Salary Negotiation - Paid OT to Straight Salary

Off Topic
21

I went exempt about 4 years ago. I got a 10% increase with it, we get paid straight time after 40 hours, but have to put in a minimum of 6 hours first. We do get paid for the first 6 though, it used to be that we gave them 5 hours free then started with hour-one of OT.

I figured out the break-even point between my old and new salary and where I start to lose money by putting in OT.

We had one guy some years back, he got his degree but nobody wanted to promote him or have him working for them. He made a big stink with HR since the company did pay his tuition. Well, they did promote him. He went from working 75 hours a week (40 + 35 hours at the X 1.5 rate) to the bare-bones 40 like the flip of a switch. Which did not sit well with management and he was one of those who HAD to quit the company. Persona non grata all around.

I think overall the move to exempt is a good one especially with any perks that go with it. Paid cell phone, company credit card, use of company car, etc. With where I now work, if you have a degree that goes with what you do, you practically have a bulls eye on your back and you will eventually be made exempt.

We have one guy in the group with no degree at all. They created a title for him so he gets a higher rate and still gets the 1.5 OT diferential. But I know he makes around $20k less than I do as a base salary. With OT he has to work 400 + hours to be where I am for working no OT.

Rob

22

[quote]angry chicken wrote:
But like I said, big companies are fucking stupid. [/quote]

I wouldn’t use the word stupid, but I tend to agree with your general feelings on the matter, not so much the details.

The bigger the company the more like “government” it gets.

Yes some companies are greedy. But the a lot of the time what is seen as greed by the “boots on the ground” (and I understand WHY it is seen as greed) is really a lot of risk aversion.

For every dollar you (or anyone) makes it actually costs the employer anywhere from $1.30 - $2.00 depending on a whole host of factors. So pay/salary negotiations become a game of finding the sweet spot. You need to pay quality employees what they are worth, but at the point of negotiation, management typically knows what the job entails in more detail and the costs associated with it. Such as training, productivity issues, learning curve, etc.

If you have someone you think is worth 100k, and they are asking for 110k plus insurance, flex time, in house training, child care, gas card and an allowance… they are actually asking for something closer to 200k rather than the 110k in their head.

I forget who said it, but yes, you very much keep good people around, and you keep them as happy as can be. The rub though is as their direct supervisor you have a lot less power in negotiation than that employee knows, the bigger the company it is.

23

[quote]countingbeans wrote:

[quote]angry chicken wrote:
But like I said, big companies are fucking stupid. [/quote]

I wouldn’t use the word stupid, but I tend to agree with your general feelings on the matter, not so much the details.

The bigger the company the more like “government” it gets.

Yes some companies are greedy. But the a lot of the time what is seen as greed by the “boots on the ground” (and I understand WHY it is seen as greed) is really a lot of risk aversion.

For every dollar you (or anyone) makes it actually costs the employer anywhere from $1.30 - $2.00 depending on a whole host of factors. So pay/salary negotiations become a game of finding the sweet spot. You need to pay quality employees what they are worth, but at the point of negotiation, management typically knows what the job entails in more detail and the costs associated with it. Such as training, productivity issues, learning curve, etc.

If you have someone you think is worth 100k, and they are asking for 110k plus insurance, flex time, in house training, child care, gas card and an allowance… they are actually asking for something closer to 200k rather than the 110k in their head.

I forget who said it, but yes, you very much keep good people around, and you keep them as happy as can be. The rub though is as their direct supervisor you have a lot less power in negotiation than that employee knows, the bigger the company it is. [/quote]

Bigger companies really watch their overhead rates, which may be 3-4X the average employee hourly rate. I quote machine shop labor at 90/hour, but we have plenty others that are up around 110-120/hour, possibly higher.

When you have a lot of similar businesses in the same area, the HR heads get together and look at who makes what for a particular position all through the company.

We just had all of our labor classes gone through for all positions in every one of our facilities. So now an “Engineer 1” is the same everywhere. An “Assembler A” as well and so on. Which is probably the best way to do it. Smaller companies do as they feel and salaries are often not aligned with industry standards.

Years ago we had a big down turn in the military aircraft inductry, all those Grumman and Fairchild skilled workers got turned loose in the job market. Those companies had very strict work guidelines and you may be called a “Machinist A” while you worked on a drill press for 20 years. This allowed them to retain a big work force but really did them a dis-service.

Some of these guys were hired in a shop where I worked and almost all of them washed out during their probation period. In this shop, you had to be able to do anything and everything, from the trainee to the highest level of skill.

