Paying a wage = sharing your profits, just not on a % base, but a fixed amount. But in the end it's still: less profits for the founder, and more profit for the employee.
My Assumption here is that the common usage of profit is, "Money after all expenses paid", which employee compensation is clearly outside of that definition.
Money is fungible and what we identify as "expenses" versus "profit shared" is arbitrary. Economic value is created by the enterprise, and that value is then split between the owner, the employees, the suppliers, and the customers.
We can argue about whether the distribution is fair, but complaining about the specific accounting method by which the value is distributed is myopic. Either you're getting a fair share of the economic value or you aren't—whether your share comes of the pre- or post-tax portion of the pie is the government's concern, not yours.
Workers: "We should see more of the profits the company makes and we are making the case that collectively we produce a larger portion of the value we're asking for"
Poster: "Your pay is part of the profit, the more money you make the less that goes to the owner"
You're right. I shouldn't assume a framing is misleading just because its unorthodox, I'm attempting to make a case for the framing being misleading with supporting statements.
At best the parent comment isn't saying anything of substance at all (in response to ITS parent comment), and in my view, at worst its an attempt to redirect the concept of 'profit' to make the argument seem less credible.
ceronman's thought experiment was "if you have employees, you have to share your profits ... If [they] don't produce any value, easy, fire them all, you get everything."
jerrre's response, which I think is fair, is that we're already running this experiment. If businesses did not think employees produce value, they would not pay them wages or salaries, because every dollar paid to an employee is a dollar less of profit for the company. Companies already acknowledge the value that employees create value by the very fact that they pay them anything.
In other words, what's actually at stake isn't whether employees create value but how much, and ceronman's comment doesn't contribute anything to that discussion.
I believe they were making the case that Employees need the company as much as the company needs the employees. The experiment is to split the profits evenly amongst those who created the value in the first place - The people that work inside the company. If they can't produce the value, get rid of them (And if that's the case there's more profit for everyone right?)
They could also mean that the profits are distributed amongst the employees based on individual contribution when they conclude that there wouldn't be any self-made billionaires because no single individual produces that much value.
I still disagree with the conflation of wages/cost of business and profits, even though more mages means less profit - Profit is still surplus after all has been paid. The distinction is important for more than just the scope of this conversation.
1. Debt is built into your existence (student, medical, housing, etc);
2. The system is designed to extract (exploit) value from labor; and
3. There is no value without labor.
[1]: https://www.antislavery.org/what-we-do/past-projects/india-d...
Fixing the problem would mean that instead of the 'owner' hiring an 'employee,' they instead form an equal partnership as co-owners. Because the business serves the interest of the owners, it will seek to maximize their compensation as the ultimate goal, rather than to minimize their salary as a way of reducing expenses.
They could perhaps give the worker a minimum wage and the rest pay in dividends, but mind that dividends need to be distributed among all the shareholders equally, so you can't say you would pay $100,000 unless you allocate shares so that when dividend pay out is decided, worker's shares will yield that exact amount.
Which is to say that cost/value proposition is never simple. I've been at companies where people were paid simply not to jump to competitors.
The problem is that in most cases you can't do that. You might have been the person who made the last push to make the revenue possible, but you were building on the work of everyone else who was working for that company and you were leveraging someone else's resources to make it happen.
We have to have some way to agree what portion of that profit can reasonably be attributed to you. To avoid complicated math and guesswork every quarter, most of us agree to a fixed salary as a reasonable estimate for a fair share of the value we're creating.
I want it to be an equal equity corp basically every hour invested earns you shares based on your senior and tenure.... Sr dev multiplier x 2 years with company for example.
Then we'd earmark like 30 percent of revenue to go into profit sharing and each state gets a reward.
The shares also calculate your voting threshold.
Senior team will be given an edge so there's an ethical dictator but not an insurmountable thing.
It might take 10 people to out vote the execs but you can't buy shares it's all earned by actions and time investment etc...
I also want to build an ERP system that can actually run a co-op like this with multiple streams of income, multiple point pools to reward employees or even customers etc....
It'd also network with other co-ops to build symmetry like Amazon marketplace does for sellers, everyone would be invested in every other syndicated companies success.
Sales people often can get up to or more than 50% of the profits (after all expenses) as commission. I've seen up to 80 or 90 percent for companies with extreme growth focus.
Programmers don't generate value directly the same way, but often you can attribute value to products they create and compensate them fairly.
The bargain I've made instead is that I get a very good base salary and call it a day. When the company grows because of my contributions, I negotiate a higher salary, but I don't have to think about it from month to month.
I'm just saying, if I have an employee and he makes me $1m a year, I'm going to pay him well - I'll pay that employee what is fair in the context of what value we enable him to generate for us.
That usually means the employee is worth at least 50% of that in compensation, btw.
This is why if you bring a deal to a company as a sales person commissions are around that number (50% of profit).