OpinionBrokerage

Could losing independent contractor status force brokers to raise the bar?

It might be the best thing that's happened to the industry in a long time
  • Uber is in a lawsuit regarding whether their drivers are independent contractors; it's not a stretch to think that this topic might be visiting our industry as well.
  • It doesn't seem like there is anything on the horizon that is going to limit the number of agents that can get real estate licenses with minimal effort.
  • When you have employees that are managed, measured and held accountable for concrete results, things seem to happen easier than when you're dealing with an independent contractor who, more often than not, has his or her own agenda.

As if real estate brokers didn’t have enough to handle and worry about: Now Uber is in a lawsuit regarding whether its drivers are independent contractors. It’s not a stretch to think that this topic might be visiting our industry as well.

Let’s review where we are as an industry:

  • It doesn’t seem like there is anything on the horizon that is going to limit the number of agents who can obtain real estate licenses with minimal effort.
  • There are way too many companies that don’t hold their agents accountable nor train them — hence, the incredible level of unprofessionalism we deal with regularly.
  • Google, Zillow and other companies continue to get deeper and deeper into the business.
  • Today’s consumer expectation revolves around consistently amazing experiences, which they get from Amazon, Starbucks, Apple and others.

I was speaking at a conference recently where I was asked how brokerages can move forward profitably given all the points I mention above.

Here are two things I wanted that group to take away from my talk:

  1. Accept that those four points are reality and stop fighting it.
  2. Understand you can beat anyone if you deliver the excellent experience consumers expect in every aspect of their interaction with your team.
Devrim PINAR / Shutterstock.com

Devrim PINAR / Shutterstock.com

This brings me back to why treating agents as employees — as scary as that might sound today — might just be the best thing that ever happened to the real estate industry. How many times have you told someone the following: “I can’t force my agents to do that.” Or the old standard: “They’re independent contractors, they do whatever they want.”

To truly deliver an unparalleled, consumer-centric experience, there are a lot of moving pieces to consider:

  • Training
  • Web marketing
  • Accountability
  • Reviews
  • Metrics
  • Follow-up
  • Culture

Are all those pieces are hard to pull together when you are dealing with 20, 50, 100 or 1,000 real estate agents? Of course they are. Otherwise, the industry would have tackled this problem by now.

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When you have employees that are managed, measured and held accountable for concrete results, things seem to happen easier than when you’re dealing with an independent contractor who, more often than not, has his or her own agenda.

Some other things that would happen if we had to treat agents as employees:

  • You won’t hesitate to fire someone who is not producing.
  • Knowing that, more agents will do what you want them to do and become better producers.
  • Knowing that, anyone who is not truly serious will think twice about getting a license.
  • The agents who care about their profession will appreciate others not coming into the business to sully the reputation of their profession.
  • You’ll truly be able to weave together all the pieces that make for an incredible consumer experience.

Every time I have faced adversity and dealt with it head on, I usually succeeded, and it always made be better at what I do.

We need to be better at what we do in this industry, and this might be the issue that forces us to do what we should have done a long time ago.

Jose Perez is the founder of PCMS Consulting.

Email Jose Perez.