It’s been an interesting experience contracting for this small software development company in Salt Lake City so far. The biggest change from what I’m used to, though, is that I’m paid by the hour now.
Since 1996, I’ve been almost exclusively in salaried positions. The benefits of salary are readily apparent: paid vacations, paid holidays, sick leave, and no “slave to the clock” mentality. There seems to often be a great professionalism amongst salaried employees, a dedication to goal-oriented work, rather than time-oriented “putting the hours in”. And yet… there’s a difference in a bad way, too. There’s a feeling in much of the tech industry that a company “owns” you when you’re on salary, that your time is not your own. Many tech companies abuse this, by working employees sixty-hour weeks for months on end, often without any explicit requirement to put those hours in, but with a whole lot of peer pressure.
Yet here I am, now, paid by the hour. Many hourly employees get the same benefits salaried workers do, including the paid holidays, sick leave, vacations, etc. They simply earn it in a different way, and their paychecks vary according to how many hours they’ve put in. The perspective is very, very different. Maybe it’s because I’m a contractor, too, rather than an employee, that I feel simply very task-oriented. I get in in the morning with certain objectives, and attempt to accomplish those objectives in a timely manner. I prepare regular reports on my progress so that the money invested by my customer is shown to be well-spent. And I generally go home at 5:00 without any compunctions at in the vein of wanting to stay longer “to get the project out the door”. It would seem to be wasteful of the customer’s money to put in sixty-hour weeks when there is no need.
Where do you sit on the “hourly versus salary” question? Which do you, or would you, prefer to get in your profession? Why?
As for me, right now, I’m enjoying the heck out of getting paid by the hour. I dislike the lack of benefits, but I like seeing the $$$ on the paychecks, as they represent “real” effort to me, rather than my stipend for just being a part of the company. Heck, I also feel like my evenings are my own, and I can pick up another gig or two from time to time. I guess I feel a whole lot less “owned” than I ever did as a salaried employee, and I keep thinking that, one of these days soon, I need to really get more into making money in my own business. Of course, other than my technical knowledge and my modest musical talents, it’s difficult to say what I’d make that money in :).
Sammy, to me, is a great example to me of a guy making it work. He’s pursuing a dream with his own business. When you’re just hanging out there, relying solely on your own abilities to bring in the dough, rather than a corporate wage… That just really seems like living closer to the metal. Gotta be a lot of Ramen in there somewhere though.
Hourly
Definitely. Kelly is Salaried.. her entire field is.. and her weeks are rearely less than the requisite 40 hours. Often, they are longer.
As for me, when I get my RN, I will be able to step into a position that is hourly.. but makes a decent wage (Nurses with a little experience can make 60 to 100k a year depending on how much, how, and where they work.)
If I work a holiday or if I work overtime, that’s time and a half.. AND (this is great) if I work shifts that are less popular, I can get additional money per hour. Most jobs that go full time DO offer benefits (McDonalds offers benefits).. so yeah, I understand. Hourly is cool cool beans.
It depends…
If I’m making a good hourly rate and still have flexibility of schedule along with plenty of available hours then great. If I’m stuck working 7-4 in an office with no windows making less than I’m worth then I tend to not feel great about it. On the other side of the coin a salaried position with a flexible schedule, a reasonable work load and a fair salary is great. A low salary with too much work because you’re basically owned by your employer… that stinks.
It depends…
If I’m making a good hourly rate and still have flexibility of schedule along with plenty of available hours then great. If I’m stuck working 7-4 in an office with no windows making less than I’m worth then I tend to not feel great about it. On the other side of the coin a salaried position with a flexible schedule, a reasonable work load and a fair salary is great. A low salary with too much work because you’re basically owned by your employer… that stinks.
Salaried…
I prefer to be salary. I tihnk it is the thought of knowing what i will be making. When i work hourly, i dislike the clock watching to ensure that i am going to get my hours in. The company i work for now has me on a hourly schedule. It was strange since they made there offer in the form of a annual salary, but you have to submit weekly timesheets and the way they work it is if you happen to work under 40 hours, they pull time away from your vacation time to make it equal 40 hours / wk. Fortunate for me that i have not had those issues yet. I consistantly make at least 40, On the plus side of this, if i work a week in excess of 40 they pay straight pay for the additional hours. You see in MD & VA there is a catch-22, If you make over a certain amount hourly you no longer are able to make time + 1/2.
