Blizzard workers share salaries in revolt over wage disparities
bloomberg.com
bloomberg.com
Say you have 10 people sitting at a round table. Person 1 picks up a piece of paper and on it writes a sum of their salary + randInt(100_000, 10_000_000) remembering what the initial random number was. We can call this number the seed. They then pass the piece of paper to the right and person 2 reads the number, adds their salary and writes that number on a new piece of paper that they pass to person 3. Finally when person 10 hands the paper to person 1, person 1 subtracts the seed from the final number then divides that value by the number of people. That gives you the mean salary of the group.
I can't remember the exact phrasing but years ago my boss said at the team meeting something about not discussing salaries, and someone said later "I don't think you can say that" and he was like "oh, ok". The message was delivered though.
So, assuming you have evidence of the chain of events:
- Group shares salary openly - Employer says: "you cannot do that", someone responds: "You can't say that", employer: "oh, ok" - Group continues sharing salary - Employer shortly thereafter fires 2 members that had shared their salary citing other reasons ("You had 2 1-minute late attendance events within the last 2 weeks")
If I'm on that jury, if that's all the evidence presented, that gets me to a "preponderance of evidence" that the termination was wrongful. At that point, I would need to see some evidence from the employer that the attendance events leading to the firing was not pretextual.
And things are rarely black-and-white. If your boss thinks you're a douche, it will hurt your career. If your next performance review is a 7 instead of a 9, that might not lead to termination now, but it prevents career growth, and gets you sacked next layoff.
I don't think anyone would every get laid off JUST for sharing salary info, but it would push a lot of people over the edge.
All I'm saying is be careful about how you do it.
Don't know about the US, but in countries with strong (or existing) worker unions the unions would jump at that kind of case to help the employee with expenses, legal counsel, and what have you.
Unions definitely have their problems, but keeping the employers on their toes about actually breaking the law is one of their big benefits.
Of course all that doesn't help with all the other things you brought up, so there's that.
Getting fired for sharing salary information is not high up on my list of concerns, in part for that reason.
Eventually went from bad to worse. It was so stressful it caused a condition of mine to flair up. Long story short, I was vomiting blood and stomach acid on the daily in the mornings. Work from home would have accommodated me but they refused because the CEO was an asshole. He let others work from home as a "favor", but wouldn't meet medical needs.
After giving me more than one death threat, I finally quit and sued. Pro bono, of course, since I had no money.
They hired the most expensive defense firm in California to take the case over what would have been a $5-$10k settlement. My lawyer was unbelievably startled by this, and immediately dropped the case after.
Threatening to kill you is probably another claim beyond failing to reasonably accommodate your medical condition. It may also be a criminal threat that a prosecutor would be interested in. I would think that would strengthen your case.
> Pro bono, of course, since I had no money.
> ... My lawyer was unbelievably startled by this, and immediately dropped the case after.
Depending on what type of pro bono attorney you had, that may have been reasonable. For free legal aid type attorneys, litigation is out of the scope of what they can help with.
What you probably wanted was a lawyer who would take the case on a contingent fee basis. That means that they don't get paid anything unless you win, but if you do win they take 30-40%. Many plaintiff-side personal injury and employment lawyers like to work contingency because if they're good at it they can make way more money than an attorney working for an hourly rate. It's often a good deal for the plaintiffs too because they may get 60-70% of a much larger settlement amount.
It sounds like you got some bad advice.
Litigating against a company like the one he described would cost more than he would make even if he was paid on 100% contingency fee.
We don't know the actual value of the case. The defendants seemed to think that it was worth hiring "the most expensive defense firm in California".
We shouldn't assume that the estimate was accurate either, for a couple of reasons:
First, the defendant definitely has more information (e.g., manager's employment records). More information usually leads to a more accurate valuation. And the defendant seems to have valued the case higher because it hired the expensive defense attorney.
Second, Gamemaster's attorney dropped the case, probably because they lacked the required experience with these types of employment cases. If they lacked the required experience to handle the case, then they probably weren't qualified to give an accurate valuation either.
1. Defendant had more information
2. The extra information was so important it would increase the value of the case 50x (there are not very many pieces of information in an employment suit that would increase a payout by 50x that an employee wouldn't know about)
3. They hired a very expensive attorney because of this reason.(as opposed to for intimidation reasons)
4. Gamemasters attorney was inexperienced.
5. Gamemaster's attorney's lack of experience caused him to drop the case.
6. Gamemaster's attorney's lack of experience also led him not be able to give an accurate valuation.
If the employer is legally aggressive or the employee is looking for a fight they would never take a case like that.
Maybe. Depends on the state, the complaint, and the lawyer. Several states allow/force the loser to pay legal fees, to allow small-fry folks with legit complaints to fight against larger orgs with money to spend.
Lawyers may also take cases on contingency, or you may be able to find legal aid / pro-bono / reduced rates.
There are also lots of levers available via state or provincial labor boards. These will vary greatly, and may not replace a lawyer or lawsuit -- but some will.
> Law suits burn bridges (you'll never get a recommendation from an employer you've sued).
They already fired you for reasons that are "wrongful" -- the bridges are already burned. Were they going to give you a good recommendation before the lawsuit? Probably not. Maybe they didn't, and that's why there are lawyers involved.
> Law suits prevent future jobs (would you hire someone who sued a previous employer?). And wrongful termination isn't the end.
Depends on the role and hiring pool.
For roles that are harder to fill, or situations where I'm willing to take a good hard look at the candidate then maybe. Like, these are public records, and if I'm on the fence I could always just get a copy of those records. Plus there is plenty of shitty behavior on the part of employers -- no shortage of stories about it here on HN -- so I'm willing to give a qualified candidate the benefit of the doubt.
Totally agree with your point if this is for a role where I get 500-1000+ resumes -- plenty of talent out there, so why settle for someone who picked a fight?
I don't know how many employers check that sort of thing, but I know that if you sue your landlord in NYC, no matter how justified, once it shows up in public records nobody will rent to you. I know this because I ran across court documents where the court matter-of-factly acknowledged it.
This sort of thing is why I think frivolous lawsuits are greatly exaggerated.
I'm positive the company would have evidence that the terminated individuals were late by 1 minute on two separate occasions. But the company might also have evidence that other employees were also late and not terminated.
You can pretty easily create an evidentiary trail that "Person X did thing Y, and was then terminated". What's harder is creating an evidentiary trail that "Other people at the company are also regularly terminated for thing Y".
If the company really does fire every employee that has two 1-minute tardiness', then it's going to be a real struggle to claim the firing was pretextual. If this firing is the first time the company has fired someone for those reasons, the company is in real trouble.
Instead, when someone wants to get rid of an employee for a reason that might not be legitimate, they write them up for about a dozen vague and contradictory things, and then present it as a "sign or be fired on the spot" thing, whereupon the employee signs, either because they convince themselves they can salvage the situation, or they just need more time to job hunt.
Then after a little while, they do it again, so it fits into the normal framework of someone being put on a PIP and failing to improve.
When they quit or are fired, it's essentially impossible to challenge, because it wasn't just one or two tiny things, it was a whole list of BS, and the employee signed their name to it to buy time. Or at least it's intimidating enough I think few people would consider suing.
You know what those top earners are going to do then? Quit. And then you end up with overpaid mediocre talent and a product roadmap that is suffering from the loss of top performers.
