It's 4:15 on a Friday afternoon in July. From your cubicle, you can hear your office mates on their cell phones, making plans for barbecues, baseball games and camping trips. Suddenly, that report deadline doesn't seem so important. All you can think about is getting home, grabbing a cold drink and putting your feet up on the back porch.
You grab your coat and head for the door. You'd feel guilty about leaving early, but you put in 60 hours last week, or at least it felt like it. You can finish the report first thing Monday morning. Anyway, you think, it's not like they pay you by the hour.
Salaried employees only make up 40 percent of the United States workforce [source: Hunt]. The rest are paid by the hour. Hourly work is found in all industries: manufacturing, medical, IT, retail, hospitality and more. According to U.S. labor law, hourly jobs can't involve any management or leadership decisions and tend to be fairly routine in nature. Working on an assembly line or making burgers at a fast-food restaurant are examples of hourly jobs, but so are computer programming and some types of nursing [source: Hunt].
One major difference between hourly and salaried employees is that hourly work is subject to overtime pay. If an assembly line worker at a computer manufacturer in California works more than 40 hours during a single week, he'll get paid 1.5 times the normal hourly rate for every hour he works beyond 40 [source: Haines]. If his salaried manager works 62 hours during that same week, her paycheck won't go up at all. Salaried workers are exempt from overtime pay according to U.S. labor and tax law.
So the question is, do hourly employees work harder than their salaried colleagues because they feel more directly compensated for each hour of work? Or do salaried employees work harder because they generally receive bigger paychecks and feel a greater sense of responsibility to the company? Do more hourly workers goof around and pad their timesheets, or are salaried workers equally guilty of taking fake sick days and running personal errands on company time?
To answer these questions, we're going to start by looking into existing research on employee motivation and how factors like job satisfaction and a sense of ownership at the workplace affect job performance. We'll see how effective employee management can have a much bigger effect on employee productivity than whether a worker is paid by the hour or by the month.