24

[quote]beachguy498 wrote:

Bigger companies really watch their overhead rates, which may be 3-4X the average employee hourly rate. I quote machine shop labor at 90/hour, but we have plenty others that are up around 110-120/hour, possibly higher.

When you have a lot of similar businesses in the same area, the HR heads get together and look at who makes what for a particular position all through the company.

.[/quote]

This all sounds like “standard costing” to me. Which in reality SHOULD just be a way to measure success/failure and normalize earnings, not a tool to strictly manage by.

Which is part of the problem a bigger the company gets. Once a department gets hung up on working towards a certain measure, that measure becomes the gold standard, and that measure might be bullshit, but there are enough layers of management to insulate the problem to the point where you can’t solve it.

To comment on the rest of your post, this happens in my industry too. The best description I’ve heard is: “When you work for a small business you get a base of knowledge that is 2 feet deep and 100 feet wide.” As in you get experience across many areas and can function at a limited expertise at many things. “And when you work in a large firm you get a knowledge base that is 2 feet wide but 100 feet deep.” As in you are a god damn master at something, but it is a narrow skill set.

Each individual will prefer a different situation. I’m a small firm type of guy, but other really thrive in larger firms.

25

[quote]KBCThird wrote:

Yes, this, a thousand times this. I don’t disagree with Angry, but I do think it’s relatively myopic to think that compensation is equal to - and only equal to - the amount of money you are paid.

You require X number of dollars to pay your bills every month and absolutely cannot go below that, but beyond that what else is important to you? If the company only has a certain amount of money budgeted for the position, that’s it, they can’t go up (well, without pulling it from somewhere else), but they CAN provide other benefits. Maybe 3 weeks of vacation per year instead of 2 would be important to you? The ability to work from home one day a week? Two? A better healthcare package? Company car? Expense account?

Not all of these are applicable to every position, but the list goes on. Don’t sell yourself short, but don’t fool yourself into thinking that money is the only way this company can compensate you.[/quote]

A company car and gas card would help bridge the gap. Gas costs me $400-500 a month and a car payment would be around $600/month; so that’s $12k (and tax free, so more like $16k). They do give year-end bonuses and stock also, but the stock takes 4 years to vest (25%/yr). It all depends on what the offer looks like I guess. It could make sense or it might not. This is a good point you bring up though. This is all very far ahead of where I actually am in the process too, but I want to be prepared.

I was also having a chat with one of my clients (another midstream company, but not the one I’m applying for), and they expressed interest in hiring me at some point in the future (to do basically the same thing).

26

[quote]Steel Nation wrote:

[quote]KBCThird wrote:

Yes, this, a thousand times this. I don’t disagree with Angry, but I do think it’s relatively myopic to think that compensation is equal to - and only equal to - the amount of money you are paid.

You require X number of dollars to pay your bills every month and absolutely cannot go below that, but beyond that what else is important to you? If the company only has a certain amount of money budgeted for the position, that’s it, they can’t go up (well, without pulling it from somewhere else), but they CAN provide other benefits. Maybe 3 weeks of vacation per year instead of 2 would be important to you? The ability to work from home one day a week? Two? A better healthcare package? Company car? Expense account?

Not all of these are applicable to every position, but the list goes on. Don’t sell yourself short, but don’t fool yourself into thinking that money is the only way this company can compensate you.[/quote]

A company car and gas card would help bridge the gap. Gas costs me $400-500 a month and a car payment would be around $600/month; so that’s $12k (and tax free, so more like $16k). They do give year-end bonuses and stock also, but the stock takes 4 years to vest (25%/yr). It all depends on what the offer looks like I guess. It could make sense or it might not. This is a good point you bring up though. This is all very far ahead of where I actually am in the process too, but I want to be prepared.

I was also having a chat with one of my clients (another midstream company, but not the one I’m applying for), and they expressed interest in hiring me at some point in the future (to do basically the same thing).[/quote]

You may have done so before, but can you explain what it is that you do? Obviously discretely.

27

[quote]countingbeans wrote:

To comment on the rest of your post, this happens in my industry too. The best description I’ve heard is: “When you work for a small business you get a base of knowledge that is 2 feet deep and 100 feet wide.” As in you get experience across many areas and can function at a limited expertise at many things. “And when you work in a large firm you get a knowledge base that is 2 feet wide but 100 feet deep.” As in you are a god damn master at something, but it is a narrow skill set.

Each individual will prefer a different situation. I’m a small firm type of guy, but other really thrive in larger firms. [/quote]

Any good process engineer should have a knowledge base 2’ deep and 100’ wide in every discipline save his own. I’ve met more than a few “process engineers” with PhDs in chemical engineering that are dumber than a bag of dead cats and only half as useful. They are experts at whatever it is they did their PhD on, but that tiny sliver of knowledge is only marginally useful throughout the course of designing, building, and operating a $500MM facility.

