A long time ago (around 1991) a friend of mine named Dan was a contractor for the aerospace company I worked at. Somewhere along the line Dan decided he was going to leave that company to take a permanent job elsewhere, as he had a medical problem and wanted to get better insurance. Upon telling my employer of his plans, the employer came back and said "What if we make you a full-time employee here?"

So they proceeded to embark on some negotiations, but the process hit a snag. Because of his medical problem my employer's insurance wouldn't pick him up.

At this point something got messed up in the negotiation process, and when Dan went back to talk to my employer he thought he was talking about a full-time position, while the employer thought they were talking about keeping him on as an hourly contractor. So the employer asked "Dan, how much would you like?", to which Dan replied "80". Fortunately for him he didn't say what he really meant, which was $80K per year, he just said "80".

Sitting in the other chair, the employer was stunned that he would have the balls to ask for $80 per hour (remember, this was 1991), but since he was very good at what he did, they said "We'll have to get back to you", and eventually they did, giving him the $80 per hour they thought he asked for.

Yes, that's $160,000 in 1991 money for the 2,000 work-hours in a typical year, not to mention the extra pay for overtime we always pulled (up to 20 paid hours per week). Working the math in my head, and assuming a cost of living increase of 4% per year, that "80" would be worth over $320,000 in salary in 2007 -- without considering the overtime(!).

I think of this sometimes, and I wonder if good employees don't realize how much they're really worth to their employer. Hopefully this true story about Dan sheds some light on what employers will do some times to keep very good employees.