
Whatever Happened to Overtime? - wallflower
http://www.politico.com/magazine/story/2014/11/overtime-pay-obama-congress-112954.html
======
dsr_
Nobody in my company is average.

None of my friends are average.

The odds are very good that, if you are reading HN, you are not an average
person either.

Please take that into consideration when discussing economic measures meant to
improve the lives of the middle class. You are probably better educated, earn
more, work in a less physically strenuous job, have better employment
prospects, are more likely to start a company, have more respect from your
management, and are more likely to leave a job in order to be happier.

Now put yourself in the position of most people, which are all the opposites
of the above: if you have a job, you are desperate not to lose it, because you
are less likely to get another one. You don't have the financial resources to
give up paychecks for a couple of months while you look for another job. Your
company considers you an interchangeable, entirely replaceable cog.

Have some empathy, people.

~~~
falcolas
To be fair, even as an above average person, were still in the middle class,
even if the upper portion of that class. Few of us in the software industry
are rich, just very comfortable.

But that comfort could fade very quickly, given a few scant months of
unemployment.

~~~
callahad
In 2011, a $100,000 salary gave you a higher individual income than 93.4% of
all working-age Americans [0]. Around that same time, the nationwide median
salary for a software developer was $93,350 [1]. Thus, today the majority of
developers are easily within the top 7% of compensation in the United States.
If that's the middle class, then what does that make the other 93%, who are
worse off?

[0]:
[http://www.census.gov/hhes/www/cpstables/032011/perinc/new01...](http://www.census.gov/hhes/www/cpstables/032011/perinc/new01_001.htm)

[1]: [http://www.bls.gov/ooh/computer-and-information-
technology/s...](http://www.bls.gov/ooh/computer-and-information-
technology/software-developers.htm)

~~~
chrisseaton
I don't think class is defined solely in terms of income is it? Isn't class
more about background, education, politics, lifestyle, tastes and culture? You
can be poor but upper class, and you can be a millionaire but working class.

~~~
eli_gottlieb
Class is about whether or not you own all the tools necessary to produce a
useful product and send it to market. If you own the means of production,
you're a capitalist. If you must hire yourself out because you _don 't_ own
the means of production, _you 're working-class_.

~~~
TheSpiceIsLife
What's a "useful product"? Who owns the means of production? The CxOs? The
board? The product design team? The shareholders? You can be low-income and
still be a shareholder of a publicly listed company - the broker I use here in
Australia has a minimum trade of AU$500 with AU$19.95 brokerage fee. What
class do I fall in to if my income is below average yet I have significant
stock holdings?

Anyone with a computer, an Internet connection, and the gumption to do so, can
send a product to market.

~~~
eli_gottlieb
>Who owns the means of production?

The shareholders and board, primarily.

>What class do I fall in to if my income is below average yet I have
significant stock holdings?

Well, you're implying that you have to work for a living or starve, so you're
working-class.

>Anyone with a computer, an Internet connection, and the gumption to do so,
can send a product to market.

And yet only roughly 0.1% of the population actually lives off anything other
than wages.

------
mpat
The narrative is that overtime hours represent hard-work and dedication
towards the employer and its mission. As the average worker is looking for an
opportunity to advance their position, they accept overtime as a necessity,
and sometimes as a badge of honor.

However, from a management perspective, unpaid overtime is great. It lets you
be lazy in your management. You have no incentive to help an employee finish
their tasks in 40 hours when you know they are going to stay 55 hours to
complete it by brute force.

If you assign a cost to those overtime hours, the manager now has an incentive
to actively participate in your workstream by coaching or seeking efficiences
to get you home in 40 hours. And you have the incentive to do likewise since
your overtime hours now represent an additional cost to your employer. It will
transform overtime from a badge of honor into a topic to be avoided unless
truly necessary. It will no longer be the norm.

We can discuss the virtues and detriments of labor unions at length, but they
seemed to at least serve as a mechanism of protecting the worker from
themselves (i.e. by placing a cap on hours worked, you could not stand out by
putting in more time than everyone else).

We as a society need to decide if we want to prioritize time incurred in the
workplace, or if we want to judge worker quality off of other behaviors. If we
want to de-emphasize time incurred, adding incremental cost to overtime hours
would be a useful tool.

~~~
harryh
However, from an employee perspective, paid overtime is great. It lets you be
lazy in your work. You have no incentive to help the company finish it's tasks
in 40 hours when you know they are going to pay you to stay 55 hours to
complete it by brute force.

I'm not saying you're wrong. I'm just saying that there are two sides to
incentives and it's not obvious that one side is more important than the
other.

