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As a manager, I've always felt that I have zero incentive to pay anyone under a fair market rate. I also have always managed salaries in such a way so that if w

As a manager, I've always felt that I have zero incentive to pay anyone under a fair market rate. I also have always managed salaries in such a way so that if we had open salaries, there wouldn't be any surprises and no one would feel they weren't being paid fairly. Most people I know in similar roles to mine act in a similar way. So I'm not so sure that most companies are really out there trying to underpay their employees. In terms of running the business, I want to pay people fairly for a good day's work.

roel_v 10y ago
"As a manager, I've always felt that I have zero incentive to pay anyone under a fair market rate." But are you a line manager or is part of your performance KPI's the profit of your unit? Or are you an owner in a small business whose own income is directly influenced by salary expenditure, like when you're running a (small) body shop or sell hours? Those are all very different situations to be in.
throwaway4job 10y ago
I don't try to underpay employees, ever. I try to make sure I never lose an team member because of a dumb comp issue. However, open salaries would be problematic for me, because I've made some bad bets on new hires who are overpaid compared to what they deliver, but where it's not reasonable to fire them either. Imagine, for a moment, a team with 100 engineers, 96 of whom I think are paid fairly. But 4 of them are, in my opinion, overpaid by 25% or 30%. I could fire those four, but that would cost me more than freezing their pay until they level up, or a lot of time passes. so instead, I keep them on, and hope their peers don't find out what they make, because they might come to the wrong conclusion.
kbutler 10y ago
Throwaway4job wrote: > open salaries would be problematic for me, because I've made some bad bets on new hires who are overpaid compared to what they deliver, but where it's not reasonable to fire them either. Open salaries would give you precisely the leverage you need to reduce those employees' salaries. "Your initial salary was X, expecting better-than-average performance. Your performance has been comparable to Amy and Ben, so your salary now matches theirs." They would either accept the reduction or would leave, without you having to fire them. The bigger problem would be it would tend to reduce the variance in salaries (why does Carl get 50% more than I do?), which may result in under-paying top performers, reducing their incentive to stay.

roel_v 10y ago

"As a manager, I've always felt that I have zero incentive to pay anyone under a fair market rate." But are you a line manager or is part of your performance KPI's the profit of your unit? Or are you an owner in a small business whose own income is directly influenced by salary expenditure, like when you're running a (small) body shop or sell hours? Those are all very different situations to be in.

throwaway4job 10y ago

I don't try to underpay employees, ever. I try to make sure I never lose an team member because of a dumb comp issue. However, open salaries would be problematic for me, because I've made some bad bets on new hires who are overpaid compared to what they deliver, but where it's not reasonable to fire them either. Imagine, for a moment, a team with 100 engineers, 96 of whom I think are paid fairly. But 4 of them are, in my opinion, overpaid by 25% or 30%. I could fire those four, but that would cost me more than freezing their pay until they level up, or a lot of time passes. so instead, I keep them on, and hope their peers don't find out what they make, because they might come to the wrong conclusion.

kbutler 10y ago

Throwaway4job wrote: > open salaries would be problematic for me, because I've made some bad bets on new hires who are overpaid compared to what they deliver, but where it's not reasonable to fire them either. Open salaries would give you precisely the leverage you need to reduce those employees' salaries. "Your initial salary was X, expecting better-than-average performance. Your performance has been comparable to Amy and Ben, so your salary now matches theirs." They would either accept the reduction or would leave, without you having to fire them. The bigger problem would be it would tend to reduce the variance in salaries (why does Carl get 50% more than I do?), which may result in under-paying top performers, reducing their incentive to stay.