Should You Get Paid Less to Telecommute?

Here's a piece from Career Journal that says telecommuters should be paid the same as other workers who hold the same job. Here's why:

"Employers make money on telecommuters," who tend to be more productive and loyal, and less expensive because they don't occupy company-financed office space, Mr. Nilles says.

But this brings up a couple of interesting questions -- would you accept less if your company allowed you to telecommute? How much less would you take?

I'm not sure I'd value it at that much -- maybe a few thousand dollars a year at tops. Though I must admit it would be much more convenient. I could sleep an extra 50 minutes every morning and still get to work at the same time. If I valued this time at $20 per hour, that's $833 in a year a few thousand dollars a year (see comments below). And it could afford a lot more flexibility if I was also allowed to work whatever hours I wanted as I'd often work late into the night (when my family was asleep) for more time off during the day.

What about you? Would you take less pay to telecommute? How much less?

Comments

[Honest Dollar]

I used to work in investment banking, where above the ridiculous hour we worked in the office, we were expected to be available to work at home as well in case emergencies arise or we're sick and can't make it in (but aren't allowed to rest, either). On the one hand, I hated how work intruded into my non-work life. On the other hand, I loved working from home because I didn't have to deal with obnoxious people face-to-face, only by email, and I could fill the downtime with things I want to do. Since being a banking analyst involved a lot of downtime waiting for more senior personnel to make edits on our work, being able to spend that time at home rather than diddling my thumbs at my desk meant a lot to me.

I'd probably take a pay cut to telecommute, based on a valuation of commuting time saved, transportation costs saved, plus a small premium for the extra freedom and flexibility. Hmm ... that works out to $10,000. Yowza.

[Tracee F.]

Nope. I work in IT and have a position now where there's no official telecommuting, but everyone in our department has the ability to work from home as needed. I'll be working from home for 3 months after a knee surgery that's upcoming, for instance, and we frequently call in "working from home" because we have sick kids or repair people coming to the house. Because we have this ability, we frequently work longer hours (and are salaried) and nights/weekends when needed. It's nice to have the flexibility, but as my boss says, it all works out. I think the employers get as much as the employees get, frankly. Even for a full time telecommute, I wouldn't take a pay cut.

[jc]

are you sure it's $833/year? At $20/hour, if you save 50 min in the morning, you save 50 min in the evening going home so it's 100min that you save.

100 min/day * 1 hour/60 min * * $20/hour = $33.4/day

$33.4/day * 5 days/week * 50 weeks/year = $8350/year

That's pretty significant savings. of course less commute costs, you could feasibly say around $10k/year is how much you save. for those at $30/hour, or have longer commutes (mine is 80 min each way door to door) it can be a lot more. shoot, if I valued $30/hour and 80 min commute each way, we are talking a value of $20k/year. interesting eh?

if telecommuting is part of the package, then I'd make sure that you got the right $$$ value assigned to the perk. I personaly don't know if I would like it because then I would feel so isolated...

for the record, I love my commute on the train, as it's built in reading time. :)

[brent]

What a daft thing to say - that's like saying "The fact that you enjoy your job - that's part of your compensation package. The fact that we have a relaxed dress code - that's part of your compensation package. The fact that we respect your occasional need to come in early so you can leave early - that's part of your compensation package."

No.

The thing that comprises my compensation package is the amount of money that I get. The thing that determines how much money I get is how much value I provide.

How I provide that value is immaterial - as long I abide by some mutually acceptable terms and conditions.

[Nivek]

The few people I know who were able to convince their employers to let them telecommute full-time were also able to convince their employers to also give them a pay raise,not a pay cut.

[F. Morana]

I would be delighted accept a lower pay for the privilege of being able to work at home -- provided the employer compensated me for the use of my office space and supplies, shelf and storage space, and a specified pro-rated percentage of the monthly bills for heat, electricity, internet, telephone, and home insurance.

[F. Morana]

I would to to add to my previous comment.

Strictly speaking, telecommuting is illegal, unless your home is zoned as a commercial property. If it's not, then you may be legally required to obtain a zoning variance.

I presume that the employer, in its infinite generosity, would arrange for any necessary legal representations in this regard, and also, that the employer will gladly pay for the appreciable increase in your real estate taxes.

The employer might also indemnify you for the difference in the tax rate, in the event that the job does not work out and you are now stuck with a commercially-zoned property.

[Lord]

That only applies to some cities; Los Angeles comes to mind. Most are indifferent and for them commercial would only apply for signage and customers visiting.