~~~
joesmo
There are a ton of incentives to not work the 55-hour week as an employee even
when it's paid 1.5 or 2x. Health and having time to do other things are
probably near the top of the list, but there are many others like morale,
avoiding fatigue/burnout etc. Having a cap on hours worked and forcing
employers to pay for extra hours, even if it's at the same rate as regular
hours, works incredibly well in practice. Not having such a cap and not paying
for extra hours doesn't. Inevitably, at the very least, the work will suffer
greatly, probably to the point where the extra hours become meaningless
compared to what the workers could achieve if they were not overworked.

~~~
harryh
Empirically employees who get paid 1.5x or 2x for overtime seem to want to get
as much overtime as possible regardless of the fact that it cuts into other
activities in their lives. That's at least been my perspective. I'm not sure
if there are any large scale studies done on this topic.

You might be correct that the best way to balance the competing incentives is
to require overtime pay but not at a higher rate.

~~~
Retric
In large part that relates to the low pay of anyone that still qualifies for
Overtime in the US. But also because it's calculated on a week by week basis.
Work 60 hours in one week with double over time and you get to take 1 full
week off. Change that to a monthly or yearly basis and people are less
inclined to work overtime.

------
kamaal
Indian, here. And this article is dead right!

This trend is getting common even here in India. In fact its already
everywhere. My father routinely points out to me how ridiculous it has gotten.
Back in his day(He was a bus driver, now a cab driver), you would be called to
clock overtime anytime a fellow driver was on leave, sick or just absent due
to same reason. And they would get paid handsomely for it. In fact overtime
pay was the whole thing behind _' Work hard, get rich'_.

When I started my career in Software, and I would routinely do late nighters
and weekends. He used to be surprised we were ready to do so much work for
free. Ideally you could argue that a bus driver and a programmer have very
different kinds of jobs, but then it the same vein programmers should get paid
proportional to what impact their work has, but that doesn't happen either.

I think the employers are having the best time in history. Which so many
people ready to so much work for free, what else could you ask for?

------
Shivetya
Go for it. As I stated before, his last two years can be used to fix a lot or
cause a lot of strife. The President has shown little concern for others in
his party and does love sticking it to those who don't agree with him.

He really has nothing to lose, fixing the overtime rules would be a great step
in restoring faith in the system; but I think 69k is aiming far too low.
People should be allowed to work overtime, not be forced into it. Hence I am
suggesting he aim really high, like the Roth income level cutoff. It already
is a declaration of the government as the line between too well off to deserve
the tax benefit.

~~~
yardie
From the left, this president is considered far too accommodating the right.
This is one of those issues that everyone can see needs to be fixed and would
be popular enough to be incontestable. I'm sure the republicans will be
against it because they did not think of it first.

~~~
WBrentWilliams
To be fair, the President only works as hard as the votes he can get for his
party. That's not over. Obama's job for the next two years is to do what he
can to make it a possibility that another Democrat will come after him. That
means he will do a lot, but whether or not he will take this specific action
is hard to ascertain.

------
briandear
Are the workers powerless in this? I am not debating the premise, but it's a
fair question. Wages are generally driven by market conditions (except in
Union jobs, but that's another discussion..) so I wonder if the similar
competition for wages ought not include hours worked. A 40 hour job paying 50k
would be preferable to a 60 hour job paying 60k, yet most job seekers simply
look at the salary and not the cost. It would seem that wage competition
should naturally extend to hours competition. I see this in some startups..
They might offer you $125k yet imply an 80 hour week is expected. So that
salary is dramatically lower than a 100k position at 40 hours. Yet that
differential is rarely discussed. I think a mandatory, government imposed rule
ultimately distorts the market. What if someone is willing to work extra hours
as a part of their salary? I'm not sure the government 'protecting' us can
actually be quantified so clearly. If an average position pays $55k and
requires 55 hours, then with new overtime rules, there's nothing preventing
that salary to become $40k. My point is that business will always optimize --
a business will never pay more than the value of the input. What would likely
happen is either increased hiring of no benefits part timers or an increase in
the product price which would then drive inflation. There's some serious
unintended consequences that the original author seems to gloss over. I am not
sure who this guy is but unless he's paying his workers overtime, then I don't
much care what he has to say. If he's a "wealthy" entrepreneur who doesn't
like the rules, he's free to pay his workers more. He's also making the
suggestion that "corporate" profits have grown-- which corporations? All of
them? The majority of businesses are small businesses -- what effect would
these rules have on them?

I am not dismissing the premise, just suggesting that there is far more
complexity and shades of gray involved.

~~~
markbnj
You can't really negotiate on expected working hours, because the minute that
comes up you will be off the list of prospects at most places. Salary is out
there in the open and can be talked about, but the idea that you might not
want to work 50 hours? Not so much.