The more we celebrate victimhood as some kind of hero status, the more we shame and punish those who achieve and create success the worse off we're all going to be. A private company has every right to compensate its employees with its private capital anyway it wants, and they're going to want to do it in a way that achieves the goals of the business. They're not distributing welfare checks, they're a business.
It may well be, if not more likely to be, the other way round - you could be a GOOD performer, but since you can't or don't gork office politics, you are underpaid or even not at the level of challenge and seniority you should be.
These are merits. They mean you're easy to work with, people want to work with you, you know how to make and maintain important relationships. You'd make a good leader. You can recruit talented people. You can get preferential treatment from vendors. Your projects get noticed.
If you can't play this game, it doesn't matter if your technical skills are better. You won't have a chance to put them into practice. You won't have allies. No one will want to work with you or listen to your opinions.
Perception = you are good at communicating your work to others
Connections = you have a strong network and stay informed and know who to talk to for different tasks
Face time = you are easy to get along with
Ability to handle office issues = you are a lubricant that make the group dynamic work
If you don't do those things, then you could write fantastic code, but: no one will know about it, know to ask you about it, be aware you're doing it, and find you somewhat of a drag on the office atmosphere. Basically, your work is not useful to the company that is paying you, and you should be paid less because of this.
But it is also perfectly possible to achieve good perception, strong connections, lots of face time, and ability to handle office issues, while also being really bad at your actual job, and without any of the positives you mention (except for the fairly bland "easy to get along with").
The real problem, of course, is that what office politics optimize for is extraversion over performance, so anyone who's introverted (which a disproportionate number of programmers still are) is going to come in at a disadvantage.
And, um...if you're writing the code that's required of you, by the people who require it, and you're writing it well and in a timely fashion, it doesn't matter if you brag about it to everyone around, it's plenty useful to the company. I don't know where you've worked where the primary work you've done has been code that you've come up with on your own, which you've then had to "sell" to your own bosses and coworkers, but that's definitely not the norm.
Second of all, you seem to be looking at things in very black and white terms. Of course you need to be able to communicate project requirements and dependencies and whatnot, both within and between teams. That's nowhere near the same thing as "networking" or "making connections" in the commonly-understood sense, which is much more about going over to have a chat and a laugh with Steve or Patty down the hall...or, to take it a step further, going out for a game of golf and running into the CTO there, and just happening to have a chat about your upcoming review.
So, in short: yes, of course "being good at your job" requires communication and people skills, as well as (in our case) coding skills. But there are many places where the skills required to advance—both financially and in your career—are exclusively the people skills, regardless of the fact that the skills that are primarily relevant to job performance are the coding skills. This creates perverse incentives, results in unqualified people getting managerial positions, and massively disadvantages those who genuinely care more about doing a good job than "selling themselves"—especially introverted people—in the workplace.
This is not about spending time chatting up people all around the office and networking. It's about responding clearly when people ask you questions, when you have your 1:1 with your manager, and in how you write your emails, etc.
And saying that if no one knows about you you should be paid less is so false. Because, everyone will know about you when you leave and things stop working. Im not talking about single point of failure. But say all non communicating developers are gone from software company one day, id say company would feel that.
You can blame office politics, you can blame your lack connections, or whatever hand you were dealt. It probably wasn't a fair hand, but it's on you to make the best that you can out of it.
I don't cry about unfairness. I look at what I want, and I figure out how to get it.
It would seem that most employers would rather bear the cost of replacing someone than increasing their compensation to align with the value provided.
These things are all extremely important pieces of keeping a company functioning well. To the extent that if you're good at these things and mediocre at whatever your main job is you are probably more valuable to the company (as in very literally adding more value) than someone who excels at their main job but can't cope with working in an office. If it's true that people who are good at those things are being rewarded more than people who aren't then we are actually doing pretty at basing pay on merit.
Office politics are, obviously, something you need to be good at to achieve seniority in an office.
I’ve been with my company for nearly 2 decades and only know about 10 people, and only 2 of those well. I worked with one person for five years on a daily basis before they learned I was married with a bunch of kids.
My salary has gone up 84% in those 18+ years. I make way more money than I feel I deserve (though I’m not complaining). I’ve never asked for a raise or anything like that. They just keep giving me raises on their own. Just recently in the middle of the pandemic they gave me a 16% raise out of the blue.
I don’t know for sure how much others make, but I’m fairly certain I’m one of the top earners. It frankly baffles me.
My salary went up 300% during the first three years of my career... but it mostly meant that I had no idea about the market when I was freshly out of university, and my employer was happy to take the advantage of my ignorance. (As I later found out, the increased salary was still way below the market rate.)
I am not contradicting your judgment, just saying that increased salary may also have another interpretation. And how much you feel you deserve, that also depends on your background, etc. For example, it felt quite weird to me when I was making more money than both my parents together; and yet, it was below the market rate for my type of job.
84% raise doesn't sound like much if you've also increased in seniority in that duration.
Entirely possible the Parent comment was getting paid 6 figures years ago and is now up to 200-300k total comp... but that's still paltry compared to SV, NYC, or cleared Washington DC work.
If the CTO sits no more than 2 cubicles away from every engineer he better know who the top performers are. If employees are playing politics at a small company, that company is already doomed.
Hehe.
This is a false dichotomy. I see this kind of language frequently in discussions. In my experience, it does not tend to invite more thinking. On the contrary, it tends to polarize and discourage discussion of other options.
So, please, let's move away from overly simplistic arguments. So instead of false dichotomy, let's explore a range of options.
Consider this proposal: First, reduce the CEO's compensation (call it C) by multiplying by X (where 0 < X < 1). Second, use what is left, C(1-X), to increase compensation of the other employees. For various allocations [1], what are the possible outcomes?
One would hope [2] that companies operating in a relatively free and somewhat capitalist system like the US would directly or indirectly explore the values of X in order to find better and worse results.
As for me, I would bet there are values of X that lead to better outcomes for both the company and the satisfaction of its employees.
I would be interested in models and studies that examine this question. Would anyone like to share some they have read?
[1] Some (e.g. libertarians) might call this a "redistribution" and look at it with a negative light. I suggest calling it an "allocation" because I think of it as an optimization problem. The goal is not to maximize CEO pay. The goal is to maximize company success and overall employee satisfaction. (We might define success as (i) profit or (ii) or accomplishing some mission.)
[2] I say "hope" but I do not expect it. There are many market failures and organizational factors that may get in the way.
Maybe one of the biggest myths is that we can appraise performance objectively and that pay is nothing but a function of that performance.
In reality, this is nothing but price discrimination for the price of labor; just like it would be in an airline's best interest to squeeze the most individual dollar amounts out of every individual passenger for the same flight, it is in employer's best interest to pay the absolute minimum that can convince each particular employee to do the same work.
Information symmetry or collective bargaining destroys that advantage.
What Blizzard workers did might feel like a revolt in the US, but there are countries where total income and taxation information of each individual must be publicly listed annually.
This doesn't matter at all, information asymmetry based extraction is still there.
The employer is buying labor in large quantities from many sellers, and because they don't appraise all units of labor individually (they can't), they are individually negotiating the least amount of money they can get away with. The fact that prices are concealed between these individual sellers (candidates/employers) is the only way this can work (information asymmetry).
When a buyer is shopping for a airplane ticket, they are shopping for the relatively same service from many providers, but they know these different prices and choose the cheapest (no information asymmetry). When, however, the airlines are using personalized pricing and the buyer doesn't know this (information asymmetry), the buyer is screwed over because they pay the maximum they would for the same flight, while the next guy is potentially getting a steep discount.
