The Conversation Nobody Enjoys

One of the most uncomfortable aspects of running a tuition business is deciding what to pay your tutors. It’s a conversation loaded with tension. Too low and you’ll struggle to attract quality teachers; too high and your margins evaporate before you’ve even covered your overheads.

When I started out, I agonised over this decision. So, what changed everything for me? I stopped second guessing and started asking a simple question.

Let Them Tell You What They’re Worth

During interviews, I now make it a point to ask: “What are your salary expectations?”

It sounds almost too straightforward, doesn’t it? But this single question has saved me countless headaches. Some candidates respond with confidence, citing specific figures based on their experience and qualifications. Others, particularly those newer to tutoring, will default to minimum wage. They’re just grateful for the opportunity and haven’t yet learned to value their expertise.

Here’s what I’ve learned: when someone quotes you a figure, they know what they’re worth in the market. They’ve likely checked other tuition centres, spoken to colleagues, and arrived at a number they feel reflects their value. Sometimes their expectations align perfectly with what you can offer. Sometimes they don’t.

When the numbers don’t match, I don’t immediately dismiss the candidate. Instead, I assess what other options I have. Are there equally qualified candidates willing to work for less? Is this person bringing something unique, perhaps expertise in a specific exam board. These considerations matter.

But here’s the crucial part: asking them gives me invaluable market knowledge. I’m not operating in a vacuum, making arbitrary decisions about pay rates. I’m gathering real data from real people about what the market supports when I engage with them in a conversation.

The Benchmarking Advantage

There’s another significant benefit to this approach. I already know what I’m paying my existing tutors. This gives me an immediate benchmark.

If someone’s asking for £25 per hour and I’m currently paying my similar-level tutors £20, I need to make a decision. Either this candidate brings exceptional value that justifies the premium, or I’m overpaying if I accept their terms. Conversely, if they’re asking for £15 when everyone else earns £20, I know I’ve got room to negotiate upward if needed to secure them. This internal benchmarking has been invaluable. It keeps my pay structure relatively consistent, which matters more than you might think.

Why does consistency in pay rates matter? Tutors talk to each other. When word gets out that you’re paying wildly different rates for similar roles, you could create resentment and instability within your team.

I maintain clear pay bands based on experience, qualifications, and subject demand. This doesn’t mean everyone earns identical amounts as there’s still room for variation, but it means I can justify the differences when questioned.

Here’s how this works in practice: I pay higher rates for tutors teaching GCSE students compared to those teaching primary school children. The economics support this approach. GCSE parents pay premium rates, which means I can justify paying more to the tutor. Primary school tutoring commands lower fees, so tutor compensation adjusts accordingly.

But there’s another factor beyond simple economics: supply and demand in the talent market. Finding qualified tutors who can effectively teach primary school students is relatively straightforward. The technical knowledge required is accessible, and the pool of capable candidates is larger.

GCSE tutoring is different. It demands subject mastery, understanding of exam board specifications, and proven teaching techniques for exam preparation. These tutors are harder to find, and they know their value. The market reflects this reality, and my pay structure must as well.

This tiered approach isn’t about undervaluing primary tutors; it’s about aligning compensation with market realities and business sustainability. When I can justify the difference clearly, based on both revenue and talent availability, it creates a defensible pay structure that most tutors understand and accept.

The Profit and Cashflow Reality

All salary decisions exist within the constraints of business reality. I can’t simply pay everyone what they want and hope the numbers work out. Healthy profit margins matter, but cashflow management matters more. That’s what keeps small businesses alive.

My early mistake was obvious in hindsight: I prioritised appearing professional over financial sustainability. I’d pay tutors promptly on the last day of each month, transferring their earnings with pride in my reliability. Although I would collect payments from parents in advance to help with cashflow management, at times I’d still be waiting for payments from some of our late paying parents to clear their dues.

What changed? I restructured the payment timeline entirely. Instead of clearing tutor invoices at month-end, I began paying mid-month for the previous month’s services. January’s teaching gets paid by mid-February. February’s work is settled by mid-March.

This single adjustment transformed my cashflow position. The added 2 weeks of cash really helped the business. It created breathing room between service delivery and payment obligation.

Sustainable businesses require sustainable cashflow practices. This is especially critical when you’re starting out or running a small operation. You don’t have reserves to absorb cashflow mismatches. Every pound matters. Getting this structure right early prevents the kind of financial stress that derails promising businesses before they’ve had a chance to establish themselves.

Initially the change to the timelines didn’t make sense to the tutors, but they eventually understood the reasons. I’ve found that being transparent helps. When I can’t meet a tutor’s salary expectations, I explain why to help them understand the constraints I’m working within. More often than not, they appreciate the honesty, even if we can’t reach an agreement.

The Non-Negotiable: Invoices and Payment Clarity

Here’s where I’m absolutely rigid: invoices must be issued for every payment. No exceptions. Without proper documentation, I have no defence. Worse, you’re exposing to significant financial and legal risks.

Every tutor receives / or invoices a monthly invoice. This serves multiple purposes. It creates a clear paper trail for both parties. And crucially, it protects both of us if questions arise later.

I also include a specific note in every payment email: “If you wish to query this payment, please notify us within 2 days.” This time limit is essential. It prevents situations where someone comes back months later disputing figures when neither of us can reliably remember the details.

Some might view this as overly cautious, but I’ve seen too many businesses suffer from poor record-keeping. A few minutes spent issuing proper invoices saves hours of potential conflict resolution.

Final Thought

Deciding tutor salaries isn’t a science, it’s an ongoing negotiation between market realities, business sustainability, and fair compensation. Sometimes I pay more than I should because I value consistency. Sometimes I lose good candidates because I can’t afford to pay such high rates.

But by asking the right questions, maintaining clear benchmarks, and ensuring precise documentation, I’ve created a system that works. It may not be perfect, but it’s transparent, defensible, and most importantly, it allows me to sleep peacefully at night knowing I’m treating people fairly while keeping the business viable.

Your tuition business will only succeed if you can attract and retain quality tutors. Pay them fairly, document everything, and never be afraid to have honest conversations about money. The flip side is constant staff turnover and endless administrative headaches that will drain far more than any hourly rate increase ever could.

It’s better to give a raise (within reason), and retain the tutor for consistency, then disrupt operations, and spend more money looking for a replacement and training them up. It’s not worth the hassle. I know not everyone agrees with this approach, but for me consistency in delivery and operations are more important to build a business than just the bottom-line. Your mind will be at peace, and you can focus on other elements of the business that requirement more attention.