~~~
alkonaut
I'm not working in the US but I'd definitely not take a job at any salary
without knowing the office culture, overtime trends etc. I'd simply be very up
front with that I'm not about to work more than 40h _on average_ , and that
the compensation is exactly for that. When I recruit people, I fully expect
them to have the same idea. If this makes me less eligible for the position
then that's all the better: I wasn't interested anyway.

------
tokenadult
I read through the article, and I read through the comments here, and I did
some online searching for other writings by the same author as the opinion
essay kindly submitted here. The author describes himself as an
"entrepreneur," but I haven't yet found some detailed sources about how his
business ventures were formed or funded. I have found some strong criticism of
his basic understanding of economics.

As for the law on the topic, the author may be correct that the President
acting alone can use executive authority under established law to let the
income threshold for mandatory overtime pay rise. I haven't checked whether or
not that is entirely in the hands of the President under current United States
law. If so, then the only politics around the issue would be the politics of
what an incumbent President already in the second half of his second term (a
"lame duck" President) thinks is an appropriate response to this issue among
all the other issues he is dealing with.

What I don't know here for sure is how much any of this would matter
economically to most people. Neither my wife nor I are employees of anyone (we
both work as sole-proprietor business owners). We can work as many hours as we
can stay awake without gaining overtime pay. What I hear about more often in
the United States economy than employed wage-earners not being paid overtime
is employed wage-earners not being offered even full-time hours, because
shorter hours remove a requirement to provide employee health insurance
benefits for many employers. I'm not at all sure what the author advocates
here would have a big beneficial effect for the economy in general or for
workers now working overtime in particular. Demand for labor working under any
particular schedule is elastic, and maybe the proposal here will just result
in fewer working hours being offered per employee.

~~~
raarts
There are many things that we cannot be sure about. But I do share his
concerns. If wealth inequality keeps growing, this will inevitably lead to
social unrest. And shrinking wealth for the middle and lower classes will
deprive many companies of their customers. Or will the top 1% only sell their
stuff to each other?

~~~
maerF0x0
The 1% will trade our labor back and forth to their gain in a cycle. Eg: a
rich person will trade $100 for house cleaning service (basically costs
lower/middle class time) for some other service (Casino black jack dealer?).
In this way they can both experience the services produced by the lower/middle
classes w/o degrading their total holdings. Plus, if they own the things the
lower and middle class spend their income on then any money that does trickle
down will eventually end up as revenues on the books of an asset they own
(walmart or a utility for example).

IMO the best ways to break these cycles is to try and buy things from people
poorer than you and to try and own as much of the economy as you can. The
middle class could buy up much of the economy with little effort-- If 100m
people spent ~$3k each they could buy walmart instead of outfitting a home
theatre with 60" tv, ps4, accessories and a couch. There'd be some amazing
change in america if this kind of thing started to happen.

Of course its like all changes though, its hard to get the masses to do
anything in unison.

------
golemotron
The thing I always heard is that if you are any hourly worker you are paid for
your time. If you are a salaried worker you are paid to get the job done
regardless of how much time it takes. I think I've heard that cited in legal
cases. It seems like a useful distinction.

Many jobs in the modern economy are flexible. You do your work whenever. Maybe
you carve out six hours a day to program but if you need to take a client call
or answer an email out of hours you do it and you don't feel bad because you
can goof off during the day when you like to as long as the work gets done.

Tracking this would be ridiculous and most employers will actually remove that
flexibility in order to make sure that they comply with the law. People who
like flexibility will lose and so will the economy. We'll become much less
responsive.

~~~
imgabe
In reality if you're salaried and you get the job done in less time than your
coworkers, you're simply given more work to do. It would be great if you could
finish your work by noon and go home, but very few workplaces are actually
like that.

~~~
tdk2fe
One thing i'm working on right now is basically building a bit of a "Blue
book" for mundane components of the services we offer.

This seems to have some very positive "work life" balancing effects - it
motivates engineers to learn things at a deeper level and develop solutions
that cut down on inefficiency. It also encourages people to invest thought
into solutions and proposals, as opposed to micromanaging how every hour of a
project will get spent.

I think its also more fair to clients, too. Inevitably new things take longer
the first couple times you do them, and traditionally the full cost of that
learning period gets passed on to the client in one way or another. However,
something that took two days to put together and figure out the first time may
only take two hours to implement the next time - but it's hardly fair that
Client B is only billed 2 hours and Client A is billed 16, simply because they
were first to market with something.

