A sub at $85/hour can look expensive next to a $32 wage. Flip the comparison after burden, truck, downtime, and quality risk and the answer often changes. Cost the same ticket both ways before you decide your labor model.
Employee: more than the wage
Use a fully burdened rate (taxes, workers' comp, benefits, PTO) plus travel, vehicle, and overhead hours on the job. Idle time between calls still costs you. Training and callbacks are yours too.
Sub: invoice rate is not the whole story
You skip payroll burden and often skip a truck. You still pay markup if you resell their labor, office time to coordinate, and the risk of their no-show, warranty fight, or brand damage. If you warranty the work to the customer, their mistake is still your callback.
Illustrative same-job compare
| W-2 tech | Sub | |
|---|---|---|
| Labor on ticket | Burdened hours × rate | Quoted sub invoice |
| Truck / miles | Usually yours | Often theirs |
| Idle / training | You pay | You do not (until they flake) |
| Quality / warranty | Direct control | Contract + your reputation |
Run both in the job profitability calculator: employee path with burdened labor + travel + vehicle; sub path with the sub invoice as materials/labor cost and less vehicle if they drive. Compare net and profit per hour, not sticker rates.
When each wins
- Employees — steady volume, brand control, membership density, selling in the home
- Subs — overflow, specialty licenses, peak season, markets where you cannot fill a truck year-round
Mixing both is fine. Mixing them without costing the ticket is how shops "save money" and still miss payroll.
Frequently asked questions
Is a sub cheaper than a W-2 tech on the same job?
Not always. Employees carry burden and idle time; subs invoice a line but shift quality and warranty risk. Cost the ticket both ways.
When do employees win?
Steady volume, brand control, membership density, and selling in the home — when utilization can cover burden.
When do subs win?
Overflow, specialty licenses, peak season, or markets where you cannot fill a truck year-round.
Cost the ticket both ways
Model employee vs sub inputs in the free calculator and keep the option with better net after real costs.