Tech Startup Buffer Publishes Every Employee's Salary, Right Up To the CEO

Hugh Pickens DOT Com writes "Paul Szoldra reports at Business Insider that Joel Gascoigne, CEO of social media startup Buffer, reveals his salary along with the salary of every single employee in the company, and includes the formula the company uses to get to each one. "One of the highest values we have at Buffer is transparency," says Gascoigne. "We do quite a number of things internally and externally in line with this value. Transparency breeds trust, and that's one of the key reasons for us to place such a high importance on it." Gascoigne, who has a salary of $158,800, revealed the exact formula Buffer uses to get to each employee's number: Salary = job type X seniority X experience + location (+ $10K if salary choice). Gascoigne says his open salary system is part of Buffer's "Default to Transparency" and says Buffer is willing to update the formula as the company grows but hopes that its focus on work/life balance fosters employees that are in it for the long haul. "In Silicon Valley, there's a culture of people jumping from one place to the next," says Gascoigne. "That's why we focus on culture. Doing it this way means we can grow just as fast—if not faster—than doing it the 'normal' cutthroat way. We're putting oil into the engine to make sure everything can work smoothly so we can just shoot ahead and that's what we're starting to see.""

Comments

It's more like a stunt to me

[Taco Cowboy]

Sounds like something they'd do to placate "dumb money" angel investors

I do invest in startups and most of the angel investors that I know are not dumb.

That guy is running a publicity stunt.

Transparency can only work up to a point before jealousy creeps in.

There is no way to run an organization with 100% transparency - people will start comparing each others' workload (and/or contribution) with the salary figure.

The art of managing is an ART and it's a very delicate task.

Re:It's more like a stunt to me

[Anonymous Coward]

Transparency worked pretty well back in the 50's when most jobs were unionized. Everyone knew what everyone else was paid and everyone worked their fair share because the company wasn't focused solely on posting record profits.

People need leadership, not management. That's a distinction this generation has no concept of as it fell out of fashion back in the 80's. You manage boxes and machines, but you lead people.

Re:It's more like a stunt to me

[PopeRatzo]

There is no way to run an organization with 100% transparency - people will start comparing each others' workload (and/or contribution) with the salary figure.

And that is bad because...?

The art of managing is an ART and it's a very delicate task.

And if you don't believe that, just ask a manager. His work is an ART and it's very delicate and that's why he's entitled to 500 times the salary of someone who works for a living. If you ask, he'll even write a book about his ART and the great delicacy and importance of his work and why he needs to get grandly compensated if he fails and gets fired.

Re:It's more like a stunt to me

[XcepticZP]

I call bullshit on this. Union membership was never "most" or a majority of the population. The highest it has ever been in the US was in the 50's when it was in the low 30s% range, and has been declining steadily ever since. Probably as a consequence of people realizing that unions have done all they can for worker rights, and all they're interested in now is keeping their power/income at the expense of workers' and the companies both. I didn't even have to look hard for this stat, as it's already on Wikipedia here.

From what I've heard union members negotiate salaries based on seniority, and not on any sort of merit. It may bring security/assurance to a lot of people, but it does not distribute fairly according to effort/skill.

Re:It's more like a stunt to me

[Immerman]

Well, I'll take umbrage to the idea that unions have done all they can - in the last few decades management has managed to undo virtually all the gains in profit distribution that the unions' ever managed to accomplish, with virtually all productivity gains of the last 30 years going exclusively into the pockets of management while inflation-adjusted worker wages have remained stagnant.

I won't argue that many unions have become part of the problem though. It's the same with any "government" - things can start out with the best intentions, but if you don't keep your representatives firmly bound to your will then it won't be long before they start taking advantage of the power you've given them to benefit themselves at your expense.

Re:It's more like a stunt to me

[PopeRatzo]

Middle management is not really management. They exist to give real management somebody to blame. None of the ART of management that Taco Cowboy was referring to enters into the life of a middle manager. They're just going down checklists and trying not to draw attention. They get paid as badly or worse than the bottom level workers. The 99%-1% model exists in corporations the same way it does in society generally. There are only two categories of employees.

Plus, I'd have to start taking responsibility for investor's greed, which I could never bring myself to do.

Nobody at the C-level takes responsibility for anything. Responsibility is an outmoded concept. Just look at the 2008 banking cock-up. The few criminal investigations there were took place at a level well below the C-level. Or, the fines attached to prosecutions were a tiny fraction of the windfall.

If you neglect to put $1 in the parking meter, you face a $75 fine. If a corporation steals $10billion, the fine might approach $1million, but no more. In this way, accountability is always shifted downward.

Re:It's more like a stunt to me

[bledri]

Let's say one of your unionized coworkers came up with and lead the implementation of an idea that would save your company $5M or increase revenues by 10% over the next year. What would their expected reward be? If a different company saw that result (or potential) in that same coworker, what might they be willing to extend in terms of a job offer to that person?

You're kidding right? I used to work for a huge hardware/software company back in the day. My "real job" was to work on the OS, but I was also sent all over the world to "save" $50-150 million dollar sales on multiple occasions. I busted my ass and did some pretty damn good work - if I say so myself. Know what I got? $500, a plaque and a pat on the back for going above and beyond. I also got to keep my job and got a minor promotion. Which is exactly what would happen to the union guy - he'd get a few hundred bucks, and a bump to his pay grade (aka, a promotion.)

What about the other stuff?

[rolfwind]

Do they also list the stock ownership ,stock options and bonuses of every employee too?

No snark, genuinely interested in how far transparency goes and how far it has to go before transparency is actually achieved.

And what is the goal?

I know some people that do the work of 4 of their colleagues, would it be wrong to pay them 4x more? Afterall, the company still saves on healthcare, parking spaces, and other redundant costs. What a person is worth is not always reducable to a position.

Re:No respect for employee privacy

[SJHillman]

Is it respect for employee privacy or respect for being able to pay drastically different wages for the same job? A lot of times, company rules (official or unofficial) against discussing salaries protect the employer much more than the employees.

Re:Here's my proposed algorithm.

[Joce640k]

Sure, but first you have to invent the Star Trek replicator and holodeck. At a price that everybody can afford.

Re:Contribution?

[psperl]

This is not true, especially with software developers. I manage quite a few of them, and it doesn't take long to be able to determine their approximate individual worth, without metrics. Activities outside of writing code are hugely influential to an employee's value, such as educating other team members and communicating with customers or our business sponsors. Obviously I can't pinpoint an exact number, but its obvious as night and day who the real catalysts are within the group, and I can adjust accordingly.

Companies that don't link your wage to your individual abilities are trying to take advantage of you. Plain and simple. I say trying, because one day it'll backfire. The most profitable companies that depend on skilled labor (not Walmart or McDonalds) pay their employees well, and do not use a uniform pay scale.

Re:No respect for employee privacy

[Anonymous Coward]

I don't care what others get paid, it is up to me to negociate a salary with my employer.

So you're perfectly happy to go into negotiations at a disadvantage, knowing that the employer has relevant information that you don't have?
You sound like a shitty negotiator.