March 16, 2010

Hourly Wage vs. Salaried Wage

As someone who's been an hourly employee over the past year, I would like to bring up a question.

Why isn't everyone paid hourly? The business would save tons of money, and you'd command a higher hourly rate.

I know a business would be nervous about people trying to milk the system and work late just to get paid more. But, wouldn't the money they save on welfare services be worth it? And I know some people would be nervous about the insecurity of an hourly rate over a salaried position. But after these past couple years, I can't imagine anyone's feeling too safe anymore.

Plus, in terms of employee morale, if you have to stay late and work on something, you'd know you were getting paid for it.

I love the motivation that hourly work gives me. Don't tell me why it's not perfect. Tell me why it's not a better system than salaries.


Meghan said...

I'm not totally sure that it would be more cost effective for some businesses. I have several friends who work way more than 40 hours a week (more like 60+) and get paid a salary; if they were to receive an hourly wage - meaning paid overtime for >40 hr/week - they would make a lot more money. I think a lot of companies count on employees putting in more than 40 hrs/week without compensation because they pay salary. If they were to pay hourly, people would either be paid more or be less productive because they'd work less.

Eric Olsen said...

Yeah, I might need to see an economic breakdown to see that it wouldn't work in the interests of a lot of industries/companies.

But, for those that it would, why don't they make the change?

Becky Johnson said...

I am hourly and I love it. For me, it's definitely a benefit. However, currently I'm on this project, instituting our new electronic medical record. This weekend is go-live and I start working some major hours, which means...overtime! Yes, it's not the most beneficial for the hospital, but I definitely feel more motivated and appreciated to get the extra money if I'm asked to work more. Personally, I'm not someone that strives to get over time, I tend not to volunteer for it very often at all. I like my time more than money I guess? So I don't take advantage of the system, but I appreciate it!

Eric Olsen said...

exactly! and here's another question Becky. Well, I don't know if you have anything to compare it against. But, I definitely feel more guilty slacking in an hourly environment than a salaried one.

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