How big a pay cut would you take? 6

[ajack1]

Having done the festive rounds meeting up with friends and family I don’t normally see on a regular basis I was very surprised how many were already feeling the recession.

Throughout a variety of jobs in different sectors many were on either on extended holidays, working a short week (some on full pay some not) or facing pay cuts and or redundancy.

I have not heard of short working weeks or pay cuts in the UK for many years now and it got me wondering, how many on here would take a pay cut (and how much) or a short working week in order to save their, or others jobs?

Or how many feel they are totally safe, or could go out and match what they are on in the current market place, or even would not take a pay cut under any circumstances?

 

[oneintheeye]

im curious how a company can bill client 60 hours but not pay you for working it? (see earlier post). Surely you must get time off in leiu or something? How can the company charge when it has incurred no cost?

 

[jmw]

..on some other planet, maybe.
Management response to any such proposals (as with me when I asked for some time off after spending the week at the office and the weekends at a clients site):
"It goes with the territory."

JMW

http://www.ViscoAnalyser.com

 

[ajack1]

No it happens on this planet jmw.

In the past when I was having to travel overseas and putting in long hours and getting some really awful flight times to troubleshoot problems I was always given extra time off and or a bonus, without even having to ask.

So it is not the management response to any such proposals, it was the managements response to your proposal. I guess it all boils down to how good your manager is and or how highly they regard you and the work you do.

 

[ScottyUK]

At my previous site management never officially acknowledged the long hours and lost weekends but at a local departmental level there was a lot of flexibility if we wanted a day or two off after a trashed weekend or if we needed an early finish or a lie in for some reason. Overall it was heavily weighted in the company's favour but the flexibility was nice. One of things which used to really infuriate me was when the same managers who demanded that we muster a nightshift out of the dayshift crew, usually late in the afternoon and with no time to get people home for a few hours rest, could not be bothered to pick up the phone the next day to say 'thanks for your effort, it was appreciated' to those who dropped everything they planned to do in order to deal with some emergent problem. The little things mean the most and cost the least. Like ajack says there are good managers and bad managers.


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If we learn from our mistakes I'm getting a great education!

 

[KENAT]

I don't know about how big but I know how long I'd take it for:

As long as it took me to find something better.

Unless being laid off and picking up unemployment is an option, in my situation that may be better than a significant pay cut.

KENAT,

Have you reminded yourself of faq731-376 recently, or taken a look at posting policies:

http://eng-tips.com/market.cfm?

 

[jmw]

Ajack1:
right both times... rotten management that apparently didn't highly value my work.... but unique? no. I've seen too many bad managers and very few good ones.

PS by not highly value my work, I mean that while I was apparently the only one capable of the task, management didn't want to have to pay the price or acknowledge it in any way.

Curiously enough, that particular manager was eased out and, following a few company mergers and acquisitions his buddy, the current MD, has recruited him back into the company which just goes to show that the rot went all the way to the top.

JMW

http://www.ViscoAnalyser.com

 

[frv]

Curious. Only one structural response concerning security.

I too am a bit concerned. Our work load has certainly diminished over the last few months.

I don't know if it's naive optimism, but I think the owner of our company is someone with long term vision. This recession, though deep, will also pass. I expect him to maintain his staff in anticipation of the rebound. For a while, it was tremendously difficult to recruit talent, given the incredibly high demand for engineers. I think he will do his best to keep those of us who are currently with the company.

I don't know about taking a pay cut. I may reluctantly agree not to take a salary increase this year, but that's about it. I think I'm fairly marketable and I'm willing to relocate, so I'd be on the phone five minutes after I was let go.

 

[oneintheeye]

maybe this culture is a US thing, I have never known a company expect people to work unpaid overtime and bill the company. Surely thats unethical. (thats how tom cruise gets the mob in The firm!).

In the UK we get paid or time off in leiu in my experience. I have in past worked on a project as overtime and not booked to the client, i.e. fixed fee jobs to keep costs down. But never unpaid and booked.

 

[jmw]

I think in Tom Cruise's case they were billing hours that didn't get worked.

Billing for the hours your engineers worked but not paying your engineer for the same hours is showing "responsibility to the shareholders interests".

