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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.
One thing that often is missing from discussions about raising minimum wage / minimum salary is what to do with those already making more than the new value. I (like most engineers) make more than minimum wage. I've seen minimum wage go up by 40% since I entered the work force, but my own salary has only gone up by 25% in that same period. Minimum wage goes up, but my buying power goes down.
They evidently don't like it, but it's pretty dumb to quit because someone else got a raise, esp. when it means the CEO is now making less than you. I suppose the story was supposed to be "CEO sacrifices pay so engineers can upgrade Escalades to Ferraris," which of course would have been very heart touching.
When things get complex, multiply by the complex conjugate.
You should not expect any kind of loyalty from your employees, so you have no obligation to have any for them. Use them, work them down, toss them, replace them.
They do the same with you.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
There is a saying in France that says:
"the heart is on the left, but the wallet is on the right."
While I partly agree with you, I would like to share my own experience.
20 years ago, I worked for a game company where the boss wanted full equality, so he paid everybody around the same salary.
While the approach is humanist, in the end it did more bad than good.
There was a huge trust between members, but beginners were terrible and were slowing down the experienced people.
I wholeheartedly loved working for this company, but it collapsed after finishing the first game.
The lessons are:
1) pay people as low as you can, but as much as they need to live a comfortable life (and won't want to quit your company). Everybody has different needs, and I don't count "home cinema" as a need !
2) pay well your better workers, don't count on their faithfulness especially if you fire people randomly
3) be frank. People (especially the awful workers) are obsessed why they don't earn as much as their colleagues. Tell them why they don't deserve a higher salary.
Don't leave out that the business is booming,...
How is this not modded up?
There was a time when the discussion on Slashdot had an element of genuine curiosity - when people were actually interested in fact and reason. Now, it seem to be mostly just people trying to push their own simplistic ideology - even against basic observation and logic.
There is an entire parable about this in the Bible, in Matthew 20.
The gist is: fuck you, you earn plenty, stop griping about others getting a slice of pie.
send this guy back for more brainwashing.
you're supposed to resent people beneath you getting anything at all, despise them for being worthless losers. poverty is not a circumstance that people find themselves in, it's a moral failing caused by their own failure as human beings. they deserve to be fucked over.
you're also supposed to envy people above you, their success proves that they are sublime beings of great moral worth who also deserve what they get. and if you worked harder and longer and stuck your nose ever further up your boss's arse you too might one day deserve it.
didn't you watch TV at all? or are you just immune to the non-stop re-education programming?
Are you saying there's something entitled about his running a business according to his values?
If it's a stereotypical corporation, falling under articles of incorporation with a board, et cetera...
Quite possibly, fuck yes, there's something hugely entitled about it. You do not get to just do whatever the fuck you please in such a situation.
Thus the reason a co-founder is suing him.
Imagine that.
Differences in pay exist for a reason: Because different people perform functions of different value to the company.
And some people feel they deserve more pay than others, regardless of whether that's actually true. Don't underestimate the power of "ego".
Why, actually, does it matter to one person what another gets paid? If *you* are getting paid a fair wage for your efforts and can live the life you want/need to live, why does anything else matter? It's not a contest of whoever has the most wins.
Personally, I make more than I need. I have deferred raises in favor of my teammates who need the extra money more. I have volunteered to take time off w/o pay, when the work load permits, to prevent teammates from being laid off. They have families and bills, my wife died in 2006 and I'm debt free. In the past 9.5 years, I've given about $100k to friends who were in trouble, through (almost) no fault of their own or who needed something extra to pursue bettering themselves. They didn't ask for help and were willing/trying to make it on their own -- I could help so I did.
I have also had a few comments about my behavior. A few years ago, when I volunteered to reduce my hours to reduce the impact of a budget shortfall on my teammates, because I could live on less money, one of my manager's managers remarked that I could keep working and give him the extra money I didn't need. I replied that would be happy to give him *all* my money, if he'd give me my wife back. (Haven't heard from him since.)
According to a NYT article, Dan Price bumped the salaries of his employees when he learned that many people were having trouble making ends meet on their salaries and decided to pay them a more livable salary. Some of his other employees got ticked off because of what they think people *deserve* to be paid.
