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The Microsoft Salary and Review System
f1055man writes "If you can make it through the obvious bias, Washington Alliance of Technology Workers (WASHTECH) has put together a revealing article on Microsoft's salary and review system. 'Internal Microsoft documents obtained by WashTech News show that Microsoft salaries have been stagnant or nudged only slightly higher over the past two years. Comments from current and former employees about the company's compensation and performance review system suggest a growing level of frustration among rank-and-file workers.'"
In the end, maybe it just maybe the time to move on...or better still start something on your own.
When I didn't get the raise I wanted, I didn't get all pissed off; I didn't even go look somewhere else. I just started my own computer repair/networking/etc. business on the side. It's been over a year now, and it's been a huge blessing both monetarily and in other, less tangible ways. There's probably not a person reading this that couldn't do the same. There's always more money to be found out there. Before I had my current skill set, if we started having trouble making ends meet, I'd just take on another shitty dishwasher-type job for a while. Thankfully now I'm able to be a little more entrepreneurial about it. Just wish I had the balls to do it full time...
I am not left-handed, either!
To be honest, I don't see a lot of reason for discontent over 'stagnant' pay comming from rank and file workers at Microsoft. I haven't noticed any major fluctuations within IT job market as a whole when it comes to pay rates in the last two years. And the whole situation becomes even less surprising if one takes into account these two factors:
Company size. Microsoft is not a small business, nor medium, nor even a large one. It's humongous. Thus, it is not really practical to talk about giving raises to i.e. top 5% or 10% performance employees like so many other companies do. In fact, even giving raises to just top 1% of employees still would bump the salary budget significantly every year.
Benefits. From what Net has been saying for years now, Microsoft's benefits and policies really don't suck. From stock options to silly things like 'nap time' during work hours, being a med-level employee for Microsoft doesn't seem to be really all that bad. Just as you check 401K and other benefits when considering work for Sun, IBM or any other IT (or non-IT) company, so too you should consider Microsoft's benefits before you complain about your stagnant pay.
Regarding elements of the article I find interesting: According to employees, who said they would be fired if they spoke on the record, the annual review amounts to little more than a closed-door popularity contest in which managers "fight" for higher scores for their team, or defer to higher-level decision makers who mandate how many workers drop to the bottom of the review scale. - this is definitely nothing unusual. In fact, if my manager didn't fight tooth and nail to prove that me and my team are better than other teams and get us raises or bonuses, seriously, I wouldn't have too high an opinion of him. Likewise, I have to notice that article focuses on salary itself - there is nothing in it about bonuses and incentives that I could find. Having a spouse who works for a major IT industry, I have to say I'm regularly stunned by the sums on her 'chrismas checks', 'yearly performance bonuses' and other 'small' things like that - they certainly make a significant portion of her yearly income (and regularly mess up our taxes, too).
'...computers in the future may have only 1000 vacuum tubes and perhaps weigh 1.5 tons...' Popular Mechanics, 03/49'
I certainly agree raises are not an entitlement,
and businesses have constraints on how generous they
can be.
But one large factor that affects salary costs is
that hiring for top quality, highly productive people
is very competitive. You may have to match or beat other
employer's offers to get them on board and retain them.
Run of the mill folks may not get raises, but you need
to make sure your top talent is not walking out the
door.
Companies that are owned by stock holders are only interested in profits, and then only as a way to boost stock share prices enough for them to sell for a gain. That means companies with stock holders do stupid things like fire 30% of their staff to make a profit or create short term gains at the cost of long term growth, thus threatening everyone's jobs.
I'd suggest anyone working for such a company to quit.
The company has no long term investment in you and would fire you in a minute if it meant their bottom line would increase their stock values. Half the time they aren't even looking to be more profitable... they just want to increase stock prices. The trend of not paying dividends has left public held companies in bad standing.
What you should be looking for is a small company that will value you and where replacing you would be painful and where making you a better and empowered worker wont threaten the employer with ideas that you'll run away with your new found skills.
Or better yet, start your own company. If you are working for a company (if a company pays you) you're obviously worth twice that. They can't make a profit on you if you aren't.
Here's one reason you're feeling poorer: You're being gouged on property taxes. In my neighborhood the market price of condos has more than tripled in the past seven years. If tax rates remain the same that means taxes have tripled. But have school enrollments tripled? Have police salaries tripled? Have there been three times as many fires? No, no and no. Rising real estate prices have become a money grab for politicians. You need to get involved with your local politics and insist that property tax rates be adjusted downward so that what you pay reflects the true cost of delivering municipal services.
Insert witty sig here.
This inflation creates cost of living increases (including the housing bubble in my opinion). Because of this inflationary cycle, people demand cost of living increases.