Talk to you all soon…
~Jon
The catch…
The magic number above which you don’t get time and a half for overtime is somewhere around $27.00 an hour. Some obscure figure like five times the then-prevailing minimum wage when the law was made.
You just gave away how much you make: at least $50,000 a year 😉
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Matthew P. Barnson
As i understand it
I thought it had a lot more to do with the type of work you’re doing, whether it is classified as exempt vs. nonexempt.. I know a number of nurses who make over 27.50 an hour and get time and a half for their overtime.
Oops. Did i give it away…
Yes i make more than 55K / year. I find it funny how taboo it is to talk about how much people make. I know i have worked for companies that when i was hired had me sign a non-disclosure agreement stating that i wouldn’t discuss my salary with co-workers.
On A lighter note, I should be recieving my offer letter from the company i will be moving to March 1st. This is the first time that i was able to locate a job befor i was laid off. Yeah me!
Have a great night…
~Jon
National Labor Relations Act
Just an aside, since I noticed this node started getting more traffic lately. It turns out the National Labor Relations Act makes it illegal for employers to discourage or ban discussion of compensation, in all forms, among employees. Such a non-disclosure agreement was not binding, as it was illegal for them to attempt to get you to sign it.
However, knowing the culture discourages such discussion, being an amateur lawyer may make you feel good, but not keep a job 🙂
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Matthew P. Barnson
Another vote for salary
Besides health benefits, there’s 401K matching. Working for a business that allows you to stash pre-tax plus matching into a retirement plan is the biggest earning potential for the retirement fund.
I agree with Paul that getting overworked for low annual salary is bad. That’s a situational deal. Don’t sign an full-time contract if you’re not happy with the offer.
Also, I think the time+1/2 has something to do with union concessions, and Justin does happen to be working in a field with high employer demand and strong labor (read: nurse) union.
Making it work…hmmm…
That last comment about 401k was from me, I hate when I forget to log in.
I just noticed Matt mentioned me in his original post. You have no idea how hard it is to get this thing off the ground. I’ve lost a ton of weight, I’m sick all the time because I don’t get any sleep, and I’m freaking out 24/7. Starting your own business works when there’s other people to help out, otherwise, staring at an industry by yourself without help is tough.
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Sammy G
hey…
Hi Kelly.
She giggled
She giggled as she was holding JJ and said “That’s funny”.
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Matthew P. Barnson
$$$
Getting paid by the hour sucks. No benefits is obviously the biggest issue. But from what you’ve told me. You’re not part of a team. You don’t necessarily fit into the company.
Until a later date when they may want to hire you full time or be done with you, you can’t fit into their company activities and traditions, such as playing hockey or whatever. Counting hours to make sure you got enough in to bring home the bacon is no fun in my opinion. I guess I just like the stability of salary. BTW, it was ’98 when you started working salary.
Christy
definately hourly
This is a brand new sore spot for me. Having recently entered the professional workplace, in the nursing field, I just don’t know how salaried people do it. Unless you have actually been in the nursing field, you have no idea how important receiving an hourly wage is. Watching my dad be forced to work madatory overtime, and not get paid for it (otherwise he gets fired, and who is going to hire and Electrical Engineer @ his age?), is really hard. If I have to stay an extra shift, then so be it, but if I know I won’t get paid for it, what kind of crap is that?! Nurses have a rough job anyway, not to try and blow my own horn, but why make them work under rougher conditions than they have to?
Hear, Hear!
Hey! Another nurse! Cool!
Hope our overtime doesn’t go away.
Hourly I.T. is!
I’m not sure how old this discussion is but I found it while trying to make a decision of salary vs hourly in an IT field. In my situation, I get all the benefits of a salary person, insurance, vacation, time off, and it’s really just a choice of whether or not I want to be explicitly paid for my hours or just in a lump sum.
