2 job offers and need help deciphering how PTO works

I don't know, but congrats on the job offers.

"In other words, does the annual salary INCLUDE days you take off from work?"

The succinct answer is YES. PTO is another name for vacation time.

Annual Salary is just that, as an umbrella for all of what you get. PTO means they won't dock your pay for taking off some allotted amount of 'vacation time' available to you. The allotted time may be accrued each pay period; e.g., 4 hrs accrued per 2 week pay period when starting out.

I notice you did not mention sick leave. It may be provided only as needed, "within reason", and not accrued.

Sometimes, PTO can only be accrued up to some limit, after which one has to "use it or lose it". There may be rarer cases where accrued PTO can be turned in for monetary compensation, in lieu of taking time off.

Salaried positions do not always include overtime pay (though the culture of a work environment may 'unspokenly' encourage one to put in the extra hours anyway).

jamin wrote:

I have 2 job offers and 1 is a salaried position that lists the compensation like

Annual Salary: X

Medical, Dental, Vision, Life Insurance: Y

PTO, Holidays: Z

Total Compensation: [X + Y + Z]

My question is about how the PTO and holidays are separated from the annual salary. Is this an accounting trick to boost the total compensation? In other words, does the annual salary INCLUDE days you take off from work?

I'm wondering because my other option is a contract job paid by the hour and I'm trying to figure which one actually pays more.

Seems like a little bit of sleight of hand. PTO should be part of "Salary." It's time you don't get docked.

it wit is wrote:

Salaried positions do not always include overtime pay (though the culture of a work environment may 'unspokenly' encourage one to put in the extra hours anyway).

But in lieu of overtime, there may be (either loosely or more formally defined) 'flex-time' for salaried employees, whereby they are expected to do what needs to be done to get the project finished, even if it means putting in later hours, but then they can occasionally come in to work later than normal, or take a longer lunch.

Nonetheless, there still are salaried positions where one has to fill out a time card (short of 'punching a clock').

It IS part of salary. Hourly wage when salaried is salary / (2080 - (PTO x 8)) when it comes to PTO so the more you have the higher your hourly wage.

oh please wrote:

jamin wrote:

I have 2 job offers and 1 is a salaried position that lists the compensation like

Annual Salary: X

Medical, Dental, Vision, Life Insurance: Y

PTO, Holidays: Z

Total Compensation: [X + Y + Z]

My question is about how the PTO and holidays are separated from the annual salary. Is this an accounting trick to boost the total compensation? In other words, does the annual salary INCLUDE days you take off from work?

I'm wondering because my other option is a contract job paid by the hour and I'm trying to figure which one actually pays more.

Seems like a little bit of sleight of hand. PTO should be part of "Salary." It's time you don't get docked.

it wit is wrote:

"In other words, does the annual salary INCLUDE days you take off from work?"

The succinct answer is YES. PTO is another name for vacation time.

Annual Salary is just that, as an umbrella for all of what you get. PTO means they won't dock your pay for taking off some allotted amount of 'vacation time' available to you. The allotted time may be accrued each pay period; e.g., 4 hrs accrued per 2 week pay period when starting out.

So what is the point of listing a grand total if it's not the actual total amount they're spending on you?

Also jamin when i was determining my hourly wage vs salary, if you're 1099 take into account the extra taxes, PTO, benefits, and the fact that you get no holidays paid into account. Theres probably some rule of thumb but mine came out to be +$11/hour

Hi Jamin,

I work as a programmer on contract. What was the actual $ offer for each? I've had both options on the table and depending on the difference can probably highly recommend one over the other.

it wit is wrote:

PTO is another name for vacation time.

Or even possibly 'vacation time' + 'sick leave', where they get thrown in together and you use them at your discretion; (sometimes thereby, in effect, possibly spending your 'vacation time while you are sick).

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PTO is paid time off. Your annual salary is what you earn assuming you work for the full year. If you use some of your PTO days (whether for sick, vacation or otherwise), you will not be docked any of your salary for those days off. Companies used to give separate vacation and sick days. If you happen to take more days off than your PTO days, you will lose some of your salary.

Some do but others decided it was easier to combine it in to one as PTO. Whether it is use it or lose it, gets paid out at one time, etc. is based on state law and employment policy.

"it wit is" stated "Salaried positions do not always include overtime pay (though the culture of a work environment may 'unspokenly' encourage one to put in the extra hours anyway)."

I am not sure what "extra hours" means. If you are salaried (meaning exempt per the DOL rules not company definition), you get paid for whatever you work. There is no such thing as extra hours or less hours.

If you are salaried (as in exempt per the DOL rules), you will not get time and a half if you work more than 40 hours per week but as long as you work 1 hour in a week and are willing and able to work the rest of the week, your company would be required to pay a full week's salary. If you are hourly (non-exempt - whether or not classified as salaried by your employer), you would be entitled to time and a half for any hour worked over 40 hours.

Do they offer paid basement leave time?

Don't worry about PTO. No company seriously tracks PTO. My last company cut me a check for $8K for unused PTO that I never claimed since I "was in the field". My current company, I barely submit official PTO and just take days off when needed.

Once you get in with the company, PTO is less important.

ya..... wrote:

It IS part of salary. Hourly wage when salaried is salary / (2080 - (PTO x 8)) when it comes to PTO so the more you have the higher your hourly wage.

Where is the constant 8 coming from?

From what I understand now, an offer in X-Y-Z form means, in layman's terms,

"The cash we directly pay you for the next year amounts to X. You are allowed to take 8 holidays off and 15 other days off during that period."

How much were you offered?

obviousguy wrote:

How much were you offered?

Not much in either case -- about 2/3 of what a level-1 developer at a brand-name company makes.

Compensation in the tech world does not follow a consistent rule. I've seen Indian outsourcing firms paying highly skilled .NET developers $12/hr at Microsoft. That is not a joke. At the same time, I've known people with entry-level skills who join a startup company that pays them $90/yr and they spend a lot of their time smoking weed inside the office.

Youve actually SEEN this? When did you travel to India?

jamin wrote:

ya..... wrote:

It IS part of salary. Hourly wage when salaried is salary / (2080 - (PTO x 8)) when it comes to PTO so the more you have the higher your hourly wage.

Where is the constant 8 coming from?

From what I understand now, an offer in X-Y-Z form means, in layman's terms,

"The cash we directly pay you for the next year amounts to X. You are allowed to take 8 holidays off and 15 other days off during that period."

8 hours in a day.

jamin wrote:

obviousguy wrote:

How much were you offered?

Not much in either case -- about 2/3 of what a level-1 developer at a brand-name company makes.

Compensation in the tech world does not follow a consistent rule. I've seen Indian outsourcing firms paying highly skilled .NET developers $12/hr at Microsoft. That is not a joke. At the same time, I've known people with entry-level skills who join a startup company that pays them $90/yr and they spend a lot of their time smoking weed inside the office.

You forget that those Indians are getting H1B1s too so it's not a fair comparison. And 5 years into consulting, I've still never seen a rate close to that low.

PTO is Parent Teacher Organization. You are obviously working for a public school system. Good for you!