Some CEOs make 100-300 times what their lowest-paid employee makes. Based on the CEOs you know or know about is that right? Perhaps we'd all be better off if people concerned themselves less on what they *can* earn and more on what they need to earn and about the benefit of their teammates and, if you're in management, the benefit of the company as a whole. Employees that feel valued -- really valued, not that "employees are our most valuable asset" bullshit -- and secure are often better employees as they have less to fear and worry about.
I will be writing Dan an actual snail-mail letter commending him on his actions and wishing him the best.
Remember Sue...
It must have been something you assimilated. . . .
What "moral values" would that be? Destroying a company that a lot of people worked hard to build, just in order to feed his own ego? Of course, if he owns the company, it's his right to destroy it. That doesn't make it a moral thing to do.
You mean like this? https://en.wikipedia.org/wiki/... With decades-long waiting lists for even getting one of those drafty, cramped, noisy apartments? Thanks, I'll take US-style capitalism over your "hard-nosed realism" any day.
I don't understand what he hoped to accomplish. I could see normalizing pay for each job so that all the secretaries got one amount, the entry level developers got another and the senior developers got another amount. Then you might change the distribution so that the difference between the secretary's pay and the CEO's is say 10-20 times instead of the 100 or more than we see in many big corporations. Any or all of those changes might have worked out but to put everyone regardless of their job on the same pay grade just doesn't make sense.
Its a mutation of the equal pay for equal work dream. Problem is, you simply do not get equal work out of people. You just don't.
I was one of two of the highest paid workers in my department. The reason was that we produced. We'd work extra as needed, and when the suits brought work to us, they knew it would be finished on time, and would be well done.
Not quite teh same with the others. Some would do meh work to meet the deadline, some just did enough to keep from getting fired. a rae few even less (which got them fired)
The problem with the concept of every person in Job A getting the same amount of money is simple. If my industrious coworker and I were to recieve the same pay as the person who barely produces, we would adjust our output accordingly - or more likely, since we were both self-driven, we'd go to another place, and they would eventually be left with the worst employees.
Its the old saying - if you want high quality hay, you have to be prepared to pay a good price. If you are content with hay that has already been through the horse - that comes cheaper.
This in no way addresses the weird world of CEO pay.
The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.
...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."
There is also extra pay for various specific skills. Some of them cut across job categories, for example you get more pay if you speak another language. Others are specific to the job; electronics techs get extra pay, medical personnel get extra pay, etc. People in high-skill jobs tend to get promoted faster and therefore be higher in rank than those in low skill jobs, which also boosts their pay.
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
Mediocre employees who mistakenly think they are great are upset that great employees who they think are mediocre are being paid the same.
$70K was also the minimum. What they complained about was that the person making a subsistence living at $20K to sweep the floors may have gotten a huge raise whereas someone make $100K got no raise at all. People can be petty that way.
Well with regard to point 2, I don't see why these guys just move to a lower cost area. Every time I mention it to them, they babble something like they have the "right" to live there. For reference, $1094 a month's rent gets me:
1) 1 bedroom, 1 bathroom, living room, big kitchen, total 781 square feet, single floor unit and located on the first floor.
2) Two very large swimming pools (one of them has a beach style entry and sand pits) spa, gas powered grills that are free to use, cabanas, outdoor TVs.
3) Gated community, with a unique gate code per unit, and a remote for the gate so no reason to stop and reach for the number pad when you drive in
4) Trash butler who comes to my front porch and picks up my trash
5) Keyless entry to the pools (uses an NFC fob)
6) Same day service when I something breaks (for example, I called to complain that my AC was too loud, and somebody fixed it a few hours later. Dishwasher wasn't working, fixed the next morning.)
7) Fiber internet (max tier is gig)
8) Total cost for electricity and gas ends up being another $110 a month during the summer. Since this is in Arizona, heating costs are minimal during the winter.
9) Fitness center, with free gym classes.
10) Nice mountain view, and lots of nice places to eat and shop are within walking distance.
And yes, the figure I quoted above includes all of the amenities and taxes. At the start of the month, that's the exact amount I pay.
Tell me how much something like that costs in San Francisco or New York.