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[Sowelu]

So...I may be moving from a life of contracting to a true fulltime position.

Usually when I move from contract to contract, and they ask how much I'm looking to make, I just say "Well I just made / am making / usually make $X/hour", and they make me an offer which I take as long as it's not lower (or I'm desperate).  Mostly it's been a steady rise.

But now I'm not sure quite what to do.  Fulltime is clearly less per hour, but it includes paid vacation and sick time...which I've never had, uh, my whole life.  I tend to get good other benefits through contracting agencies, so not much difference there.  The big advantage is stability, but that doesn't actually help me until I've been there over a year, since otherwise it's business as usual...and even then, there's no guarantee I'd stick around for that long.

Does anyone who's been in this situation have a guideline for how much $salary generally equals how much $contract?  Is it, like, "Take your yearly income from contract, multiply by 0.85, and ask for that much"?  If so, what's that number?

[Il Palazzo]

Take a standard 40-hour week, your salary is [hourly wage]*40*52(weeks in a year).

Whoopsie, dumb me. You clearly were asking for something else than this simple calculation.

[Sowelu]

Yes, that's how much I make in a year as a contractor.

If I move to a fulltime salaried position, I can't ask for that same amount though, unless what I am asking for is a raise.  A contractor works 52 weeks a year.  A salaried employee works more like 49 (or less).  Salaried employees generally get better benefits, too, and there are often bonuses involved depending on industry.

[GlyphGryph]

Make sure to count your benefits in with there, assuming you get some. A lot can be directly monetized for purposes of calculation.

Contractors are, almost without exception, paid more. Because they don't get those expensive benefits.

Not just time off, but saved costs for health insurance, memberships in various orgs, tax benefits, and matching funds for invested earnings are all things to keep in mind. Salaried employees are also more likely to get year end bonuses, and are usually better in the long run as their pay rate increases faster.

[Mullet Master]

I am speaking in the broadest general terms possible here. I come from an engineering/construction/manufacturing background.

Contractors working for themselves generally earn 2-3x per hour that an equivalent salaried person would. There is a lot of reasoning behind this, but to put it simply, as a contractor you are not guaranteed any number of hours a year. Most find out that they only get to bill 1/2 their hours at most, the rest of the time is spent in not very useful things (quoting jobs, misc. paperwork, sick days, unexpected travel, etc.)

Salaried is usually bad news for most people, and the workload expects a greater than 40 hr/week effort. Most salaried people I know, in a varied amount of sectors, work minimum 45 hours a week, and most are closer to 50.
If I was going to go from contract to salary, I would demand a higher amount of vacation rather than try to negotiate a high salary.

If you want to calculate roughly what a salaried job is paying, figure these as value of benefits if you have no idea otherwise.
Insurance is roughly $500/person a month for decent benefits, or $6000/year. A 401K match is limited to a certain % of your salary, usually this is well known up front ( A typical value is 5% match).

So, Base Salary + Insurance Benefit Total + 0.05*(Base Salary '401K match') / (45 hours * [52 weeks - vacation weeks)])

[Sowelu]

In the places I've worked as a contractor, insurance is something that they give you the /right/ to buy, then you have to pay for it.  (Not having that ability is something you can negotiate for higher pay.) Is it the same in salaried roles, or is insurance in them typically an "oh hey, you get this"?

[nenjin]

Salaried is usually bad news for most people, and the workload expects a greater than 40 hr/week effort. Most salaried people I know, in a varied amount of sectors, work minimum 45 hours a week, and most are closer to 50.

This is what I was going to say. Where hourly employees may not be guaranteed a 40-hour work week, salaried employees are guaranteed to have that and more, because their labor cost is fixed.

I don't know if I'd call it bad news, if the benefits are what you need and you're in a company that will continue to give you raises. But it definitely means you're sacrificing more of your free time, and the words "on the clock" disappear from your vocabulary. Once you're salary, you're always on the clock and the understanding is that work, by and large, comes first.

Is it the same in salaried roles, or is insurance in them typically an "oh hey, you get this"?

I think your employer may cover more costs in the plans they offer you, and that coverage is essentially rolled into your pay in their eyes.

[GlyphGryph]

Different companies do it different ways. Mine has it come out of (pre-tax) income, bu at a significant reduction compared to contract employees (I believe) at all levels.

Contract gives you more flexibility, but it also means they have more flexibility as well - and no reason not to drop you the moment they don't need you, or vastly throttle back your hours. And I never enjoyed having to look for work again at regular intervals.

