Ask HN: Feelings on salary vs. hourly?

https://news.ycombinator.com/item?id=4476969

by j2bax • 14 years ago

5 8 14 years ago

news.ycombinator.com

I work for a small agency (about 16 or so guys). The grand majority of our employees are paid hourly. They get time and a half for overtime. Wondering what other people on HN would prefer. Salary with more flexible time off as long as you stay late when needed, or hourly with time and a half and less flexibility with time off?

lifeisstillgood2• 14 years ago

0. What does the agency do? Which country? Which part of the industry? Remote or onsite?

1 why only some of the employees are salaried - is this a management divide, skills gap?

Usually hourly vs salaried indicates the divide between skills the company thinks are either not core or more easily measured and tracked. If you are salarying people doing the same job as hourly workers then yes expect tension

if you are hiring people in to work on well defined clearly measurable projects whilst salaried empoyees perform other tasks then the divide is understandable to everyone involved

your reasons as a company for this approach are your own, (I am guessing you run a small agency and are using a throwaway) - but your reasons need to be understood and accepted by your employyees - if you can explain the reasons here you will have a better chance of winning everyone over

j2bax• 14 years ago

0. Mostly, we do web game development in the US for larger corps. 98% of employees are onsite.

1. You are correct, currently we pay management salary and everyone else hourly. It was actually only recently that we even moved management to salary per my recommendation and preference to be moved to salary.

I'm pretty new to HN, this isn't a throwaway, should it be?

I'm considering making the suggestion to the owner to move everyone to salary so that our costs are a little more predictable. I understand that taking away time and a half could be a sticking point for some of the guys... We would obviously take this into consideration when figuring salaries.

Personally I feel it might make the work place a little more laid back.

lifeisstillgood2• 14 years ago

Sorry I saw a new account on a sensitive subject - as the man says assumption makes an ass of you and umption...

Are you paying hourly because originally things were uncertain and salaries were a big risk on the founders? If this has changed (good rep, plenty of orders trhough next six months) then maybe salary is the way to go.

My feeling though is salary is only part of a question about sharing and managing risk. Games development is risky and there will be better qualified people here to advise but I would look at how the whole risk/reward is structured - salaried employees take on the bread and butter corporate games, freelancers take the riskier retail with some shared upside? There are many ways to do it but at the moment it sounds that it's in peoples interet to work longer hours rather than ship early.

roguecoder• 14 years ago

I appreciated hourly when I was expected to work over 40 hours a week relatively frequently (if I have a major equity stake it wouldn't matter). That company also billed my time hourly, though, so if I hadn't gotten paid when they were getting paid extra for my effort above-and-beyond I'd definitely have felt exploited.

I prefer to take a salary when I trust the management not to abuse my time. Hourly pay aligns my interests and my boss', but adds friction and effort. Salary is a sign of trust that makes my life easier, but if it means the company expects me to burn myself out it'll end up hurting us both as my productivity suffers and I become resentful.

all_these_years2• 14 years ago

IMHO all depends on the employee's work ethics, the company's work environment, possibilities to learn, autonomy in your work, feeling you do something interesting, etc, etc.

I can offer my situation as an example: I work as a senior lead dev in Rails in a hourly basis (US East Coast). Interesting job with a lot of autonomy, possibilities to learn (there is a complex mix of technologies here). I know it is not easy to find someone with my skills set and I know they are more than happy with my performance. The job is hourly just because that was the initial deal, a 'contract to hire'.

They've just offered me a fixed salary and benefits, but with a lower pay from what I am doing hourly (even if my hours are cap to 8h/day). You know, business side tries to push down. So I am seriously considering to start sending resumes and just leave if I can't continue hourly, just because of the pay cut.

So I think all depends. Flexibility in the hours, if it's possible, is a good thing, but fixed salary has also some advantages (if the salary is attractive): health insurance, benefits, paid vacations,... and you may get a higher degree of identification with the company.

So again, it all depends.

chrisbennet• 14 years ago

Is it really "lower pay" after you total up the benefits? Do you get paid vacation, etc? I agree that the new arrangement probably costs them less, but check the math to be sure.

all_these_years2• 14 years ago

I am a math major, so yes, math checked :), it is still lower. My wife has health insurance, so that is not ann issue (for now). It also happens that they said they have a max salary they decided for engineers, which doesn't apply to the business side. This could be just a negotiation tactic to make me to agree to take the lower salary (I am over that max right now), so I think I'll look what is out there...

Anyway, I think that an hourly rate, strangely, has some good things from the employee's point of view, if you have some value to offer and the job market is healthy. You feel that your commitment is to your work, and that to leave is not such a big deal, less attachment to 'the position', more responsibility to your craft.

brudgers• 14 years ago

Flexible work schedules and hourly pay are not mutually exclusive. Salary doesn't suddenly make an employee more productive. An hourly wage does not make an employee unethical.

I've seen well run firms where everyone including the CEO was hourly. Having a meaningful correlation between wages and workflow was an advantage. It provided data for better staffing. Helped employee moral as well.

Disincentivizing inadequate staffing was seen as a good thing.

Ask HN: Feelings on salary vs. hourly?

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