In both cases, if the information asymmetry is cured (as in sharing your salary or what money you paid for a ticket), the strategy no longer works because this changes the individual price points (people have huge loss aversion bias and they definitely react to the idea of being screwed over). The fact that they are buyers vs sellers in these transactions doesn't matter at all.
"Shopping for the best offer" depends on knowing what offers were available to you and the others to begin with.
This would work if all sellers were selling the same goods. Such as in case of hourly labor. Incidentally, in these cases, the salary is known and is same for the laborers with the same skill set and responsibilities.
In case of salaried jobs, such as in Blizzard, the labor of each employee is unique and you cannot sensibly price it wholesale thus there are salary negotiations for both sides to come to an agreement. I personally do not see how knowing other people salaries is going to help you in a negotiation as this does not give you any additional leverage but if you think it will - go ahead and disclose your salary to your coworkers, see how it will go.
>"Shopping for the best offer" depends on knowing what offers were available to you and the others to begin with.
And who is preventing you from asking? I don't see how asking your coworker salary is going to help you to learn what offer you can get in another place without applying there.
Yes, that is exactly what I am claiming to be a myth. That unique price point is not a result of appraising the worth of that unique labor. Anyone involved from interviewing to making the hiring offer so don’t give a crap about finding your unique value, let alone your expected value, nor they have the means necessarily. Which means price points are mainly a result of negotiation power of the each party, which is severely handicapped for the candidates, because they don’t know the offers made to others in comparable experience and education. So they don’t know the best counter offer they could make and still get hired. That unexploited margin goes to the employer which has tons of data on past rejections and acceptances so that they can better minimize the offer they make.
In some labor markets, the non-negotiable salary is advertised with the job ads. Not claiming that is an infallible solution, but it makes for a drastically different labor market.
>which is severely handicapped for the candidates, because they don’t know the offers made to others in comparable experience and education
It does not matter. If you are not satisfied with the offer - ask for more or walk away. If you are - then it does not matter what others got especially to you, who have not evaluated them at all. What you think is "comparable" might be far from that in my view and vice versa.
>In some labor markets, the non-negotiable salary is advertised with the job ads. Not claiming that is an infallible solution, but it makes for a drastically different labor market.
Yeah, I gave an example in the post you replied to: the unskilled labor market. Amazon pays the same rate to every warehouse drone and it's known in advance. Same as many retail jobs, same as many trades.
There is no magical essence to markets that justifies any agreed pricing point as the best price that ever could be. Especially under information asymmetry markets don't operate well i.e. they don't set prices as efficiently.
> It does not matter. If you are not satisfied with the offer - ask for more or walk away.
Sounds like it does matter in your argument because here you are constructing a satisfaction criteria that hinges on not knowing the other offers.
If knowing other offers changes your satisfaction level, was it really an objectively satisfying offer in the first place?
> Yeah, I gave an example in the post you replied to: the unskilled labor market
I was thinking more of labor markets in some European countries, which are not at all exclusive to unskilled positions, e.g even includes managerial positions. I think there might be some sort of confirmation bias here preventing the acceptance of the possibility that some labor markets do have transparent compensation for even highly skilled positions and they work OK.
True. Has anybody claimed the opposite? The only thing market ensures is that both sides agree with transaction. Which is the best you can get.
>Sounds like it does matter in your argument because here you are constructing a satisfaction criteria that hinges on not knowing the other offers.
I do not do such thing. Even more, I specifically ask why would it matter if you knew about other offers? If you are okay to work for 30K then why you are suddenly not okay if you learn that somebody else gets paid 50K at the same company? This makes no sense to me. Even considering opposite, you know in advance that other people got 50K for the similar position and you are offered 30K, what would be different? It's not like you are going to get 50K just because of your knowledge of other salaries. And you can always ask for 50K with or without such knowledge.
>I was thinking more of labor markets in some European countries
I get spammed with a lot of European jobs on LinkedIn (I have no idea why they would shop for programmers in the US to be honest), none of them have fixed salaries. UK,Netherlands, France, Norway,Sweden,Finland even Iceland - they have a wide range at best, most are "DOE".
I think you've just claimed it again?
> I specifically ask why would it matter if you knew about other offers? If you are okay to work for 30K then why you are suddenly not okay if you learn that somebody else gets paid 50K at the same company?
If you learned you were paid %30 less than everyone else at your level, wouldn't you go for a renegotiation with your manager or go back to the labor market? Would you internalize that difference as "I guess the company knows my worth exactly and I deserve it"? If you knew the average price for your level as a candidate, wouldn't you use that knowledge in your next negotiations? I mean, I thought this was common sense, self-explanatory game theory. You are claiming the knowledge of the competing price points to have zero value in price setting, and it is a strong claim that requires matching evidence.
> I get spammed with a lot of European jobs on LinkedIn (I have no idea why they would shop for programmers in the US to be honest), none of them have fixed salaries
Your personal sample is hardly representative because we are trying to establish existence of transparently priced positions that are not low-skilled. From the top of my head, if you have access to paper version of 'The Economist', you will see plenty of such ads. Granted, this might be my availability bias, but definitely there is no hard rule of concealed pricing for highly skilled jobs.
I see. Not even trying to make an argument because you disrespect the conversation or because you are out of arguments? Either way it does not seem to be going anywhere.
>If you learned you were paid %30 less than everyone else at your level, wouldn't you go for a renegotiation with your manager or go back to the labor market?
I don't have "a level", my job is unique as well as other people in my org. Hence I get a salary and not a hourly rate because I do not produce a well measured labor at constant rate. But if I decide that my negotiated salary is not to my satisfaction anymore it's not going to be because I learned other people salary but because I feel that my value has increased. As I said above: your reasoning only applies to hourly laborers whose labor is already openly priced at "levels" and there is not much room for negotiation.
> You are claiming the knowledge of the competing price points to have zero value in price setting, and it is a strong claim that requires matching evidence.
Nope, you proposed that there is some strong relation between one's negotiated salary and other people's salary without any evidence and when I asked how this is supposed to work you claimed I made a strong claim. You are not even trying to defend your argument, are you?
>Your personal sample is hardly representative because we are trying to establish existence of transparently priced positions that are not low-skilled
I see where confusion is coming from: you think that positions that require some skills are not low-skilled. I used low-skilled in the sense that US DOL uses to distinguish between salaried and hourly workers.
This is a common kind of one-sided argument. For the sake of argument [1], let's say I grant than an organization has the rights and freedoms like you say. There is another side to it: employees have rights and freedoms too. In a democracy, people can and should use their influence and political power to address their concerns.
[1]: Employers do not have "every right" to compensate employees "anyway it wants". As one example, see the Equal Pay Act: https://www.eeoc.gov/equal-paycompensation-discrimination .
What is motivating this interpretation? Do you interpret something in the original article as suggesting this?
What about the article (which contrasts multi-million dollar executive pay against minimum-wage workers) suggests to you that someone is "celebrating victimhood"? If so, who is this someone?
> ... the more we shame and punish those who achieve and create success the worse off we're all going to be.
Can you unpack your assumptions and logic in coming to this conclusion?
I like that you said "top earners" as if it implies that "top earner" equals talent. It's far more likely that there is underpaid talent in the company that is about to leave for a better job. This is what employers are scared of. They want to underpay people that deserve more and you're just playing right into that trap as if it somehow benefits you. What if you aren't actually a top earner? How do you know that there is no "overpaid mediocre talent" already in the company?
