Workers who are paid by the hour are less likely to do volunteer work than those who are on a salary. And even salaried workers become less willing to volunteer their time once they have calculated how much they are being paid by the hour.

People learn ways of thinking and decision-making at work that they often carry into other spheres of their lives. Specifically, they develop a particular psychology of time and make decisions about the way that they use time based on the time-related management practices to which they are exposed.

One of these practices – being paid by the hour – predisposes people to assess how they spend their time in terms of the monetary returns from their decisions. Other ways of paying people also affect how they decide to allocate time. For example, if people earn bonuses based on doing certain tasks, they are less likely to spend time doing other things, for example helping their colleagues.

Alongside this, when people use a financial value as the sole way of measuring time, they tend to discount the worth of other activities, such as volunteering, where the economic value is harder to calculate.

Our research showed that when people focus on the economic value of time, they are less likely to want to do things that they are not paid for. This means that they volunteer less often and spend less time on volunteer duties.

It also affects other decisions that they make about time use: people paid hourly spend less time on religious activities, personal care, sport and household activities than do their salaried counterparts.

The vast majority of recent research on time has focused on how little of it people think they have outside work. We argue that the way in which people are paid plays a powerful role in their evaluation of how to spend their nonwork time and even their psychological perceptions of how much free time that they have.

For instance, although employees often say that they want to work less and have more flexibility, time-based payment can decrease the likelihood that they will actually act on those preferences.

Adapted from Hourly Payment and Volunteering: the Effect of Organisational Practices on Decisions About Time Use, by Sanford DeVoe, of the University of Toronto, and Jeffrey Pfeffer, of Stanford University.

First published in Academy of Management Journal 2007, Vol 50 No. 4. www.rotman.utoronto.ca/newthinking

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