After reading through your discussion, I’ve realized that I’d be an idiot to work for salary. In fact I even wonder if my boss was trying to pull a fast one on me as I am fairly naive about much of the business world. I know that with my devotion to projects I will work until the job is done and since we work for a contracting industry, my boss gets paid a percentage of how much I work so he has no loss if I work more. The only calculations in his head would have to be, if I have to pay him overtime, do I still make money off of him. And that’s his issue.
Since he’s going to offer me all the benefits of a salaried employee without requiring the non-compensated hard work, I see no other option.
Yes I did listen to the stuff about feeling part of the team and feeling a slave to the clock. But I must be more of a bottom line man.
Thank you very much for the open discussion.
I have to agree with this
I have to agree with this comment, I work hourly for my company and there is definitely a divide amonst salary vs hourly employees. Most of the time one does not feel included, it’s a shame but that’s just the way it is.
My Research on this Issue
I agree with the last two comments. I come from a union family working for a large telephone company, and I worked in that field when I was younger for an hourly wage. Now I am an engineer that has worked as a consultant in the past and currently working for local goverment. When starting out I was salaried with 1.5x for OT. Eventually that became salaried with no OT. The key to wrapping your mind around the differences between hourly and salaried (in my opinion)is to create an extremely detailed spreadsheet (I’m a dorky engineer) to compare multiple jobs and boil them down to a net compensation per hour. I have done this and it is an interesting exercise. Recently I have contacted, and been contacted by, many private consulting firms to become a consultant again. When I compare my job with offers it is surprising to see that professionals can be taken advantage of to such a large degree. My current annual salary is $70,000; to maintain the same net hourly compensation and work the “expected” amount of overtime as a consultant I would need to make an annual salary of $107,000. Far greater than what most firms would offer me. Even if no OT was expected of me I would still need to make about $85,000. This is well in line with what some are offering me however once they get their hooks into you they expect you to work the hours, a LOT of hours. In short, the reason for the large difference in the above salaries lies in other compensation in the form of much greater retirement contributions by my employer, more vacation time, etc. Don’t get taken advantage of, lifes too short. Make sure you make decent net hourly compensation and then don’t settle for less unless your goal is to run the show and you want to sacrafice money by working a lot of hours in the hope of being the big boss man one day (and that position is hard to come by; its a gamble with too many variables, and hard work and hours are not necessarily the deciding factor). I want to end by encouraging everyone to openly discuss their salaries with friends and acquaintances. Don’t get offended with what you find out, but use that information to position yourself.
Hourly Only 🙂
I have to give a kudos on the not feeling “owned”part! I left a career in counseling to work in retail. I was hired as a Store Manager right away! I have a degree and some business training.I loved my salary. The first company I worked for the hours were not that bad. The next two companies however worked me to death. The last two stores required a minimum. of 44 hours during non peak season then a minimum of 6 day weeks with 50 plus hours at christmas and inventory time. I made a decent salary but earned every penny. I missed many of my kids functions because I was chained to the store.If someone was sick injured or quit their shift became my shift! UGH! I had a friend who kept telling me to take an assistant manager position as she had just downgraded herself in the same way! She is happier then she ever has been. I took an assistant job and so far im loving it. I still earn almost the same but none of that excessive paperwork. I do my displays make sure the money is right and help build our brand and team. I never work more then 40 hours and when I do its overtime! The holidays we are open Im paid DOUBLE time! If I have that holiday off Im still paid for it. I have FULL benefits! Im no longer missing most of my kids events. I enjoy being on the sales floor and interacting with my customers not chained to paperwork and corporate BS. I added the additional hours for my last store manager position and the total hours worked over forty in a year were 280.. which would equal an additional 7 work weeks (at 40 hours a week)!!! The additional salary for that is less then 4,000! OUCH! Big Business has always gotten over on middle management but in the case of the Store Manager they sell a naive person on what looks like a decent salary when added up by the hour they are earning very little more then their assistants for giving up so much more of their lives. I also saw a tax break that equaled the difference in my salary versus my hourly wage 🙂 So Im earning the same amount but for less work and hassell!…… Now that is true management 🙂 If your a salary worker they have “bought” you!