It is far from uncommon.

We might go so far as to enquire: if the company is billing the engineers time at £400 per day, why is it not paying the engineer £400 per day since he evidently is earning this money?

JMW

http://www.ViscoAnalyser.com

 

[oneintheeye]

thats not the same though is it cause the billing rate reflects actual costs to employ (maybe 2.5 times your hourly rate) plus overheads plus profit. What I cant see is ethical is billing clients for no incurred cost.
Plus it may lead to poor pricing of jobs in future. Thats no different billing a client for an employee who wasn't even working on the job in my opinion. I believe it is totally unethical and will only mean reduced pay for engineers as the company will continue to get more work than paid for. Plus it is potentially keeping the company employing another engineer that the company obviously needs to meet its obligations.

 

[moltenmetal]

herewegothen: dunno if it's a US thing or a North American thing, but can say it happens in Canada for sure.

You've obviously not worked for some of the b*stards I've worked for...There are unethical people out there who do compell uncompensated overtime from their staff in the name of "professionalism", or as a condition of advancement etc. The people doing the compelling often have an ownership stake or are compensated via profit sharing for the effort that they steal from you! In the days of one or two jobs in an entire career, perhaps this could be justified as "paying your dues", but today it's just dumb...the company will still lay you off if you're not generating a profit for them, and they won't hand you a cheque for those "dues" you paid them...

Why you would donate time to a client who is paying by the hour for the work is totally beyond me. If you spent 40 legitimately billable hours on their project during the week, and another 10 doing non-chargeable/admin work, you're telling me that you wouldn't bill the client 40 hours? Or if you worked 50 legit billable hours for a client to meet THEIR deadline, you're telling me that you'd donate 10 of those just because your own firm wasn't paying you for them?

I can understand (but don't agree with) the tendency of some engineers to feel compelled to work uncompensated overtime for their own employers. Personally I think it's unethical for engineers to work for free (other than doing charity pro-bono work etc.), as it de-values our services in the marketplace. To work uncompensated O/T for a piece of the action (shares, profit sharing etc.) or for time in lieu is fair game- it's a business investment- sweat equity if you will. But to forego billings for the work you're doing benefits only the client- not your own firm. What purpose does THAT serve?!

 

[KENAT]

herewegothen it happened in the UK, maybe not in your industry but in my little patch of defense it sure did. In practice we'd get some flexiblity or occasionally some kind of bonus etc. but none of this was official and depended how the Tech Director and/or MD was feeling. Salaried staff were expected to be a bit flexible and give some time if required by the company. In return we had a higher base rate.

While in theory I appreciate what molten and you are saying, right now wouldn't be a great time to get laid off and while I'm looking for something better I'll work a few extra hours to keep what I have.

KENAT,

Have you reminded yourself of faq731-376 recently, or taken a look at posting policies:

http://eng-tips.com/market.cfm?

 

[MechEng2005]

herwegothen,
While I can empathsize with your point, it just isn't the way the world works in my experience. I occasionally work some overtime, even though I am a salaried employee. The company I work for keeps track of my hours and puts it as "cost" for future estimates, at normal rate (not 1.5x as might be common for non-salaried overtime though). Then, for future projects, the number of hours, even the "free" ones are accounted for.

I try to limit my overtime because I don't want the management to avoid hiring necessary labor (and of course because I enjoy not being at work more than I need to). However, sometimes things come up and things need to get done. I wouldn't expect the company to hire another engineer for about 200 hours a year worth of work in certain circumstances. As a matter of fact, if they did hire somebody and were over-staffed, I might get a lower raise since they now have to pay another employee. And if this happened everywhere, the value of engineering and salaries across the profession could suffer, or at least not keep up with inflation. So either way, the profession could suffer, whether due to working "free" overtime or from companies needing to be overstaffed during slow times (assuming this means properly staffed in busy times).

-- MechEng2005

 

[moltenmetal]

MechEng2005: we're not talking about a few hours a week here to meet your personal obligations, or even a few long weeks to help out your employer through a rough stretch. I doubt there's an engineer out there who hasn't done that at some point.