Its basically risk and reward vs stability. Salaried jobs will almost always pay less, but whether or not its worth it is a different story.

(Salaried positions also have a better chance of promotion and hierarchical advancement if thats your thing)

[Mullet Master]

(Salaried positions also have a better chance of promotion and hierarchical advancement if thats your thing)

Only in a generally good economy. They offer nothing but abuse in a poorly performing economy, with a few exceptions.

[GlyphGryph]

It really depends on the person and the company. I know people who have still advanced very quickly despite the economy. But the needs got to be there. Despite firing people left and right, many companies are still eager to find quality managers.

(I think my mom manages to become at least a manager in every job she's ever worked, even in the last two years, within three months. And been offered significantly more. 'course, she gets bored after less than a year and quits, but thats something else completely)

[LordBucket]

Does anyone who's been in this situation have a guideline for how much $salary generally equals how much $contract?  Is it, like, "Take your yearly income from contract, multiply by 0.85, and ask for that much"?  If so, what's that number?

It's not that simple.

Fulltime is clearly less per hour, but it includes paid
vacation and sick time...which I've never had, uh, my whole life.

Just a few things to consider that I haven't seen mentioned yet:

 * Sick time has zero value unless you use it, because if you aren't sick you'll be working and making that money anyway.

 * Vacation time is nice...but it's value is questionable, because again...you're simply being paid to not work as opposed to being paid to work. Without the vacation time, you would be getting paid for that time anyway. Having two weeks off to go to the Bahamas is nice, but having that time and an assurance that the job will still be waiting for you when you get back is the benefit here. That's not a financial benefit. Assigning it a dollar value is difficult.

Incidentally, if you're a contractor...can't you take time off whenever you want it anyway? Just tell them you're going away for a few weeks. You don't need their permission. Sure, they might not still need you when you get back...but that's the nature of being a contractor. More flexibility, less security. In general, company benefits are about feeling secure. How important is feeling safe to you? Again, it's difficult to put a dollar value of things like that.

 * As for things like health and dental...like above, they don't really have much value unless you use them. Plus, you need to know the details to even figure out how valuable they are even if you do use them. What's the deductible? For example, if their program has a $500 deductible, that means that every time you go to the dentist or doctor, any expense up to $500 must be paid by you. They only cover expenses above that. So...you might feel all nice about having your health benefit with a $500 deductible that on paper is theoretically "worth" $2000 salary per year, but if you visit the doctor 5 times over that year and each visit costs $300, you pay $1500 for those visits and the net value of the benefit to you was zero. Whereas if instead of having the health benefits "worth" $2000, you simply had $2000 more annual salary, you'd have paid the same $1500 in cash and would be $2000 ahead of where you'd be with the health benefits: $500 ahead instead of $1500 in the hole.

It's not my intent to simply bash salaries positions. They can be better. But don't assume that they are just because you expect them to be. If a company wants to move you from hourly to salaried, there's probably an incentive for them to do so. That incentive might be that they'll be able to work you more for less money.

You'd need more information than has been provided in this thread to make a proper determination. However...

"Take your yearly income from contract, multiply by 0.85, and ask for that much"?

...if your multiple is less than one, that means you get less money. I realize this is obvious. But I'm pointing it out anyway. Ask yourself if these other benefits they're offering you are worth receiving less money.

[JackOSpades]

This is a no brainier ALWAYS go per hour if you have the option.

Per hour = you get paid for being at work (and presumably working.)

Salary = you'll be making the same amount regardless of how much you work guess who is going to be the FIRST choice for working overtime, holidays, ect? that's right the guy that they don't have to pay for the extra hours. granted this also means you'd get the same amount even if you worked less but lets be honest with ourselves here the only reason companies reduce hours is to conserve money.

[nenjin]

On the other hand, non-salaried employees are the first cut, because re-allocating the additional work to them results in more hours which they must be paid for...whereas hours can be re-distributed to a salaried employee without increasing the labor cost. That's no guarantee if multiple salaried and hourly positions get cut....but in small companies where the pool of hourly employees is small, they'll be the first to go during lean periods.

[RedKing]

And in the US, having employer-provided (or even employer-subsidized) health insurance can be a HUGE benefit if you have any kind of medical issue whatsoever.

[Nadaka]

When I go from contract to salary I keep my same effective per hour pay, but gain benefits. This wont normally cost the employer any more because they no longer have to pay the headhunter agency