The housing bubble was created by a complete lack of confidence in the stock market. The investors then put more money into land, tying up a greater percentage of it and causing the prices to go up. If they sell land to put the money back in the stock market, the market will jump 10% in a month, and the price of land will drop 10-30%. Hopefully they won't all go at once and make the big popping sound.
But, back to the topic at hand, if you recognize inflation as something that happens, and something that won't go away, I can't see how you complain about raises as a matter of course. The employee costs you the same this year as last if you give them the 2% raise. You say they should get the same, unless they distinguish themselves, so you should be giving them a raise by what you said. However, it seems that you hate the government and take it out on your employees. Like you are trying to convert them to gold-standard nuts or something by blaming their lower wagers each year on the government. But, since it is a factor you are aware of and can correct for, your conscious decision to lower their buying power is the act that hurts them, not inflation.
Learn to love Alaska
The problem is that this is an industry wide trend. "Moving on" to something better is becoming harder, because stagnation and explotation are becoming the norm. And when that becomes the norm, you just move on to more of the same.
It's great if you can recognize your own worth, but that dosent matter much when the people that sign your paycheck know they can pay you whatever they want because your completely replaceable.
My perception is a bit bitter though, being in Michigan and seeing people offer seasoned programmings less then high school drop outs doing construction wears on one quite quickly.
When an employee knows they are overpaid, is unsatisfied with their job but has not vacated, it's usually indicitative that they know they will not be paid as much in another position. So next time you hear someone complaining about their employment but vacated for a lengthy period of time, there's a fair chance they are being overpaid.
For he today that sheds his blood with me shall be my brother.
I prefer this slow deflation versus inflation.
In a fixed money base (let us call it a 100% gold-backed reserve banking system), there will be more people and more products chasing the same quantity of money in the system. This means prices will fall as everyone tries to attract people to their goods and services. Over time, wages fall, but so do prices.
This is a GOOD thing. If you have $1 today, you want to spend it because you know in 1 year that $1 is worth less. In a free market, when you have $1 today, you want to save it because prices fall over time.
When you save money in a free market, you generally give it to a bank. In a free market with the Fed, banks that need money will offer better interest rates (not the 1% you get today). By investing that money in a bank, they are free to loan it to stable businesses with good business plans and equity, who are able to pay the loan back. They'll also loan it out to homeowners, but at a much higher interest rate than we see today.
Higher interest rates all around mean more wealth is created for everyone, rather than the quite theft that inflation takes from us, that confuses the entrepreneurs and that creates a massive amount of debt for your children and grandchildren to pay back. The US currenty has debt and off-book liabilities totalling over US$70 trillion. We can never pay this back, so we shove it to the next generations.
I'm a moral guy, and I think this is wrong. I'd rather live poorly than make others pay for my mistakes. The rest of the country would rather live beyond their means and let others pay for it.
This happens because all those foreign central banks believe that having tons of dollar bills stored equals their countries being "rich" (much in the same way as the XVII century merchantilists believed that having tons of gold stored away meant their countries were "rich"). Since all these bills aren't running around in the real American economy, they don't make prices go up.
This is so true, and most people do not realize this. Our economy is _very_ fragile because of these foreign stores of our cash. I personally believe the Iraq was was entirely based to maintain this economy. Iraq in November of 2000 decided to start trading oil in Euros, not US dollars, which would have greatly watered down our foreign reserve bank status and inflation could start getting out of control. Do a search on "November 2000 iraq euro dollar" if you don't believe me. We will see what happens if Venezuela switches like they talk about from time to time.
Imagine having to use a shopping cart full of money to buy a loaf of bread? That's inflation.
It could be significant because MSFT has been doing it while increasing their quarterly profits. When a company needs cash and stiffs their workers on salaries it's a lot more understandable than a company that still manages to increase their quarterly numbers. It would breed a lot of resentment among the rank and file.
It might really be significant if MSFT had to stiff their workers to increase quarterly numbers. Their sales are nearly pure profit, billions in cash every quarter. And they're telling their employees "No soup for you!"
Doesn't make sense. MSFT is not an airline or a smokestack industry. Their sunk costs are pretty insignificant compared to their cash profit margin. For a cash rich company this behavior is oddly out of synch with their earnings.
That's our life, the big wheel of shit. - The Fat Man, Blue Tango Salvage
It's amazing the kind of garbage the anti MS crowd can pull out of their asses sometimes. Wages at microsoft might be capped, but that doesn't mean much when they make a shitload of money. I have a college friend who they practically threw a job on. He wouldn't tell us how much he would get paid, only that it was "above 50 grand". Mind you he isn't some genuis programmer, he's good but still has a lot to learn. Trust me, the last people you should be sobbing about in terms of earnings are MS employees. Working for them will make you a lot more money than most software companies, -especially- when you're just starting out. Then if you really think they're not paying you enough, get bought out by google (just make sure to duck when the chairs start flying).