The difference is not in pay but whether I would take a position or not. If the commute were longer then 30 min, telecommuting is the only way I would take it. Nearby, it wouldn't matter much.

[BillyOceansEleven]

Telecommuting usually isn't possible in my line of work (business consulting), but if it were I probably wouldn't accept less money. Although you have the flexibility, you also now have the expenses of maintaining a workspace at your home. I'd imagine that in the long-term your career growth prospects (and in turn your monetary compensation) would suffer from the relative lack of in-person interaction with superiors. Of course being able to do full-time telecommute (i.e., no time in a corporate office) would allow you to live wherever you want and not be tied down to a particular location. Hmmm, maybe I would do it...

[FinanceAndFat]

I might take less money, but it would have to be a really good job opportunity to justify that (great company or great experience). I'm switching to one day a week from home at my current job soon and that of course has no effect on my salary. The almost 2 hours I save on commuting is awesome though.

[Tim Struck]

I've been telecommuting for 5 years now. I would not accept less pay. In my case I know I am much more productive with a home office compared to when I worked from corporate headquarters. I not only work more hours per week but those hours are more productive. I don't think telecommuting is for everyone though ...

Positives:
- ability to live where we want (recently relocated from Minneapolis to Houston to be close to family ... plus the cost of living is much better in Houston with no state income taxes and cheap housing for the same pay)
- flexible work schedule
- home office expenses are paid for (computer, phone, cell, internet, etc)
- no commuting costs (we actually sold one of our cars)
- family time is great. I don't think I will ever look back and say I wasn't there for my kids

Negatives:
- there's not as much opportunity within my company working from home (i.e. moving to a different department or managing the team)
- on busy days/weeks I don't get out of the office much (I try to break for lunch outside the house every day but sometimes it just doesn't fit into the schedule
- I ALWAYS take my work home

Overall I wouldn't trade my situation for anything (at least for now!)

[FMF]

JC --

Your numbers are right -- don't know where I got what I did. I did forget the savings on the way back, though, so you highlight how much the total savings could be. Thanks.

Brent --

You're partly right, but the overall conclusion you come to is wrong. For instance:

"The thing that determines how much money I get is how much value I provide."

From the employer's perspective, this is usually correct. Though if you can provide more value and the employer can get you to work for them than less than market wage (for some reason), they will.

"The thing that comprises my compensation package is the amount of money that I get."

If money is the only factor you consider when deciding what company to work for, you're way off track. There are tons of other issues that should be considered, and commute is one of them. For instance, if you can make $50k at a job 10 minutes from your home or $50k 60 minutes from home and all other factors are equal, which would you pick? Using your rationale, they'd be equal, so you wouldn't know which to pick. I think though, that most people would pick the 10 minute commute, thus showing that other factors besides money influence how people select jobs.

"How I provide that value is immaterial - as long I abide by some mutually acceptable terms and conditions."

Yes, and part of these "mutually acceptable terms and conditions" are your commute, working conditions, authority, and so on and so on. In other words, non-monetary issues associated with a job.

[Joey]

> "Employers make money on telecommuters,"

Then it would stand to reason that telecommuters should get paid more, not less.

[aa]

At least, telecommuters should only accept regular salary - transportation cost, period.

[aa]

By the way, please don't drag down the national personal income figure that way.

When one day employers love telecommuters, they WILL DEFINITELY hire outside the US!!!

[Frugal Duchess]

No! As a work-at-home writer, I actually work longer hours than I did when I was on a corporate payroll.
I think telecommuters are a win-win bargain for corporations.

[Aaron]

I wouldn't take less from my current position but I am considering what the value of telecommuting is when weighing some new positions. Theoretically I would spend a lot less on the following items:
*Lunch (3 days per week, $6.50 / day * 52 weeks = $1014, don't forget when you treat others and when it's closer to 10)
*Gas (2.90 / gallon, 20mpg, average one tank per week - roughly $35 bucks) 35*52 = 1820, not to mention fewer repairs and possibly lower insurance on the car
*Clothing - buy a little less becuase I can wear jeans and keep the nice stuff nice for longer and less of it - $500
*Soda's / candy - $1 /day(conservative estimate) - 20 days permonth = $250
Total: $3500 / year, that's not bad, that's an extra $300 monthly

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add up the values mentioned earlier in these posts, like an extra 2 hours per day (1.5 roundtrip and .5 getting ready, I'll leave out the value of not spending an extra unpaid hour during the day at lunch) - 2 hours /day * 20days / month * 12 months * $30/hr = $14,400 - say you make $50 = $24,000, although this isn't real dollars, only "personal" time value.