I’ve met exactly one PhD process guy that wasn’t completely worthless, and he was the most brilliant man I ever met. So obviously there are exceptions.

28

[quote]carbiduis wrote:

[quote]Steel Nation wrote:

[quote]KBCThird wrote:

Yes, this, a thousand times this. I don’t disagree with Angry, but I do think it’s relatively myopic to think that compensation is equal to - and only equal to - the amount of money you are paid.

You require X number of dollars to pay your bills every month and absolutely cannot go below that, but beyond that what else is important to you? If the company only has a certain amount of money budgeted for the position, that’s it, they can’t go up (well, without pulling it from somewhere else), but they CAN provide other benefits. Maybe 3 weeks of vacation per year instead of 2 would be important to you? The ability to work from home one day a week? Two? A better healthcare package? Company car? Expense account?

Not all of these are applicable to every position, but the list goes on. Don’t sell yourself short, but don’t fool yourself into thinking that money is the only way this company can compensate you.[/quote]

A company car and gas card would help bridge the gap. Gas costs me $400-500 a month and a car payment would be around $600/month; so that’s $12k (and tax free, so more like $16k). They do give year-end bonuses and stock also, but the stock takes 4 years to vest (25%/yr). It all depends on what the offer looks like I guess. It could make sense or it might not. This is a good point you bring up though. This is all very far ahead of where I actually am in the process too, but I want to be prepared.

I was also having a chat with one of my clients (another midstream company, but not the one I’m applying for), and they expressed interest in hiring me at some point in the future (to do basically the same thing).[/quote]

You may have done so before, but can you explain what it is that you do? Obviously discretely.[/quote]

Sorry, did not mean to put numbers to it like that.

Process engineer in oil & gas

29

[quote]Steel Nation wrote:

[quote]carbiduis wrote:

[quote]Steel Nation wrote:

[quote]KBCThird wrote:

Yes, this, a thousand times this. I don’t disagree with Angry, but I do think it’s relatively myopic to think that compensation is equal to - and only equal to - the amount of money you are paid.

You require X number of dollars to pay your bills every month and absolutely cannot go below that, but beyond that what else is important to you? If the company only has a certain amount of money budgeted for the position, that’s it, they can’t go up (well, without pulling it from somewhere else), but they CAN provide other benefits. Maybe 3 weeks of vacation per year instead of 2 would be important to you? The ability to work from home one day a week? Two? A better healthcare package? Company car? Expense account?

Not all of these are applicable to every position, but the list goes on. Don’t sell yourself short, but don’t fool yourself into thinking that money is the only way this company can compensate you.[/quote]

A company car and gas card would help bridge the gap. Gas costs me $400-500 a month and a car payment would be around $600/month; so that’s $12k (and tax free, so more like $16k). They do give year-end bonuses and stock also, but the stock takes 4 years to vest (25%/yr). It all depends on what the offer looks like I guess. It could make sense or it might not. This is a good point you bring up though. This is all very far ahead of where I actually am in the process too, but I want to be prepared.

I was also having a chat with one of my clients (another midstream company, but not the one I’m applying for), and they expressed interest in hiring me at some point in the future (to do basically the same thing).[/quote]

You may have done so before, but can you explain what it is that you do? Obviously discretely.[/quote]

Sorry, did not mean to put numbers to it like that.

Process engineer in oil & gas[/quote]
Ok.

I just said discretely because I wasn’t expecting you to get too specific or give out company names etc. and numbers are always a good thing, they help to accurately tell the story

30

[quote]countingbeans wrote:

[quote]beachguy498 wrote:

Bigger companies really watch their overhead rates, which may be 3-4X the average employee hourly rate. I quote machine shop labor at 90/hour, but we have plenty others that are up around 110-120/hour, possibly higher.

When you have a lot of similar businesses in the same area, the HR heads get together and look at who makes what for a particular position all through the company.

.[/quote]

This all sounds like “standard costing” to me. Which in reality SHOULD just be a way to measure success/failure and normalize earnings, not a tool to strictly manage by.

Which is part of the problem a bigger the company gets. Once a department gets hung up on working towards a certain measure, that measure becomes the gold standard, and that measure might be bullshit, but there are enough layers of management to insulate the problem to the point where you can’t solve it.

