Respect the Value of Your Time

Time is money, right?

Well, not entirely. You can spend all your money and go out and make more, but the same is not true of time. You need to guard your time wisely; once spent, it can’t be recovered.

Salaried workers do as much work as necessary to get a stated job done for a fixed annual benefit package including some money, health care, paid time off, or whatever was negotiated as a package before they started work.

In the US, the generally accepted minimum work week is forty hours. For sake of argument, an employee’s salary is considered to be the monetary value included in the employment arrangement. In the US, there is no minimum amount of time off guaranteed to all workers, but many technologists are offered two weeks of employment throughout the year. Neglecting holidays, this means there are roughly two thousand hours (fifty weeks times forty hours per week) in a work year.

So the way to figure out the maximum value of your hour while on the clock at your forty-hour a week job is to take your salary and divide by two thousand. Let’s do an example:

Jane is employed as a back-end developer in Skokie, Illinois for $80k/year. Divide $80,000 by 2000 hours, and we can see that Jane makes $40 for every hour she puts in. Note, the calculation becomes super-easy using the following heuristic: lop off the thousands and divide by two. So if Bob makes $74,589/yr, lopping off the thousands is $74, and dividing by two yields $37/hr. That is the maximum Bob makes every hour during his work week.

Great Info. Now What?

So what have we learned? Well, this is your maximum rate of pay per hour at your workplace. You’ll rarely be sent home after thirty hours in a given week, which would increase your effective hourly pay. How often, however, are you asked to work “a little bit over” to make a deadline? And by “asked” here I mean both explicitly asked, or implicitly asked via culture, or worse through the deliberately vague phrase, “Get it done, whatever it takes.”

How often, however, are you asked to work “a little bit over” to make a deadline?

Because it happens at a fixed dollar amount, any request for overtime from a salaried employee is a request for a voluntary pay cut. Whether requested or insisted, more time at the same rate of pay means less pay per hour. It’s simple math, but employees don’t look at it for what it is, the employer pressing them for more than they agreed to give.

Turn the Argument Around

Let’s look at the conversation if the request was turned around: You walk into your boss’s office (Let’s call him Lorne) one day and say, “Lorne, I have made a grave error in planning, and I don’t want to incur these costs alone. Seems my entertainment budget is 25% short this month. I’m going to need you to increase my hourly wage to compensate.” Sounds crazy, right? But that’s exactly what the company is asking of its workers.

Because it happens at a fixed dollar amount, any request for overtime from a salaried employee is a request for a voluntary pay cut.

We have to give some managers and companies credit, however. There are managers out there that will occasionally give their top performers time off to compensate for their year-round efforts. Those extra days feel pretty good, maybe even well-earned. But do they ever cover the extra time you put in, hour for hour? If not, you’ve taken a pay cut, and of course the company should be grateful for that. They’ve managed to do what you’d never agree to during an annual review, get you to voluntarily take less money per hour of your time.

If your company came to you and proposed to cut your salary by 20%, what would you say?

Working forty hours in a work week in America is not the norm for salaried employees. Employees, especially in technology, are often expected to work 25% more hours, with a 50 hour work week becoming more common or even expected in some places. Well, if you take our example of Jane above, let’s look at what she makes per hour. $80k at 50 hrs/week for 50 weeks gives her an hourly rate of $32/hr. That’s a 20% hourly pay cut! Seriously, if your company came to you and proposed to cut your salary by 20%, what would you say?

Have you already said yes, without realizing it?

Decide When to Say No

I don’t spell all this out for you to advocate taking a hard line and throttling back to 40 hours to the minute. The point here is to be aware of something insidious and subtle that has happened to many employees in Corporate America, something that we’ve all implicitly consented to, possibly without realizing it.

Once you realize what’s really being asked, you start to feel you have options. Is this overtime you’re working temporary? Is there a greater goal that you’re working harder to meet that’s worth the extra effort to you? Will there be a bonus that will compensate you for this extra time? Is this extra effort needed to enable you to get that next promotion? Once you recognize the request for what it is, you’ll be able to ask how to compensate for it, or even turn down the request.

Once you recognize an overtime request for what it is, you’ll be able to ask how to compensate for it.

If a company culture expects indefinite overtime, and you’re cool with the net effective pay cut, by all means, soldier on. Or decide that the culture is not for you. But be aware. Be educated.

Ask for More Time Off

As we’ve seen, long hours means less per hour, making each of your hours less valuable. During tough economic environments businesses are asked to do more with less. Sometimes during the annual review process, you’ll hear, “I’m sorry, but the business is struggling, and we need to keep expenses fixed,” which indicates that they are not willing to increase your salary. But another way to continue increasing your per-hour compensation is to work fewer hours. Use a positive annual review to ask for a PTO increase. A business may consider this an acceptable way to reward valued contributors.

Try Remote Work

One of the most expensive parts of any employee’s day is the time it takes to get ready and get to the office and home every day. In busy metro areas, it’s not unheard of for the trip to take an hour and a half, every day, each way. These are hours that are needed to work, but aren’t considered part of your day. In most cases you receive zero compensation for that time. Add those hours to the time you spend for your salary, and your hourly rate goes down. Every day you can save that commute, that time getting ready, you increase your effective hourly rate, leaving that time for rest, recreation, or more productivity to your home goals.

But I’ll Get Fired!

If you say no to overtime, you might get fired. That’s true any time that you refuse to do as asked on the job. And I would never advocate doing something foolhardy that would threaten your family’s well-being, but when you look at the difficulty companies are having finding qualified tech workers, and how behind the 8-ball they must be if they’re pressing you for long hours, you have to factor that into your risk calculus. Are they really going to lose you, if you’re otherwise solid?

Move On

Sometimes, companies just run at a deficit. They’re trying to do too much with too little. They’re chronically over-committed and under-resourced. You’re always taking that effective 20% pay cut and can’t seem to find balance. Maybe you need to leave your job.

If your company came to you and proposed to cut your salary by 20%, what would you say?

That’s where we come in — your community around That Conference. We are all here to support you and your life goals. If you are looking for work, you can always check out those companies that sponsor us or have a look at the jobs that organizations post on our site. Or jump on our Slack channel and let everyone know you’re looking; folks frequently talk there about open positions or companies that are looking. Get involved with That Mentor to get advice from people that have been there.

Time is money, right? And knowledge is power. Now you know. Go be powerful.