Woohoo, a bonus day! Or is that just to our employers?
Deviating from my usual content, I thought it’d be fitting to hop on today and talk about this question, because I think there’s more to it than meets the eye and it might be worth discussing! So, allow me to share some perspective.
For background, I’m a public accountant (although perhaps not a very traditional one), and at the moment, we are right in the heat of busy season. This is a particularly heated busy season, which I’ll circle round to down below, but let’s just say there’s a lot of overtime being done right now. Nobody’s really celebrating this on account of the looming burnout, but technically having the extra day in February gives us an extra day to get all the February “tax stuff” done, and if you’ve got taxes due at (or contributions to make by) the end of February, you’ve got one extra day for that as well.
Again, just a little perspective.
So, are you working for free on February 29th? In the great tradition of accountants everywhere, the answer is: it depends.
If you’re paid by the hour, then you’re probably good – you’ll work your hours today, and you’ll get paid those hours, just like any other day.
If you have an annual salary, we have more to talk about.
Let’s forget overtime and bonuses and such, and just say for simplicity you have a salary of $100,000 per year. The simple answer is: If you are paid $100,000 for the year, whether February has 28 days or 29 days, then I suppose you are working for free on that one day.
But hold on, let me overthink this – what exactly is included in that salary?
It could be that you work whatever hours you need to work so long as you’re meeting the responsibilities set out in your job description. Then the answer depends on whether you needed that day to get your work done anyways (you’re being paid for that day), or whether that extra day somehow created more work for you (now you’ve got more work for the same salary, you’re working for free).
That salary could require you to show up to work Monday through Friday and be present 9am to 5pm. In this case you have to show up the extra day for the same pay, and you might consider yourself as working for free.
If you’re like us, it might be a mix of the above – be present for certain hours, work overtime to manage our workload as needed. In our circumstance, if we didn’t have that extra day, we’d still have to do the same amount of work we’re doing over 29 days, but we’d have to do it in 28 days. Some of us get paid overtime, so maybe they rather have had the overtime on top of their salary and they are “working for free”, but for those of us that don’t get paid overtime, I think it’s neither here nor there – we are just getting paid to do the work.
This got me thinking about the way in which we value our time.
When you think about your salary, do you think about it on a dollar per hours basis? Do you think about the extra work (or extra time off) that is baked into that number? Are you technically paid more if you’re very efficient (by doing the same work for the same pay in less time)?
You see how a salary can be deceiving? Let’s go back to the $100,000 salary, and say you’re working certain hours plus “unpaid” overtime as needed. Okay, so is that $100,000 salary only covering your Monday to Friday, 9 to 5, and your overtime is for free? Or does $100,000 cover Monday to Friday, 9 to 5, plus 400 hours of overtime per year? And this is before we get to things like benefits, paid sick days, bonuses, and other flex time and paid time off.
You could check the market salary for your position, sure – but to be truly comparable, you have to consider all of the duties and responsibilities and all of the hours (and other unknowns) that could be reasonably included in that salary. At the end of the day, you have to know how to value your time.
How do you value your time?
I thought that this was an interesting question to bring up for the entrepreneurs out there, whether offering services or products. Consider services, and say you set a rate of $100 per hour because that seems to be the going rate for your service. Okay, now exactly what time is baked into that fee – does it cover preparatory time? Research time? Administrative time? When do you start and stop the clock?
What is your time really worth?
Sorry, I don’t have an answer – but it’s a question worth exploring later. (Okay, at a high level, it’s probably some combination of the comparable market rate for time doing what you do and then modified for your unique experience, ability, positioning, market…) In the meantime, the point I’m making is that the answer is nuanced, and I think we would all benefit from considering the way in which we value our time.
Personally, I don’t mind whether I’m working for free or not today. One day every four years works out to a quarter day per year plus time value of money. I’ll take the two hours and use it to try and get out of this tax season!
Without getting into detail (this is a personal for-fun blog and not a tax blog), here in Canada the tax legislation that has been coming out over the last number of years has had everyone jumping through hoops. (Not quite to the level of lunacy as Trump’s “postcard-sized tax return”, but still pretty costly for the “benefit” in my opinion.) After the whole Underused Housing Tax debacle (which after all that ended in a last-minute filing deadline extension) it sort-of feels like we’re being… messed about.
The latest development has us increasing the amount of sensitive information disclosed on trust income tax returns, and worse still, creating new filing obligations where none previously existed and let me tell you – this one is going to surprise a lot of Canadians who had absolutely no intention of creating a trust arrangement with a reporting requirement, and yet now they have one. Write your MP on this one, folks.
Until next time!
Okay, two asides:
- I feel like I need to wish all the Leap Year Babies a very happy birthday, since you only get to celebrate on the date once every four years!
- This is probably the first time that I’ve came up with an idea, drafted it, “edited” it, got graphics done for it, and posted it all in one sitting. Woohoo! Should I be working? No. First of all, I’m taking my two free Leap Year hours. 😀 Second, this is my hobby – it’s like painting but with words. I could be unwinding to Netflix right now, but this is marginally healthier.