>A private company has every right to compensate its employees with its private capital anyway it wants, and they're going to want to do it in a way that achieves the goals of the business. They're not distributing welfare checks, they're a business.
As I said. Salary transparency does not change anything about that. The welfare argument can be made by both sides. Employees shouldn't distribute welfare checks to their company either, they're not volunteers.
No, a business will spend money in a way that optimizes the goals of the various middle-managers in between those with money and those who make the decisions with that money. Those middle-people aren't paper-clip optimizers and so their decision making does not approximate that of a profit-maximizing firm.
Maybe, maybe not.
The opposite could be true: employees might more likely to quit a company that generally pays other employees poorly. There are lots of reasons why this might be the case.
Here is one type of scenario where that may be true. Many people recognize that company performance is not a simple linear combination of individual employee performance metrics. Having a well-functioning team is a substantial component of overall company success. With this in mind, it makes sense to work for a company that recognizes value more broadly, and understands that even "top" individual performers exist in a context of "non-top" individual performers. Therefore, if those "top" performers think it through, they will want the "non-top" people to be paid fairly.
For me, finding out that my more skilled colleagues make more money than me would be encouraging. It would mean that if I learn more, I could possibly get a raise.
The bad news is to find out that the people whom I admire because of their god-like skills actually make the same money as I do. That means that I have most likely already hit the financial ceiling.
To elaborate on my comment: I'm suggesting that an employee's full value to the organization should be reflected in their pay. For example, someone with slightly less than average skill in some area (e.g. as indicated by project performance up to this point) may have other strengths.
I recommend that you disabuse yourself of such a comparison.
Arthur Clarke is famous for saying "Any sufficiently advanced technology is indistinguishable from magic." As you build your knowledge and skills over time, you may find that others are just as impressed by you as you were by this other person.
I think this discussion is by and large irrelevant to any so called "top earner". If a person is highly paid and then considers any subsequent conversation about pay in a "cost-benefit" mindset they are pretty much not going to be a useful voice for equality.
I'm not condemning them mind you. To say one view or the other is better is a question of personal conviction. But if they're regarding their superior pay as strictly a matter of their personal benefit then I find it very unlikely any ethical argument would sway them to act in their coworkers benefit.
And we all are top earners, right? Statistics tell me most of us aren't. The consequence of sharing salaries is not equity but people being able to negotiate better so most likely average salaries will go up. CEO salaries have been public for a while now and I haven't seen them going down so top earners shouldn't worry. Instead they can negotiate better too.
The people that already negotiate have no incentive to share salaries
The people that can’t negotiate won’t be able to just ask for a higher number
That's exactly what your boss wants you to believe. What if you somehow, without sharing yourself, found out that you actually were nowhere near a top earner? Would that affect your conclusions?
Public servants have a progression table, so by knowing their level, you know the salary.
Companies either have an union agreement, so it goes back to the same level agreements, or they have internal evaluation with salary matrix, so again by knowing department and skill level, it is relatively easy to get the salary value, minus possible bonus.
They are even part of some job offer descriptions.
So at the end of the day it is hard to grasp why it is so sacred to discuss it on US.
I've seen it a few times, people with 30+ years of experience being paid massively more than newcomers, and just waiting for retirement. There's absolutely no point to do more than the bare minimum not to be fired in this situation (and if it's a government job, then it's pretty much impossible depending on the place), and it absolutely shows.
I also have many seen people waiting for retirement on the private sector.
In the case I know (nurses), it's about a nurse taking care of twice as many patients, and usually better. Not trying to change things, just doing their job.
What I can tell you is that those people doing more either quit or just give up and stop caring.
For what is worth my experience is mainly with the private sector. It's just that usually they are a bit more willing to sack people.
Roll a die and multiply (salary - 100k) by the spots on the die. Share that value publicly. Sum all such values and average them then divide by 21/6 and add 100k. Choose the 100k value to be closest to but not greater then your guess at the lowest salary.
Allow breaking down the salary into a sum of numbers, and putting them as separate slips into the hat.
Comparing confidential numbers is an important question in cryptography.
[0] https://en.wikipedia.org/wiki/Yao%27s_Millionaires%27_proble...
[1] https://en.wikipedia.org/wiki/Socialist_millionaire_problem
For example, if person 3 and person 5 collaborate, they can find out the salary of person 4.
i.e. If the minimum rand # is known to be 100,000, and person 2 receives the number 150,000 and knows it includes the salary of person 1...they will know person 1 makes <= 50k
Actually, I should have realized, what one should do is draw a random Gaussian (or Laplace) with very large variance -- see "differential privacy".
The solution can be to include negative numbers in the RNG range, or keep the RNG range a secret (except to person 1).
Anyways, isn't it possible to add and divide encrypted numbers? Couldn't we just do some variation of this?
The best part was, and they would emphasize this at every meeting, "that the company would pay the taxes for us" as if it were a big deal. People never believe me when I tell them this is how the non-devs got treated.
There used to be whole towns where you'd get entirely paid in, and shop with, corporate funny money
https://www.atlasobscura.com/places/rush-ghost-town https://encyclopediaofarkansas.net/media/morning-star-zinc-m...
Basically, say Blizzard compensates you $20k in Blizzard bucks, and you auction off $20k worth of items at a reduced rate, you end up taking $20k * discount rate from Blizzard’s revenue, roughly speaking.
You cannot do that, ToS forbids that, and if you were caught i expect that consequences would be harsher than just a ban.
Seems not too many tech people like history: if they did we would not be looping Greenspuns 10th rule derivatives on everything ; nosql, microservices, js, query languages, etc.
Nosql usually ends up as a really bad version of a rdbms with a query language that is a very botched version of sql. And then we move to postgres as it is actually better in every way.
Javascript was literally (the author wanted to implement scheme but that did not look like Java) a really badly done version of Scheme which had to look like Java. So this is directly Greenspuns 10th rule.
And we can go on: all these things have solid and scientifically sound implementations and yet we reinvent the wheel, badly and then usually drop it or try to reverse the damage by actually thinking about history for a second (wasm).
However, door dash does not follow this simple model. What happens is that door dash calculates how much an order is worth, if the customer tips then it deducts the tip from the order. If your order is worth $10 and the customer tips $5 the tip will always be deducted entirely. You get paid $5 for the order and $5 for the tip. Even if you somehow manage to complete 400 orders and all of them are tipped $5 you won't get a single cent from tips even though the tips alone are enough to pay minimum wage + some. The only scenario in which you can earn money from a tip is if the tip exceeds the order's value. Someone tips $50 on a $10 order. You get $0 for the order and $50 for the tip.
When you consider that in the restaurant arrangement it's actually intended for waiters to be primarily paid by tips (at least that's how I heard it works in the US??) they'll likely exceed minimum wage and only get the minimum wage during bad months.
With door dash you're the one who's being paid for every order you complete, not the cook + rest of the restaurant. Therefore getting a tip at all actually requires a heroic effort because people are not going to tip more than the order is worth. The tips might as well not exist at all and are a pure cash grab.
The reason I'm bringing up Door Dash is that it's an example of a truly evil company vs restaurants where it's just a very unusual but fair payment arrangement.
[0] - https://www.nytimes.com/2019/07/24/nyregion/doordash-tip-pol...
I shouldn't have said "always".
But it's not, because tippers can push you past minimum wage.
