demands it, and scaling back accordingly. It also has a few overhead benefits, namely absolving a team of some payroll and insurance liabilities, plus zero concerns of complaints regarding overtime, vacation pay, etc.

Why Crews Like It

The theoretical benefit of being a contract worker for a race team is the ability to work multiple jobs. It’s not uncommon for a crew member to work for different teams in different series throughout the year, or have a “home” job that they work between races. For those paid well, the alternative is they simply don’t have to work the number of days as someone on salary. As a contractor, they have the freedom to work as much or as little as they choose, and similarly if they keep good records on their expenses there’s potential for tax incentives as well.

Why Teams Hate It

nascar-cup-all-star-2006-the-pit-crew-of-the-1-bass-pro-shops-chevrolet-driven-by-martin-tA team of largely contract workers is inherently over paying for what they’re getting compared to salary. Crew members who work a day rate, almost by definition, charge more than if you divided those days against a salary worker, it’s the nature of the beast. This leaves many team owners to feel as though they’re paying a salary wage, but not getting the “everyday” benefits of a salary worker. For those watching the bottom line closely, this means items like testing, extra days preparing the car, severe crash repairs, etc. come at a higher cost than salary employees, as you’re stuck to a day rate every time something comes up.

Why Crews Hate It

Working as a contract crew member is unstable. Even if you’re secured with a team, there’s never a “real” guarantee on how many days you’ll be able to work, and during large breaks or the off-season you’re not getting paid. A team can also simply not bring you back at any moment, and you’re out of work. It’s tough to hold down a more normal job when you’re traveling to races half the year, so finding the balance is a challenge. Additionally, with no payroll taxes taken out, some crew don’t care for the responsibilities associated with that.

Where It’s Most Common

The most common times you see contract workers are for service areas that can be pooled, or for “extra help.” For example, it’s usual for a team to keep a few core mechanics with a team between races to make sure the car is prepared properly, but the extra manpower required during a race weekend isn’t there, thus giving these extra crew members the title of “fly-in guys.” It’s very common for these weekend-warriors to be brought in for race meetings only on a contract basis. Additionally, a lot of your support services such as PR and marketing, hospitality, or logistics are often contracted with a specialist or small company who handles this for multiple teams at once.


Why You Salary:

Why Teams Like It

nascar-cup-darlington-2012-race-winner-jimmie-johnson-and-the-rest-of-the-hendricks-motorsThe beauty of salary employees is that you can utilize them as much as you need. For teams such as in NASCAR, where the schedule creates an endless demand on the race shop, the benefits of running someone on salary are very large. If you’re employees are on a fixed salary, it means your labor overhead is also fixed, so extra days spent on a car, extra days testing, become a much more absorbed cost. In general, since a salaried crew member is inherently more secure in their job, it theoretically also means you’re more likely to get desirable crew. Should it ever arise, it also makes it easier with government compliance.

Why Crews Like It

In a business with high turnover, teams repeatedly shutting their doors, etc., being a salaried crew member gives the stability a traditional contract member may not have. This is especially true of the off-season, when things can get very slow. Additionally, the convenience of payroll taxes, etc., allow for a more stress-free quality of life.

Why Teams Hate It

Budgets for race teams are so incredibly tight and micromanaged that every dime needs to put to good use. This makes it tough during an off-season to justify a lot of the overhead required, and there’s simply only “so much” work a crew can do. Additionally, you’re paying more in tax liabilities, administrative paperwork, insurance, and generally you simply have more professional responsibilities to a large staff.

Why Crews Hate It

f3000-round-4-spielberg-2002-coloni-motorsport-crew-membersDuring a race-season, the demands put on crews are very high. Long hours, endless travel, few days at home, you name it. The theoretical trade-off is supposed to be a “relaxed” schedule during the off-season, but it’s common for team management to have short memories, often tasking salaried employees with busywork that can be frustrating, and still with demanding hours. It’s not an uncommon story to hear of crew members who’ve had to fix their employers boats, work on their personal cars, even do home maintenance for their boss during the off season.

Where It’s Most Common

For series’ such as IndyCar or sportscar, it’s common to see salary roles exclusively to the higher-end duties. Staff such as team managers, crew chiefs, lead mechanics, engineers, etc. are virtually full-time as it is, so it makes more sense to formalize it. In a sport such as NASCAR, most crew members are employees, with the schedule simply requiring a comparable number of days worked.


An Inconclusive Argument

Ultimately, the decision is up to the individual requirements of a team, and the preference of team owners or managers. In a sport such as NASCAR, it makes a lot of sense, whereas a series like sportscar struggles with the same sort of economies. It’s a fluid business with nuances changing yearly, and if there’s one consistency it’s that it’s never consistent.

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