According to AP, IBM is playing fast and loose with employee pay:
BOSTON (AP) -- Even as IBM Corp. reports record profits, thousands of its U.S. employees are staring at pay cuts.
It's the result of IBM's response to a lawsuit in which the company was accused of illegally withholding overtime pay from some technical employees. IBM settled the case for $65 million in 2006 and has now decided that it needs to reclassify 7,600 technical-support workers as eligible for overtime.
But their underlying salary - the base pay they earn for their first 40 hours of work each week - will be cut 15 percent to compensate.
Basically, IBM is reclassifying people who were on salary as hourly workers to whom overtime applies. It's then cutting their base salary to compensate for a supposed 15% expected overtime for all of them. That's five hours per week. Only some of the 7600 will actually get that overtime, and is seems that the majority expect their time to be cut back to 40 hours regardless.
Perhaps IBM managers will follow in Walmart's footsteps and force these workers to clock out and then work the overtime for no extra pay. Seems reasonable. After all, profits need to go up and these workers are competing with folks in India and China who get paid much fewer dollars per hour.
I've been saying that technology workers are horribly exploited and they've been glad about to be so as they're under the delusion that sweat equity is worth money. It's not. It's worth a shower. Though their employers will take them to the baths.
If you work on salary for a technology company, what's your hourly pay? Making $120,000 for a 40 hour week comes to about $57 an hour. That's pretty damn good. But if you work 60 hours it comes to about $38 per hour. If you were an hourly employee making the same base salary - $57/hr and got that $120,000 for a 4o hour week (besides being paid better than almost everyone on the planet - except lawyers) and you worked an extra 20 hours every week you'd make an extra $60,000 per year. So regardless of your salary, you're taking a major hit compared to an hourly worker.
Obviously, the hourly worker is unlikely to be paid $57/hr. A more likely sum would be $30 to $35 per hour. But that person, working 60 hours would make an extra $56,000 per year for being paid overtime. That would be more than the salary worker's income even if the hourly person didn't get all that overtime.
The point I'm trying to make is that IT folks work far more hours than they should for the money they get. The problem is they think they're doing great, but in fact they're being ripped off. Several times - not only are they being exploited for the time they work, but they're constantly under the threat of being outsourced to Asia.
It's a shame.
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