What we're talking about here is supervisors who tell their staff that although the employment contract says 40 hrs/week, you're expected to put in 50+ to show your "dedication". Bosses who set 90% billability targets, ie. so that proposals and just about everything else gets done out of "free" overtime. Especially when the firm is paid for any extra hours by the client, yet the staff are not paid for O/T. ESPECIALLY when the boss gets profit sharing and/or has ownership and compells uncompensated overtime from their staff to line their own pockets!

Putting up with that treatment does not make you a professional: it makes you a sucker. Volunteering for a profitable company isn't just foolish, it's also unethical, as it de-values the services we all provide.

If a business treats me as an employee, I'll treat them like an employer: I'll put in an honest day's work for an honest day's pay. If they treat me like a true business partner, sharing the profits equitably with me, then I'll invest extra effort and make the necessary sacrifices for hte benefit of the business, like a real part-owner.

 

[ajack1]

Would you really want to be treated like a true business partner?
If that profit turned into a loss would you want your share of that as well?
If you really want that risk and reward why not go it alone or buy into a business?

 

[oneintheeye]

I think we all agree that we would put in short term/few extra hours to help out.

It is intrinsically unethical to charge a client if you have not incurred a cost. i.e. free overtime.

It is taking the P*** for your boss (and company) to expect free time then earn bonuses on that time.

Anyone who does that permanatly (employer or employee) are fools and are a) responsible for low pay for engineers b) reducing the attractiveness of engineering as a profession meaning skills shortage and losses to other professions.

 

[Gstoner]

"If a business treats me as an employee, I'll treat them like an employer: I'll put in an honest day's work for an honest day's pay. If they treat me like a true business partner, sharing the profits equitably with me, then I'll invest extra effort and make the necessary sacrifices for hte benefit of the business, like a real part-owner."

Thank you Molten! That is the best summary of how we SHOULD see the 'employment transaction'

I know that I'll be adding that one to my memory for long term storage

"A Designer knows that he has achieved Perfection not when there is nothing left to add, but when there is nothing left to take away" - Antoine de Saint-Exupry

 

[MTPipeliner]

I'll add my 2 cents to the debate.

Job #1 -- Consulting firm that bills clients by the hour, but pays employees a salary. I really felt abused and taken advantage of when I worked overtime because the company was making lots more money. I really don't see why they can't afford to pay for overtime when they are still billing hours to the client. This practice seems to border on un-ethical and is completely driven by the greed of the company and it's owners.

Job #2 -- Owner/Operator company that pays employees a salary. I didn't like working overtime, but I felt less abused because the company wasn't directly making any more money because of the OT that I worked. The company definately benefited because of increased productivity, schedule, etc., but they didn't directly make more money.

Either way I'm not a big fan of unpaid OT, but with a company that is still billing it's clients it really hard to swallow.

 

[cksh]

I think alot of this depends on your field. I am an automotive engineer at a supplier and do not get overtime but am expected to work 24/7 to get the job done. Do they bill the client for the overtime? No. Do they bill them for the 40 hours I worked that week? No. Is that cost in there somewhere? Maybe, but when we initially quote the project.
One of our customers wants an underhood junction box. We quote the finished good delivered to their door. My time is billed to a specific project # but those hours are mainly for our company to know how much time we need to develop future products.

A recent project we were awarded required me to design a JB. When it was finished we had to request money from the customer to have it built. This did not include my time at all. Just the toolmakers cost.

I believe companies look at us as a tool, much like an office product or CAD software. I can use Office all day. It doesn't cost anything extra. There are the yearly maintenance fees but we will call that a raise. I truly doubt my company includes my hourly costs in any quote.

Of course that is Automotive. Not that all automotive companies are like that.

Some jobs that I have had, if it took longer to design than they had anticipated, would add the hours onto another job that was underbilled.

 

[apsix]

I can't agree with "It is intrinsically unethical to charge a client if you have not incurred a cost. i.e. free overtime."

Does that principle mean that I can't sell a free gift that I received?

The client is receiving a service and therefore can be expected to pay for that service.

I agree it may be underhand/unethical to not pay the employee when the client is paying for the work done.