The most extreme example is in a state like Alabama where the minimum wage is $7.25 and the minimum tipped wage is $2.13 (these are the federal minimums):
+------------+----------+----------+
|Tips |Wage |Final |
| | |Wage |
+------------+----------+----------+
|0 |7.25 |7.25 |
+------------+----------+----------+
|<5.12 |7.25-$tips|7.25 |
| | | |
+------------+----------+----------+
|>=5.12 |2.13 |2.13+$tips|
| | | |
+------------+----------+----------+
True story. My ex-wifes grandmother was the daughter of a sharecropper who grew tobacco. Start of WWI a friend wrote her dad that if he came to California his friend could get him a job. Well her old man sold everything, bought a broken down car, and drove the family to Santa Clara. When they got to California she remembers her absolute joy when she asked her mother where the tobacco fields were and her mother told her they don't grow tobacco in California.
Oh, and Hearthstone packs
[edit: forgot Hearthstone]
[1] https://www.metacritic.com/game/pc/warcraft-iii-reforged
I don't know if it was Activision's influence, many of the original devs moving on, or World of Warcraft coming out, but since then everything about the company seems to have changed. So much of what they do nowadays just seem like money grabs. They release pay to win content meant to be addictive, dumbed down their art style to looking like cartoons that appeal to the least common denominator, follow trends instead of doing anything innovating, and seem to have completely stopped caring about making any interesting story. The villains in Diablo 3 were comically badly written.
At some point they even tried to force users to use their REAL WORLD names on battle.net[1].
It really isn't the same company as it used to be in the early 2000's.
[1]https://www.gamesindustry.biz/articles/blizzard-requires-rea...
[1] https://web.archive.org/web/20080702062733/http://www.netwar...
The concept that if anything about x pisses you off, just be done with it entirely would be great in theory if a large portion of the market felt the same way but in the end it's vidja games and a lot of people are sucked in and don't want to give up something fun for some high minded ideal that doesn't really impact them
Not really. The last good game that Blizzard made was StarCraft 2, 10 years ago. It's free anyways, so you can cost the company a few cents in server charges without supporting them. I don't play console games, so Activision is completely irrelevant to me.
> The concept that if anything about x pisses you off
I was talking about Blizzard specifically, not x. Ditching Blizzard will save you years of disappointment and frustration. It's quicker & easier to forget them for moral reasons than to be gradually disillusioned by their releases.
If you can avoid the COD and “Blizzard games are always the best” hype trains, there’s a lot out there to play, and a lot of games which respect your pocketbook.
Boycotts work. I enjoy playing competitive FPS shooters occasionally, and I’ve personally been able to stay away from COD since the private server debacle with no issues. To claim that their games are so good no boycott will ever work (so why bother) is conceding defeat before you’ve even tried.
I'm almost certain my pay is different from my colleagues, but I've bargained like hell to get it. When I was hired, every time we've been acquired. I'm no executive either, I'm just a developer with a proven history of give-a-damn.
I think it's perfectly fair game in a job where it's hard to replace individuals, jobs where people with the same title can achieve vastly different amounts of value for the company, and especially for a company that values its employees.
Whether or not pay discrepancies can be fair, this doesn't sound like a case of them being fair. What happens to your (hypothetical) colleague who gives just as much of a damn as you do, but doesn't feel comfortable hitting the appropriate negotiation notes to get their due?
Similarly: given that companies are liable to offer a lower initial rate to women and minorities, how do we account for the fact that they might negotiate just as hard as you and still end up behind?
If you are not willing to fight for your corner, that is an issue with you. You can't expect the world to come to your rescue.
This is just as true in relationships as in business. What happens when your partner dumps 100 tasks on you and doesn't realise they're being a dick? Will you stand up for yourself? Or there's just some simple situation where the other person doesn't see your perspective?
Life is full of situations where you either stand up for yourself, and communicate, or someone runs you over by standing up for themselves. And they might not do it with bad intentions, it's just that everyone has different interests.
If you aren't assertive, you need to learn to be, or accept that you will be treated unfairly. There are obviously nuances to this entire point, you might be able to outsource your assertiveness to others, like a friend to help you, or a union at work or whatever, but unfortunately there will always be situations in life where you need to stand up for yourself, and if you don't, that's 100% your fault and responsibility, no one elses.
I welcome you to quote where I propose these things. We’re talking about whether or not one might still be paid unfairly despite asserting their boundaries and negotiating with effort.
It’s arrogant of us to assume that someone who gets the short end of a position (relative to their peers) wasn’t assertive or simply fought less. We just don’t know that, and assuming it in the presence of reasonable barriers (like homelessness, or just plain being offered less as a starting point) is myopic and cruel of us.
By contrast I agree with your second example as systemic discrimination is something sharing salaries can directly help with. I had a female co-worker who was the same level of engineer I was at our company, had more experience and a Master's degree (to my Bachelor's), and was making 10k less a year than I was. Now I'm not sure if that was due to her being a woman or being rather conflict-avoidant (or both), but seeing the difference certainly made her push for a promotion that she eventually got.
One potential reason: being aggressive and strategic, as qualities, are orthogonal to one's skills. They're just as good signals for being an abusive manager or manipulator as they are for "giving a damn."
We've also gone and conflated "aggressive during salary negotiations" with "(positively) aggressive in one's job." It's not clear to me that these are the same things, particularly in the context of economic need and privation: I'm more likely to be aggressive and confident in my job once I know that I can afford groceries and rent. The "I" there is me, personally.
In sum: the qualities that make someone a good negotiator in the context of obtaining a job are not necessarily positive qualities within the context of the job itself. Conflating the two eliminates an entire cohort of qualified people who may possess those traits but lack the systemic comfort to risk demonstrating them.
1. Accept the offer
2. Walk away
3. Say "How about more compensation?"
If you do 3, the company will either say:
3a) (95% of the time) "How about no?"
or
3b) "How about this small amount more?"
And from there you can accept or walk away and that's pretty much it. You can write the decision tree on a post-it note. What are people talking about when they say "aggressive and strategic"? Bang on the table more? Yell and scream? What are you captains of industry doing that the rest of us aren't? In my view, we are just workers--our only leverage is our willingness to walk away, which is usually fine with the company. They have a long line of candidates out the door.
Over the course of a career this behavior compounds into superior experience, superior interview performance (you have more examples to draw on/confidence in general), and secure enough position such that you have the ability to walk away.
For example, your perspective of "they have a long line of candidates if you try to negotiate". That may be true but your name arrived at the top of the list somehow. The fact that you're getting an offer alone gives you some leverage, and small increases in salary can matter over time. There's always a range of salaries for a given position, why not convince them you deserve the top of that range? Maybe it's through actual experience, maybe it's just by reading their personalities and being likeable in the interview, but at least try the hand you're dealt.
Granted this isn't always possible given an individual situation, but so many people simply throw away what leverage they have out of anxiety.
You have more leverage than that; not all workers are equal. That's why interviews exist in the first place. Maybe you have prior industry experience, or experience with some paradigm/framework they want to adopt. Feeling like that probably hinders you in negotiations; if you're arguing that workers are largely interchangeable, it begs the question why they would hire anyone other than the cheapest possible person.
On your decision tree, you're missing a step where you explain why you're asking for more pay. The most compelling argument there is frequently a competing offer from another company for more money (which is evidence that what they consider "market value" for you is too low). Other than that, you can argue that they're misjudging your value to their company. Your industry experience should add value, or your ability to be a leader among ICs, etc. You'll have to justify why you should be paid more.
You've also entirely left out negotiating. If you're not happy with response 3a or 3b, propose an alternative. There are several compensation alternatives to salary.
