License Redundancy Incentive Program
Pay employees to get out-of-state licenses and then pay a monthly stipend to hold each license the company actively uses
As Peterman Brothers expanded into Ohio and Michigan, they created a formal license redundancy program. Employees who already live in Indiana are incentivized to take out-of-state licensing exams: the company covers the exam cost and compensates the employee for their time. Once licensed, if Peterman Brothers uses that license to operate in the state, the employee receives a monthly stipend for as long as the license is held. The goal is to maintain three or four licenses in each state the company operates in, never just one or two. This eliminates single points of failure that could pause operations in a state if a key employee departs. The stipend is a small recurring cost compared to the operational risk and recruiting cost of finding a licensed replacement after the fact.
- A license is a single point of failure; two is a backup, three or four is redundancy
- The cost of a stipend is lower than the cost of a forced recruiting sprint after a departure
- Employees who voluntarily get licensed in additional states are demonstrating commitment worth rewarding
- License redundancy is an operational continuity requirement, not an HR expense
- Audit license coverage across all operating statesList every state, every trade, and every current license holder. Flag any combination with fewer than three license holders as a risk. A two-license state is one departure away from a one-license state, which is one departure away from a legal inability to operate.WarningDo this audit before entering a new state, not after. Entering a state and then discovering you cannot find a third license holder is a much more expensive problem.
- Recruit internal candidates for out-of-state licensingAsk existing employees who live near state lines or who have worked in adjacent states whether they are willing to take an out-of-state licensing exam. Offer to cover the full cost plus compensation for exam day. Frame it as a career credential they keep regardless of employment.Pro tipEmployees who already hold an Indiana license often pass adjacent-state exams with minimal additional preparation. The investment per license is small.
- Pay a monthly stipend tied to active useOnce licensed, the employee receives a monthly stipend for each out-of-state license the company actively uses. If Peterman stops operating in a state, the stipend ends. This aligns the cost of the program with the operational value the license provides.Pro tipDefine 'active use' in writing: the company is performing work in that state under that license. This prevents ambiguity about when stipends start and stop.WarningDo not structure the stipend as compensation tied to the employee's primary role. It should be clearly labeled as a license-holding payment so it is understood as a separate arrangement.
A Peterman Brothers employee who has worked in Indiana their whole life takes the Ohio plumbing licensing exam. Peterman covers the exam cost and compensates them for the test day. Peterman is operating plumbing services in Ohio. The employee receives a monthly stipend to hold the Ohio license. If Peterman exits Ohio, the stipend ends but the employee keeps the credential.
Extracted from Owned & Operated ($100M HVAC episode). Chad Peterman described this as a program Peterman Brothers created in late 2025 or early 2026 specifically in response to the multi-state expansion.