Slashdot Mirror
Company Testing Standardized Salaries Is Struggling
jmcbain writes: In April 2015, Dan Price, the CEO of online payments company Gravity Payments based in Seattle, announced that all employees would have their salary bumped up to a minimum $70,000. Slashdot covered this news. Since that time, however, things have not gone well. Some employees quit because they felt it was unfair to double the pay of some new hires while the longest-serving staff members got small or no raises. Furthermore, after reducing his own salary from $1M to $70K, Mr. Price is now renting a house 'to make ends meet'. On an unrelated note, Mr. Price's brother, who is a co-founder of the company, is suing him.
Almost, there are some extra pay/bonuses for certain things.
...except that's not actually true.
For example, there's been the long-running practice of reenlistment bonuses. Different jobs get much higher bonuses for reenlisting.
The base pay may be the same, but the difference between, say, a low-ranking cook and a low-ranking nuclear weapons technician is pretty startling when that bonus is calculated. As in "tens of thousands of dollars."
Having run a company, I can get this...it's a refreshing and seemingly decent approach to sharing the wealth.
Great contrast to all the money-grabbing, "screw the employee" bosses that are in the news all the time.
Maybe where he went wrong is not allowing an "upside".
Sure, not everybody who *thinks* they deserve extra really do.
But in my experience some sure as hell do...the trick is to identify them and give them fair value.
(My top staff regularly got 20% over market rates - they earned me far more, so I was happy to pay.)
Snip: "You can ignore economics, but economics won’t ignore you.
That’s the tough lesson Dan Price, CEO of Gravity Payments, a Seattle credit-card processing company, is learning.
Four months ago, Price announced he’d slash his own multimillion-dollar pay and set a company-wide $70,000 minimum wage.
He got the idea after a friend explained her difficulty paying back student loans and surviving on $40,000 a year — a salary many Gravity employees were making.
Price’s stand against income inequality made him an immediate darling of the left.
But key employees saw it differently.
Financial manager Maisey McMaster liked the idea at first — until she thought about it.
“He gave raises to people who have the least skills and are least equipped to do the job,” she told The New York Times. Meanwhile, “The ones who were taking on the most didn’t get much of a bump.”
She thought it would be fairer to give smaller raises, with the clear chance to earn more with experience. Price brushed off her doubts; she quit.
Also out the door: Web developer Grant Moran. He says, “Now the people who were just clocking in and out were making the same as me.” Plus, having your pay level a very public matter is a problem, with “friends now calling you for a loan.”
Moral of the story: Some people work harder than others; some have stronger skills — and they don’t think it’s fair that they’re paid the same as others.
Price will soon be left only with workers worth his chosen minimum wage — or less.
The company is already in chaos thanks to the policy — but the big problem is ahead, as it tries to keep growing and innovating with only mediocre talent"
Emphasis mine. The NIR Act established the first minimum wage in America (this was struck down in 1935, ruled unconstitutional by the SC, but a subsequent Act establishing a minimum wage was upheld by the SC in 1941, under that magical Commerce Clause.)
Granted, he doesn't say the family size that decent living would support, but lacking statements to the contrary I assume at least a three-person household. But a temp wage? No, that does not appear to be the intention of it. Big business and our government has twisted and contorted it over the decades to be just a minimum wage paid to people... but if it can't cover life's basics, then what is the point of it at all?
He just wanted to take a cheap shot. Occupy was about the system being corrupt, nobody was demanding the communist utopia he's implying.
people are leaving because they dont feel valued when someone who just got hired is making as much as them, having been there for 10 years.
have you seen my sig? there are many others like it but none that are the same
...except that's not actually true.
For example, there's been the long-running practice of reenlistment bonuses. Different jobs get much higher bonuses for reenlisting.
The base pay may be the same, but the difference between, say, a low-ranking cook and a low-ranking nuclear weapons technician is pretty startling when that bonus is calculated. As in "tens of thousands of dollars."
It's not just re-enlistment bonuses. Some people get additional pay every month or year depending on their job. To cherrypick an extreme example, the military doctor who happens to hold O4 or O5 rank makes tens of thousands (if not $100K) more than the average line officer of similar rank.
John Galt, the pivotal figure in Atlas Shrugged, once worked as an engineer with the fictional Twentieth Century Motor Company. After the original owner died, his heirs decided that employees would work according to their ability, but be paid according to their needs.
Needless to say, it did not work out well.
"At least that guy is allrigh as he only wasted own money"
Not true. His brother (who is suing him) who co-founded and owns part of the company had his interest destroyed by this lame experiment.
I don't think there was a single unified message of the occupy movement. Either way, "nobody" is too broad. I saw more than a few signs and videos of communist utopia
I tried. I got the book and started reading. When I got page 100 I stopped and thought about what I had read, which was nothing. Whatever story she tried to tell in that book, she took her sweet time in getting the plot going. I threw the book away. Any author who can't start a story within 100 pages is a shit author who needs a better editor.
Maybe I'll try again someday. I'll start halfway through the book and see if maybe the story starts by then.
WARNING, SPOILERS AHEAD
Halfway through the novel, the protagonist meets a hobo who used to be a worker at the Twentieth Century Motor Company, whose bankruptcy years before was a key event in the novel for several reasons. He tells what had actually happened there:
After the founder's death, the heirs decided to manage the company under the motto: "From each according to his ability, to each according to his needs." The consequence was obvious: all workers pretty much turned into beggars, inventing more needs, while anyone who demonstrated competence was required to work harder. While the press praised the "enlightened" management, productivity collapsed, quality went to shit, and clients ran away.
Circumcision is child abuse.
Yea, they were. I had deal w/ the Occupy smell on almost a daily basis in Oakland. The hammer and sickle was a very common sign then.