In terms of pure cash, you can ask for a sign on bonus. Those are typically paid out of a different pool than salaries, and can be easier to negotiate than a salary increase. It's also CAPEX instead of OPEX, which I believe is preferable to a business (just based on what companies have told me, I don't know the entire reason why other than that it's a 1 time cost). If you have an idea of how long you'll be at the company, you can amortize the sign on bonus as part of your salary.
There's also a large array of non-cash compensations you can get. You can negotiate to work from home X days a week. You can negotiate for more vacation days per year. You can negotiate reduced hours for what they're paying. You can negotiate to have them send you to conferences, or to more than the standard number of conferences. You could probably have them give you hardware that's being decommissioned if that's your thing. Another atypical idea would be to have them pay for/subsidize/use their discount on an AWS/GCP homelab for you (that seems less likely to be possible because of issues with accounting, but can't hurt to ask). The limit is only your imagination.
I think aggressive is a misnomer here. I would call it assertive. You don't have to bang your fists, just know what you're worth to the company and maintain that you won't accept a lower value. If they say they'll pay X, you respond that it's below what you would expect for someone with your skills/experience/whatever and that the offer would be more compelling if it was $Y higher. What many people do is the opposite; they wait for the company to decide what they're worth and then they decide whether that valuation is acceptable to them.
If you've just been laid off or are fresh out of college and "need" a job, then maybe being aggressive isn't worth the risk. But once you have an established career being positively aggressive on the job largely determines the opportunities that present themselves and the will/ability to exploit said opportunities. This in turn compounds into more favorable experience and a more secure position when applying for the next job. It's basically what the buzzword "leadership" is supposed to mean and why it's a buzzword in the first place.
To your point, filtering for those traits does filter out a large cohort that may be qualified for the job, but a company is more than just the job they offer. Do you want a worker who does his 40 and goes home every week, or someone who might bring extra dynamism and productivity to the company on top of his 40, and is only asking for 5-10% more?
How is that relevant to the person’s compensation for their work? Yes, negotiation might be a useful skill in other areas of life, but you might as well advocate paying people more for other useful skills that are irrelevant to their effectiveness at work, like changing a tire or home cooking.
Because being "aggressive" and "strategic" are not the only two qualities useful to providing value to an employer. Hell, depending on your role, being aggressive can be a negative.
Wonder if a different colleague making 10k less had shared salary if she would still have pushed for the promotion ?
Is there a lesson here?
Keeping individual wages a secret ultimately benefits the employer as they can use the knowledge disparity to their advantage.
I even know of arguments that a new father doesn't need to receive a relevant raise as he is extremely unlikely to switch jobs due to the newborn.
Employers, even most of the ones claiming to be fair, will do everything to keep employees in the dark regarding fair pay.
Same thing with buying a home nearby.
This is a good one for new fathers - be prepared
And so the dumb part, the unfair part, about salary discrepancies is that it is divorced from performance. It is divorced from value.
Which doesn't mean that you, on an individual level, shouldn't negotiate.
But it does imply that salary negotiation generally leads to results that (very) (incredibly) (if at all) loosely correlate with what the job is.
And all of this assumes that any two people walking into the same negotiations with the same skillset, exp, etc. will have the same experience. Which is, you know…not how it works.
This is a bit nonsensical. Nobody knows better than you what your time is worth because it is your time.
You don't owe companies anything, including working for less than you are willing to take in payment.
You need to be confident that you can find another job that pays equally or better in order to be truely using the leverage.
A lot of people don't have that security and cannot take that risk.
Do I remember the formulas or operations from my higher levels math classes? Largely no. Do I think they were a worthwhile endeavor? Absolutely, I was profoundly affected.
The long-term value of classes for those who largely won't use the skill in the future is the mind opening exposure, not the competency we test for.
I had many teachers who would give better grades to better people.
Who do you think is "better" or more deserving?
Every negotiation favors the person who can afford to walk away from the deal.
In a salary negotiation, this puts healthy, young, and single people at an advantage. It penalizes people with disabilities, disease or dependants - the most vulnerable groups.
That's where the demand for open and fair compensation comes from.
Thought experiment: if you were going to form a startup and needed two other engineers, would you know across your history which ones to pick from and which ones to avoid?
Then the engineers sharing their salaries with each other should also be reasonable. If anyone complains about the discrepancy, you can point out that the engineers being paid more are more talented.
Extending off of your thought experiment. If you were going to form a startup, and you believed that pay discrepancies corresponded to value, wouldn't you want interviewees to be extremely open about their previous salaries and their salary comparisons within previous companies? That would make it even easier for you to find the engineers who were the most talented. We already ask interviewees where they've worked -- would you feel comfortable asking them "how much money did you make in comparison to your coworkers?"
---
My feeling here is that companies want to hide salaries for the same reason my car mechanic would prefer me not to discuss my bill with any other customers. In an open market, discrepancies in knowledge about market rates favor the people with more knowledge; in this case, the companies. Companies are smart, not stupid; they understand how the market works. They're hiding salaries because that gives them an advantage when trying to drive down the price of engineers.
Whether or not pay discrepancies can be justified is kind of a false conflict. Regardless of whether or not pay discrepancies are a good idea -- in a free market, the prices should be transparent so that companies are forced to compete on honest terms for employees.
A generally applicable question that I've found applies to a number of situations beyond just this one: if a thing is good, then why do we need to hide it or force people to accept it?
If I found out I made less than someone else, I’d first see if I agreed with that call and, if not, use that signal to figure out what change I should make (in performance/level of effort, in communication/publicity, or in company).
People early in their careers have flexibility of moving around, but if you have mortgage, kids, family or need to take care of your parents, this strategy carries a lot of external costs.
For games speficaly it is nealry impossible to negotiate meaningfully because every postion is budgeted ahead of time, including salary increases. By that I mean if someone asks for 5% increase, they are basically negotiating against spreadsheet, not human across from them. The best one can do is to hit just under the cut-off line.
On top of that, employee providing different "value" to the company is just a myth, because if someone was literally providing value to multi billion company they would be paid millions. For most people their value is just replacement market value.
If people want a meaninful compensation in games, they have to be an executive or creating new revenue stream for the company.
There are multiple definitions of fair. One definition is people are paid proportional to how well they do their job. With that definition, bargaining for something else is actually unfair.
Everyone is replaceable. True that it is much harder to find a new dev or manager, but they still exist. I believe thinking a bit outside the box is a good idea, doesn't mean you have to start a workers union.
And while it might not be fitting to single out Blizzard as a company here, I think this "compensation" is taking the piss out of employees.
But then I consider, I've seen many individuals who are such strong engineers AND communicators, and deliver amazing work.
Yet, I was constantly paid higher than them, simply because of my more aggressive/arrogant attitude.
Time has given me a different view. There ARE pay discrepancies that shouldn't exist, but do simply because of lack of information.
And companies fuel the idea that it's something we need to protect, from our fellow colleagues because we worked/earned those pay discrepancies.
But in the end, it's the company that benefits the most from those discrepancies. Not me and not you.
I tossed 2 months of PTO to leave that industry(yay Washington laws) and made up the difference in the first 2.5 paychecks of the new gig.
Be careful of industries that over-index on "passion" and don't compensate people accordingly. Last I checked that industry was still built on chewing through new faces every ~3 years or so. Taking care of your people makes business sense and I wish more companies got that.
