The main difference between salaried and hourly paid employees is basically how they get paid for their service. Employees who work on contracts have an hourly pay for every hour they perform their job and they have the right to do overtime and earn some extra money. On the other hand, salaried employees are not generally eligible for overtime pay.
How hourly employees are paid
Hourly workers are paid according to the prescribed hourly wage multiplied by the number of hours worked in a specific wage period. Under the Fair Labour Standards Act, all hourly labourers are viewed as non-absolved workers. This implies that hourly labourers should be repaid at a pace of time and one-half for consistently worked more than 40 hours in seven days. Most hourly labourers are guaranteed a predetermined measure of hours out of every week. The special case is the place where the hourly labourer is dependent upon a work contract.
How Salaried Employees are paid
Salaried workers pay is determined on a yearly premise and is split between indicated payroll intervals, which are regularly week by week or fortnightly. The sum and consistency of pay is expressed in a salaried worker's agreement. Some salaried workers are absolved workers under the FLSA rules. Most bosses don't give extra time pay to salaried workers. Nonetheless, they may offer different benefits like time off from work, as an option in contrast to extra time pay. In the event that a salaried representative is viewed as a non-excluded specialist, their boss should repay them at time and one-half for quite a long time worked more than 40 hours in seven days.
Pros of Being a Salaried Employee
- Fixed regular pay check gives you a security and peace of mind
- May offer a more flexible schedule
- May allow opportunity to work less than 40 hours a week
- Ability to miss work without being docked in pay
Cons of being Salaried Employee
- May require you to be available during “off” hours
- Usually does not pay for overtime hours
- May require you to work more hours than an hourly position
Pros of being an hourly employee
- Ability to earn overtime at 1.5 times your regular hourly rate
- Will be paid at least the minimum wage for every hour worked
- Can “work ahead” and take less vacation time
- Offers flexible working hours
Cons of being an hourly employee
- More difficult to count on an income
- If you miss hours or a shift, you likely won’t be paid for that time
- Can miss out on wages if hours or shifts are docked
- Typically a less flexible work schedule
Eventually, there's no clear answer on whether a salaried job is superior to an hourly one. A few variables sway each position at each organization inside every industry. While salaried people may feel affirmation with a fixed yearly sum, hourly representatives profit with additional time pay.
My thoughts on Hourly vs. Salary
Overall I think both an hourly position and salary have equally good benefits. One thing that always sticks in my mind is when people share with me that they are salary and I tell them that I am hourly, they always seem to want to go back to 40 hour week weeks and the possibility of overtime.
While I cannot control my current position and if I am hourly or salary, I would suggest next time you are offered a position to really look at what they are offering. Talk with multiple sources. It could turn out that you value having a start and an end time rather than staying late.
For me, it was great to walk away and realize the financial world would not crumble! Leaving right at 5:00 certainly has its perks. Remember the work will be there tomorrow, I’m sure of it.
Raiyan is the Marketing Consultant at Leave Monitor and has been managing and maintaining the marketing campaigns for the platform.