Hacker News Reader

Comment by chii | Hacker News Reader

> board-level employee representation

I recall reading an article that for some companies in germany, the board-level employee representative have successfully negotiated during the GFC, to not have layoffs, but instead collectively took a pay cut and survive through the difficulties. The company got to retain the talents and save on the costs of retraining etc.

Having a dissenting voice can lead to better ideas. However, if the intention is to prevent employees from being fired even when it is in the best interest of the shareholders, then this employee representation is only going to decrease the shareholder value, and ultimately the profitability of the company.

> collectively own a non-trival amount of corporate stock.

how do these stock get granted? Because if the employees themselves pay for the equity, then they're part owners. If they don't actually pay, then they'd be usurping control in a way that is not fair to those paying the equity.

View on HN

Personally as an employee I’d rather have a layoff than a compensation cut. Even if I’m affected I’ll take my chances finding a different job at high compensation.

As an employee you don't have a lot of say in that decision.

« Personally as a tech worker » I imagine?

I am pretty sure most non tech people around me would take the pay cut over the risk of becoming unemployed for an uncertain amount of time, having to find a new job, maybe moving to a different place etc….

Are we talking standard layoff of 1-2 weeks of salary pay per year worked at a company or are we talking about the insane packages only FAANGs give? Because that goes without saying.

You're not in the United States, I presume, or have never been on work visa! In the States most important benefits (like healthcare) are tied to your employer, no job means no health insurance. If you're out of job on work visa, then you either find a new job within (about) 2 weeks to sponsor new work visa or leave the country, abandoning everything you might have built. Unfortunately being unemployed, no matter your pay, is not an option for lot of people.

A government is only as good as it's opposition. Having a strong range of voices and differing viewpoints on the board is a good thing. Employee representation is one of those range of voices

It's not really the end of the world if shareholders lose a little value in order to enrich the employees. Cuts down on the chance of socialist revolution.

> If they don't actually pay, then they'd be usurping control in a way that is not fair to those paying the equity.

From a capitalist point of view. Socialists would argue that shareholders are already usurping the labor of the employees by not paying their fair value.

> labor of the employees by not paying their fair value

but then you have to question the idea of what fair value is. The market rate is a pretty fair value to use. The argument that the employee's wages are always less than the full market value of the goods/services they produce, thus they must not be paid their fair share, is not correct - what happened to the capital that the employees uses to produce their output (the guaranteed wages are also considered capital in this case)?

I'm not actually a socialist, so I have no passion to argue this, but you could make arguments about how the labor markets are constrained by the current rules that favor capital (both in legal and tax treatment), so we don't actually know the fair value of an individual's labor in most markets. Also corporate consolidation has suppressed wages and limited avenues for entrepreneurship, so that further reduces the paths to prosperity for most people. Someone would probably also point out that employee wages are hardly guaranteed given that 49 states are at-will, and Montana has fewer people than the city I live in; virtually all Americans can be laid off tomorrow for any reason other than race or other protected status (and even then, we all know there are ways around those laws).

Again, I think capital should get profit in exchange for risk taking and organization, but there is no moral argument that shareholders should continue to rake in record profits while working Americans continue to get squeezed tighter every year. At what point does it become rent?

Reply on news.ycombinator.com