For a while I was working as a server-side programmer for a major gaming company making a MMO game based in Eastern Europe. The background of my manager was network programming, and they did a lot of network programming, so he hired me as network programmer, not a game programmer. Salary was world-class.
Then for personal reasons (got married) I moved to London, UK. The same company had an office in London but they were only hiring gamedevs for the same job. Those guys were offering less money in London then I had back home.
Long story short I do my server-side programming in a social network company now.
I went back and did the numbers, it was closer to $6hr but well below minimum wage for a dev position. From the little bit of salaries I heard art, design and test had it even worse.
That is to say, due to “passion”, entry level game programmers aren’t making much more than $40k a year. They have no negotiating power going in, since there’s a hundred others who will willingly take their place at the low wages, just to be in the videogame industry.
One consequence of this is, in companies that are willing to do it, it can be useful to negotiate a title promotion even if they don't give you a raise, because you can then use that title in your next job negotiation.
BTW, giving this advice depresses me. I'm constantly amazed companies make such a weak effort to retain employees via good compensation policies. The cost of recruiting and interviewing candidates, not to mention training new hires, is huge.
As a team leader let, I have been so frustrated with this. HR has no clue on how time consuming is to transfer context knowledge. There is a point where companies should do all in their power to keep people. But they fail to account for these types of indirect costs.
It is not consuming HR's time, I suppose. Therefore...
The general problem is that different parts of the company are evaluated based on their separate metrics, which usually ignore the "externalities" they create for each other. Sometimes those externalities are caused by incompetence that isn't captured in the metric. (Imagine that you would pay developers by the number of lines they write, but no one would ever check for bugs. If one day the developers start producing really bad code, their measured productivity stays the same; it's the measured productivity of the users that would plummet. The developers might even get a bonus that quarter, if they produced more lines of code than usual.) Sometimes the metric is actively harmful, so that doing the right thing would actually hurt the measured productivity of the department. (Imagine that the developers are paid for introducing new features, but no one acknowledges the existence of bugs. It would be a nice thing to fix at least the worst bugs, but doing so would mean the developer stays behind at implementing new features, and gets fired. So even if the developer is fully aware of the situation and wishes to fix the bugs, out of self-interest they would choose not to.)
Clearly it's not more than the cost of providing higher pay. Most people would rather not switch jobs as there is considerable risk involved if you're not performing labor that results in very profitable sales.
People would rather work with the devil they know than the devil they don't, so unless they're in upwardly mobile careers such as engineering, law, finance, or medicine, they probably don't have many good options.
Usually if you're debating management, especially non-technical management, solid numbers win out over hand waivey numbers, even if the hand waivey numbers are representing something far more important and the solid numbers are representing something in a very limited context.
An example: Tom is a mediocre programmer, but he's worked for the company for 5 years and has a lot of institutional knowledge. He wants an above average salary now. Should we give it to him? The obvious answer would be to let him walk, he's asking for more than he's really worth. Ok, but how much does the equation change if we factor in that it's going to take 3-5 months to hire his replacement, and you'll need to interview about 20 candidates, some of them for multiple hours, not to mention potentially flying them out? Also now Tom is walking with his institutional knowledge, and the bugs that used to go to him are going to someone that doesn't have the 5 years working with the system he does, so whoever has to pick up his slack is going to be slower than Tom is even if they're a better programmer overall.
So I wouldn't say it's 100% clear whether a company saves money retaining employees vs training new.
On the other hand, turnover can bring a new perception to a problem. I have no idea what the value of that relative to the cost of recruiting and onboarding. In some companies like FAANGs it wouldn't surprise me if some level of turnover was intentional. Google probably benefits to some degree by hiring engineers that just quit over at Amazon; it gives them an insight into how Amazon is solving X problem, which may inform how Google tackles that problem.
https://docs.google.com/spreadsheets/d/119RI3oS9XNOjq2X8VLpU...
When oh when are midrange tech companies going to get their shit together with raises and bonuses.
10% should be mostly seen as a (shock) _normal_ raise when the company is doing well, above and beyond annual equity and a bonus at least in the range of 10-15%.
Stop giving people reasons to job hop every few years. If you want loyalty and you want your investment in employees to pay off over time, give them good stuff! Give it to them before they reach any point of questioning if they want to go to the next company down the street for that extra 15% raise you were too stingy to give them on merit.
As a manager, I can safely say the worst compensation mistakes I made were cases of not giving enough compensation sooner rather than later, and giving good people a reason to leave over money.
I learned my lesson fast, and can say later in my career I take compensation planning much more seriously and absolutely do not ever settle for company pay band crap and scheduled 3% / 5% raise crap. If someone is doing good work for you, pay them!
I've always had the philosophy that if you want to retain good employees, pay them more before they ask for more. If they have reached a point where they had to ask for more, they're probably going to leave soon.
I don't understand how do companies fail to realize this. Say an engineer leaves because you didn't get him that 20% pay bump. Even in the highest ranks of engineering, that's like what a 100k? 30k-40k on an average. Now imagine you go through the whole recruitment cycle. You have anywhere between 8-12 weeks of productivity loss of an engineer. Then you waste time from the productivity of recruiter, hiring manager, hiring engineers on the team, etc., all of whom are highly paid. You cycle through 8-10 candidates. Then you finally get the person you need. In my experience, it takes at least a month to get onboarded, usually more. And it takes at least 6 months to get to productivity levels of the engineer that just left if your new candidate is good. All in all you wasted almost 6 months of engineering time worth of productivity, which easily exceeds the money you saved not giving that 20% raise. All of this, assuming the new guy didn't negotiate more than the previous one. Seriously, get your shit together.
On the converse, your boss doesn't pay the cost of hiring new people. It doesn't come out of his pocket. But giving 20% raises to everyone he has the suspicion of leaving will get him canned real quick, imposing a real and sizeable cost on him.
The tippy top dogs of the company aren't completely stupid for running things this way. Budgets would get out of control in a hurry if they let managers do whatever they want with wages. Nepotism would run rampant without costly oversight and surveillance. Employees would learn to take advantage of easy raises.
So the company bears a smaller cost (employee turnover) rather than the bigger and unpredictable costs of frequent and decentralized wage raises.
There's not a great solution to this. It's an example of market failure. Everyone acting in rationally on an individual scale does not lead to group rationality.
Most typically middle managers are not allowed to significantly alter budget for bigger raises that retain important people, yet are then punished or admonished over the comparatively worse budget loss taken through recruiting and onboarding to hire a backfill, as well as getting a reputation for being a bad manager if you can’t work miracles and retain people who deserve raises without giving them raises.
The economics don’t work out the way you describe at all, and few parties in the situation act rationally.
It’s not acting in self-interest for executives to create unnecessary turnover due to withholding appropriate compensation. This leads to worse financial loss than paying high raises, and ultimately executives and managers get fired regularly by acting against their own self-interest by withholding meritocratic raises.
https://courses.lumenlearning.com/wm-macroeconomics/chapter/...
A great way to think about this is voting. If we were all acting logically, everyone would vote, because in theory, we'd all be better off. But because of the principle of rational self interest, many or most people don't vote because the cost of researching candidates and policies and going to the effort of voting is very often higher than the benefit (a 1 in 100,000,000 chance of influencing the outcome of the election)
Like topics from Predictably Irrational, Irrational Exuberance, The Winner’s Curse, Moral Mazes, Thinking Fast and Slow, countless articles on LessWrong sequence on cognitive biases and heuristics, research on Last Place aversion, etc.?