Joel Spolsky, who has a nice blog called "Joel on Software",
wrote a very thought provoking article back in 2000. It is
called "Incentive Pay Considered Harmful".
He discusses how *not* to manage smart, highly educated employees.
Since Joel is a programmer who used to work at MS, his case comes directly
from Redmond.
Quem a paca cara compra, paca cara pagará.
There are actually two critical issues here. The first is that should companies be obligated to give raises to a large percentage of their workers. The second is whether or not the company is creating an evaluation process that actually rewards performance. Almost all the quotes from employees at Microsoft were not against the idea of rewarding only the top performers but more the claim that the evaluation process is driven by politics instead of a fair-minded view of real accomplishment.
If you create a system where you give the majority of the money for raises to a select subset of your employees, you are sending a clear message to the other employees that they should consider working elsewhere. Whether your evaluations are fair or not, there is no way that all the employees who get the lower evaluations are going to be happy about the situation. Certainly Microsoft should not be surprised if an employee decides to leave because of an insufficient raise. In fact, Microsoft should expect it. I would consider receiving below a cost of living raise to be a clear signal that in a tougher economic climate I would be fired.
The real problem with running large organizations is coming up with fair methods of evaluations. I would very much like to hear from those in Microsoft who might defend their current methodology. A few quotes from unhappy employees who disagree with their evaluation does not even come close to a true indictment of the system.
The value of my home just went up by $146,000 this year alone -- and before you start accusing me of being too greedy, know that I'm not interested in selling, just living here. All that extra value is pure fluff, the stuff that dot-com stocks were made of. The problem is, I'm being forced to pay property taxes that are going up at the rate of 25% a year just to keep my house.
This is why property taxes applied to residential homes are simply a flawed concept. Unlike almost every single other asset I own, my home appreciates in value and I, usually, have no desire to sell. The government penalises me because others lust after something of mine that I don't even want to sell.
Treating peoples' homes like assets is destestable anyway. It's not a credit on a piece of paper to me. It's my home. I live here. To be forced out of your own home due to the actions of others is really a disgusting concept. The worst part is, if you tried to make your home look delapidated to drive away the investors, you would be sued!
May the Maths Be with you!
We generally try to do our best and are honest and sincere. However, management isn't always so. Some of their reasons for grading aren't work-related but "cover my arse from spanking by higher management" related.
They may place an employee in the worse end of the bell curve mainly because they are expected to show that they are tough, that they can take tough decisions and fire an employee.
Your call to work honestly and all that assumes that the world you are dealing with is honest. Many of these guys [managers]would fit right in the crowd of used-car salesmen and even outsmart them.
The other problem with said company which can be extrapolated to banding in general is that technical bands get capped much lower than management bands. In the case of the company discussed above, technical bands were capped at $110K with most positions starting at $70K. First-level managers started at $100K and were capped at $150K.
If you'd like more of my rantings for your book, reply with questions and an email and I'll drop you a line.
Still, with a plan, you only get the best you can imagine. I'd always hoped for something better than that. -CP
I'm not even sure we need to be unionized in high-tech to run into the issue of purging the dead wood. I work for Intel, and in my 5 years there, I've seen a number of people not performing, yet they remain. I also hear stories from the old-timers about people not getting terminated due to performance issues. What it comes down to is the legal ramifications. You want to see someone who doesn't do their job get motivated? Try and fire them...they have lawyers crawling up the company's ass in no time. Why? Because they can, and for companies like Microsoft and Intel, they have the deep pockets that make it difficult to terminate someone, even if you can prove they weren't competent. It will come back that the company should have done something to put them into a position they'd be more competitive in. The only time I've ever seen *anyone* get fired at Intel in the engineering side is from people surfing for porn, and people who made physical threats to other people. I have yet to see someone let go based on job performance issues. Unions? No, we don't need them. We have lawyers.
My brother makes a decent living doing this in the Northern UK. He's in the yellow pages rather than online, since most of his customers call him because their computer is messed up and they can't get online.
I believe he sells video card, memory, processor upgrades, but the bread and butter is fixing messed up PCs.
-- "It's not stalking if you're married!" My Wife.
One good thing about living in California is that the property taxes are limited to the value of the home when you purchased it. I think the law allows some tiny increase every year, but in practice even a tiny increase rarely happens.
Of course, real estate here is insanely expensive, so any new buyers are paying quite a bit. Some retired person who bought their house back in the 1950s, however, is probably only paying about $150 a year in property taxes. That's generally a good thing, in my opinion, because the retired people living on social security would all be forced to sell their homes if they had to pay property taxes on current values.