------
nasalgoat
IT workers are an exempt class is Canada.

~~~
snarfy
In the US as well.

~~~
otoburb
In case readers don't understand what "exempt" means as applied to hourly
overtime:

US: [http://www.dol.gov/whd/flsa/](http://www.dol.gov/whd/flsa/) Canada:
[http://www.labour.gov.on.ca/english/es/pubs/guide/overtime.p...](http://www.labour.gov.on.ca/english/es/pubs/guide/overtime.php)

~~~
burkemw3
And specifically IT guidelines for US:
[http://www.dol.gov/whd/regs/compliance/fairpay/fs17e_compute...](http://www.dol.gov/whd/regs/compliance/fairpay/fs17e_computer.htm)

Not all computer and technology related jobs are exempt. As I read it, the
exemption focuses on employees that are primarily creating hardware and/or
software.

------
altcognito
It would make good political sense as well, as the conservative talking point
is that hard work should be rewarded.

~~~
briandear
Then workers ought to demand a raise if they are feeling undercompensated. The
market pays what the market allows. Any distortion of that market would have
deleterious effects somewhere in the chain. Any time you artificially increase
the price of something, that rational response is to seek a substitute; which
might mean that more overseas offices are opened and more jobs would be
offshored. Which would actually increase the desired effects -- perhaps even
increasing unemployment and wages. To paraphrase Jurassic Park: markets will
always find a way.

~~~
Hannan
>> Any distortion of that market would have deleterious effects somewhere in
the chain.

Regulation, collusion, and asymmetric information all seem to be "distortions"
we're dealing with today; "The market pays what the market allows" seems to be
an oversimplification as we're not operating in a free market.

------
greenyoda
_" The president could, on his own, restore federal overtime standards to
where they were at their 1975 peak, covering the same 65 percent of salaried
workers who were covered 40 years ago. If he did that, about 10.4 million
Americans would suddenly be earning a lot more than they are now."_

But the president doesn't have control over the budget - Congress does.
Raising pay without having the money to write the checks isn't really an
option.

And unless Congress wants to cut other government services, that extra money
needs to come from somewhere, so this would just be a transfer of wealth from
non-federal workers (whose taxes would be raised) to federal workers. Taxing
the rich corporations to pay for this isn't easy either - they can afford
armies of lobbyists to fight against higher taxes (and they'll be the ones
making the big campaign contributions in the upcoming elections).

~~~
eli_gottlieb
TFA isn't talking about Obama raising pay for federal workers, but instead
about changing labor regulations that cover _all_ workers, including the
private sector.

------
johansch
Swedish software company (not new-ish):

Almost all developers work their nominal work hours. A few work a little more
on their own choice. There is no pressure to do so, but it's also not frowned
upon (unless it's obvious that there's some cultural misunderstandings going
on, e.g. in the case of someone moving in from a non-scandinavian work
culture, perhaps thinking that they really, really have to prove themselves by
working _hard_ to get to stay.)

At crunch time sometimes key people get asked/ordered to work paid overtime
(each overtime hour ends up something like 2x a normal hour, I forgot the
exact constant). Estimate max 50 overtime hours/person/year, and not every
year. There is some sort of social pressure that makes you feel bad when
ordering this overtime....

Senior managers tend to work more hours, but they are also better compensated.

~~~
jahaja
It's pretty common to have unpaid overtime (including crunch periods) in
Sweden as well. Actually, I've not heard anyone having overtime pay while
working in IT. The lack of overtime pay is usually "compensated" through an
additional week of vacation or similar.

~~~
alkonaut
"Unpaid overtime" in this context usually means no _extra_ compensation, other
than the 1-1 compensation if working less next week or next month. That is, a
50h week followed by a 30h week. Ordered overtime still has to be paid, but
just at the normal rate. Having this in your contract isn't very good, and you
should have at least 10-20% extra compensation. An extra week vacation isn't a
good compensation for this, but it's common, sadly.

~~~
jahaja
If one has traded overtime pay for a weeks vacation you won't get overtime pay
for ordered overtime either. The overtime just can't be "planned/scheduled",
it's rather vague unfortunately.

~~~
alkonaut
That would imply you don't have any "flex" scheme at all, something I'd never
sign up for at any compensation...

~~~
jahaja
An unofficial possibility to flex is good but I'm pretty certain that the end
result is that people do not "flex" back the overtime fully.

------
skylan_q
Workers can't dictate working conditions in general until unemployment is
close to or effectively 0.

As long as there are unemployed, there people to hire at bottom dollar.

~~~
skylan_q
Downvotes, but no rebuttal.

Thanks for sharing your enlightenment.