Your comment seems to presume a textbook definition of rational self interest actually describes the behavior of living organisms, but it profoundly does not.
Remember, someone acting in their own rational self interest does not mean they will never experience deleterious consequences. It simply means people will take actions they think will result in the best const/benefit for them.
The research is clear that even when confronted with proof their actions will not result in the outcome that people self-identify as the outcome they desire, they nonetheless knowingly engage in behavior that makes them worse off (under their own preferences and utility) than other options available to them.
“Is our turnover similar to peer companies” is a categorically wrong question to be asking. “Could I save more money by paying better compensation and realizing less turnover” is the only rational question to ask - yet business people who are great at pursuing rationally optimal outcomes in their business offerings to customers often fail tragically to apply similar simple cost/benefit economics to their treatment of employees, and either leave money on the table they could otherwise have had, or more often create conditions for completely failed business units, failed products and ultimately failed companies.
I wish more managers/executives would understand what you just explained and how badly it hurts their business to constantly have employee turnaround. I have yet to meet a manager or executive who consistently understands motivation and rewards it properly in the way you describe. There are other handcuffs though, especially in the software industry: tech stack, pay available in the area, remote work, flexibility, and now corona.
It comes down to supply and demand. There are legions of young, passionate gamers who want to “work with their passion”. Why they stick with it, I’m not sure. I certainly didn’t.
That's the key quote in the article for me. If you feel that your compensation is below market rate, switch jobs and prove it.
Imagine how many game devs there are who are roommates with web devs, or who went to college together. How is it that the web devs don’t tell their friends “you need to quit that awful 90hr/week job that pays you shit and come work at my company”? Or why don’t startups try to lure game devs? I’m sure many of them could figure out Rails or React in no time. They would surely be able to offer slightly lower wages in exchange for a (comparatively) better work life balance.
Apart from "The job" work is not a mental and emotional void. You invest yourself. And it hurts when your investment is ignored or treated as lesser than another human.
Employee pay should be two parts: - salary as per usual - significant stock in the business. NB: significant. 50% of stock(non-voting, purely monetary) is for an "employee fund" and come dividend time it is shared equally among employees. People get their salary they can preen over. And company profits are tied to individual motivation.
Why should I care if the company does astoundingly well as opposed to being mediocre if I don't have a stake in the outcome?
But the system you built doesn't necessarily achieve the goals you want. If everyone gets the same dividend it becomes a tragedy of the commons since an individual player can do the minimum while profiting off other players actions. Even if its varied in dividend for example one person gets 10% while another gets 40%, this still applies as a player with the strategy of being mediocre will still get benefits of the hard work of all other players while minimizing the amount of work he has to do.
Not only that, businesses are meant to make money if the people who start the business is giving out half their money away this system better make 2x the revenue every single quarter or why would they do it.
US business has a history of "stock options" and "yearly bonuses". So this isn't new. (I haven't seen it here in Australia as a common thing.)
> If everyone gets the same dividend it becomes a tragedy > of the commons since an individual player can do the > minimum while profiting off other players actions.
They still don't get the same salary as you. Unless they do in which case, no real change.
Alternately, if the company is making megabucks to the point where salary becomes insignificant, then I am ok with others being better off too, even the dead weight.
Also, you could argue that with everyone in the company wanting a bigger share, this puts pressure to remove the dead weight. 1 less employee means a bigger share for me. 1 more productive person(as opposed to dead weight) means more for me.
> Not only that, businesses are meant to make money if > the people who start the business is giving out half > their money away this system better make 2x the revenue > every single quarter or why would they do it.
This doesn't change the idea of businesses making money. Just who they should be making it for. It doesn't force a bonus every year. It just says that if rentseeking investors get dividends, employees do too.
Do we want a society whereby rich people can buy shares and then seek rent forever, using that rent to buy more shares etc.
Or where the people who do the work, get the rewards?
I understand that floating publicly is used to draw large sums of money for business to do great things. But it is also used as a forever debt, to pay shareholders forevermore for doing nothing more. Under this scheme, those investors would do their sums differently, obviously and it may well come down to the business getting "less for their float action".
But I like the idea of trying not to trample salaried employees to make others rich.(Many startups do in fact operate on stock option basis. I'd just argue the stock options should be equal value, from the CEO to the cleaner.)
Honestly, I'd prefer more than 50% go to employees - I hate "rentseeking" - but lets not go crazy.
I.e. you can go to the tax agency (or town hall) and ask for data on a given individual since 1973, but you can't just publish it willy nilly.
In 2008 the tax collecting agency decided to put all of them online, as that seemed like a reasonable extension of the 40 year old rule, and there was a huge shitstorm[0].
At some point the privacy authority stepped in and imposed them to hide it again, citing a lot of more and less valid concerns.
[0] which in my modest opinion proved it was a great idea
This probably hints at why I am unlikely to actually end up running anything, but in the off chance lightning strikes...
In the future, I plan to add support to predict salary from Linkedin profile. So based on education, experiences, role, the browser extension can predict the salary range. I'm thinking of adding a way to share the salary range in this application in a safe way. The mission of my application is to democratize the salary ranges.
This way, in the future, workers in other companies (other than Blizzard) have the ability to know the salary ranges in a convenient way.
There's a thing that happened last year that wasn't picked up by any major news sources. It was really troubling to see it completely swept under the rug. I can't even find a "reputable" news site that covered it:
https://www.gamesindustry.biz/articles/2019-01-09-former-bli...
Unless you are an executive, don't expect someone to give you huge salary increase for your performance. At best, even when your manager is very satisfied about you, (s)he is limited to the percentage range that is defined by HR for salary increase. Even if you get better title, the salary increase is still limited.
For big companies, if you take all of the exec pay (C suits) and give it out to rest of the employees, the average employee income only rises by 3-5%. While CXX packages are extra-ordinary, one has to understand that its often drop in the bucket for big balance sheets and even less relevant when you have couple of hundreds of thousand employees around.
So the metric of disparity we should use is not max/min salary but rather avg % increase if CXX salaries were all given to employees.
American public company executives are grossly overpaid, and there’s been numerous studies proving this. Both historically in the US (exec pay has ballooned here since the 1980s) and currently in most other developed countries, companies with lower exec compensation don’t show lower ROE when sorted by industry.
Exec compensation in many American companies is basically normalized theft from shareholders given the revolving door of incestuous boards and C-suites and the constant conflicts of interest.
However, the money execs are looting from American companies doesn’t belong to employees. It belongs to shareholders. So a metric of giving that money to employees is irrelevant. Employee salaries are (and should be) set by broader market demand.
It was generally accepted 15 years ago that paying 2 and 20 in fees for a hedge fund was reasonable compensation.
Then everybody realized that 98%+ of hedge funds aren’t providing alpha and were basically stealing money from the ignorant.
A similar realization will eventually happen on exec compensation as we get more data.
Their pay increases would be inflation indexed and tied to "rising tides lift all boats"
If the Cxx team each makes 100x what the average employee makes, it doesn't matter if there are 10 employees or 10,000. There's rampant income inequality either way.
Or unionize. You are tech people. You can setup setup your own loomio (or whatever decision making software exists these days) server and start making decisions today. Be the change you want to see.
This is execspeak for screwing the majority and only giving their chosen few a decent raise.
Job title makes it clear that it's about greater responsibilities.
"Why is Jeff paid more than me"
"Because Jeff is senior dev and you're junior dev" is a much easier conversation to have, and everybody's job title is very visible.