To comment on the rest of your post, this happens in my industry too. The best description I’ve heard is: “When you work for a small business you get a base of knowledge that is 2 feet deep and 100 feet wide.” As in you get experience across many areas and can function at a limited expertise at many things. “And when you work in a large firm you get a knowledge base that is 2 feet wide but 100 feet deep.” As in you are a god damn master at something, but it is a narrow skill set.

Each individual will prefer a different situation. I’m a small firm type of guy, but other really thrive in larger firms. [/quote]

Big companies have to do anything and everything to be competitive and by now I’ve seen it all. I’ve also seen management so layered that some areas of the business are a miracle that they work.

It comes down to the 10% who do 90% of the work. We get more done by taking informal approaches to problems than if we went through channels. Over the years (been here for a while) there is a core of people that work well together and the dream-team was reassembled about a year ago.

I’ve worked in smaller companies but prefer a big place due to the benefits it offers. No way I’d have such a good retirement coming to me or such a deep benefit package in a smaller place. I’m one of the go-to guys in the company and I’ve worked in many different jobs on my way up. So my bag of tricks is pretty good.

Rob

31

Ok, the story has progressed now. Considering 2 offers:

Job A - higher base salary, possibility of higher bonus, longer commute, anticipating less interesting work

Job B - slightly lower base, higher “regular” bonus, shorter/easier commute, company vehicle, gas card, probably more interesting work

How do you guys factor in the company vehicle when comparing offers?

I would take either one at this point. Both are improvements over my current gig.

32

Company vehicle and gas card are like 10k/year.
Depending on the difference in the salaries, if it’s not too much, sounds like option B is better. Shorter commute = more free time, and more interesting work is always more rewarding, and may help expand your repertoire.

33

I have gone from a 45-minute-to-an-hour-or-more-rush-hour commute to having to negotiate one flight of stairs to get to my coffee pot and another flight to get to my work station. It would take a substantial sum more, or a loss of the ability to make a living without commuting, to get me to commute again. In my book, less driving in rush-hour traffic is a very valuable perk that has a substantial monetary value.

34

[quote]jjackkrash wrote:
I have gone from a 45-minute-to-an-hour-or-more-rush-hour commute to having to negotiate one flight of stairs to get to my coffee pot and another flight to get to my work station. It would take a substantial sum more, or a loss of the ability to make a living without commuting, to get me to commute again. In my book, less driving in rush-hour traffic is a very valuable perk that has a substantial monetary value. [/quote]

x2

I went from an hour commute to downtown Baltimore (695 & 83) to about a 7 minute drive, it’s glorious. I had to be on the road by 6:35 or I’d be stuck in traffic (late). Now I can sleep until 7:45 if I feel like it.

It’s a huge perk I’d hate to lose.

35

Would definitely go with option B dependent upon how “slightly” the less pay is. No wear and tear on your personal vehicle = less maintenance, gas provided, and a shorter commute anyway sounds amazing. If I had that option, I would see whatever personal vehicle I have unless I love it and buy a vehicle that is more of a toy since you will only really drive it on weekends and such

36

[quote]usmccds423 wrote:
downtown Baltimore[/quote]
Disgusting.

37

[quote]Steel Nation wrote:
Job A - higher base salary, possibility of higher bonus, longer commute, anticipating less interesting work

Job B - slightly lower base, higher “regular” bonus, shorter/easier commute, company vehicle, gas card, probably more interesting work

[/quote]

The ONLY advantage of Job A is the money, and even that’s not a given if Job B’s bonuses turn out to be better. Then Job B comes with more interesting work, a shorter commute, a company vehicle and gas card. I’m taking Job B seven days a week and twice on Sundays in this scenario unless there’s a very large gap in the base salaries.

(also, I’m a fellow Pittsburgh native, have lurked on your log awhile)

38

[quote]spar4tee wrote:

[quote]usmccds423 wrote:
downtown Baltimore[/quote]
Disgusting.[/quote]

Indeed. Never again.

39

The only catch to the company vehicle is these times would be if you are getting one because - well, they are expecting you to do a butt load of driving, traveling, etc.
You better clarify as companies really don’t give out cars these days just as a commute vehicle short of C staff.

40

[quote]treco wrote:
The only catch to the company vehicle is these times would be if you are getting one because - well, they are expecting you to do a butt load of driving, traveling, etc.
You better clarify as companies really don’t give out cars these days just as a commute vehicle short of C staff.[/quote]

From what I gather, both jobs have some travel to different sites involved. Company A has pool vehicles to take to site. Company B just lets you keep 'em and drive them home.

Job A is based primarily out of the main office. Job B is based primarily out of an operating facility. Operating sites are generally hard on vehicles, that’s why they provide them.

Just got the offer for Job B today. I’m taking it.