What's an Hour of Your Time Worth?

For anyone who earns an annual salary, this is an important question to ask yourself. It's this particular unit of time that determines, for example, how much you make when you put in for OT (i.e. what integer actually gets multiplied by 150% for 'time and a half'), how much you need to pay if you want to use an extra day of vacation or annual leave, and it may play a role in determining certain company bonuses, amongst other things.

The first place to start is by figuring out the total number of hours you will work (or are typically expected to work) in a given year, and multiply that by the number of hours you should work in a given day, minus lunch of course (e.g. 7~8 hours per day). Then you need to figure out of your company factors in any additional working hours.

At least in Korea, most employers have factored in an additional 20 hours of extra work per month (this is referred to as 기준연장).

If your employer also factors in such extra work time, you must add that to the total expected number of working hours per year. So, for the case of most people in Korea, at least until next month, that means they must add an additional 360 hours of work to get the total number of expected working hours per annum.

Once you have that figure, you simply divide your annual salary into that. For example, if you're employed in Korea and you earn USD 200,000 per year and you're expected to work a total of 200, 7 hour work days (lunch excluded) in any given year, after factoring in the extra work you're expected to carry out in a given year (which in Korea is 360 hours per year), that means you will work a total of 1760 total hours giving you an hourly wage of approximately $114. So, getting back to OT, that means you will earn about $170 per hour of overtime if you are paid 'time and a half' as most employers do, particularly on weekends.