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Why I’m Against Unions at Businesses I Create
- khazhou 9y ago> That’s why the type of company that interests me is one where ownership and the employees are truly in it together, > Everyone at a company – owners and employees alike – need to be sitting on the same end of the seesaw Never mind that the founders or CEO will have 1000X more equity than you, employee (if you have equity at all). You're in it together!
- aspenmayer 9y agoThat just gave me an idea. What if it were the norm to be paid in cryptocoins linked to the value of the company you worked for? So instead of making 100K a year, you made 100 AnyCorpCoins, which the company's internal payroll exchange or any compatible cryptoexchange will change for dollars happily? The company could peg the coins at their own employee-only values to prevent major market fluctuations from devaluing your salary, and it allows employees and non-employees to earn stake in the company simply by holding the coins. Thoughts?
- coryl 9y agoBasically sounds like some class of shares in a corporation?
- brians 9y agoCan the company tell how many you have, and draw conclusions about how committed you are? I think this is being paid in stock options. Many people choose to mix stock, options, and cash in compensation.
- aspenmayer 9y agoI guess I'm thinking of a periodical rolling ICO with employees being able to buy in early, often, and at a discount.
- hiram112 9y agoIsn't this equity and stock shares, without the extra conversion step?
- eropple 9y agoWhat if it were the norm to be paid in company scrip with no meaningful value to anybody outside the company? Why is it that engineering types don't pay the least attention to history...? Why is it that engineering types think that sprinkling crypto on it solves a single meaningful social ill? Hiding the scrip behind "crypto" does nothing. Who's going to take your FacebookForCatsCoin when they could have actual money instead? A random speculator? Meanwhile, who's gonna take dollars? Jeez.
- aspenmayer 9y agoI'm not advocating for this, but it is an interesting thought experiment. I do share your concerns, but I feel that this kind of thing is likely inevitable with the rise of ICOs and cryptocurrency futures trading. Capital flows will make a market of it somehow, even if it's only quants and AIs who are able to operate such a market in meaningful, value-adding ways.
- eropple 9y agoI'm gonna be straight with you: it's an interesting thought experiment if you ignore the entirety of the history of the industrialized world. If you don't ignore it, it's not even novel. ICOs are valueless trash in ninety-nine-point-nine-nine percent of all cases. This will only change, maybe-if-you're-lucky, if they are securitized and regulated, at which point it's the new "oh but stock!", and it's still not going to be a sane deal for a worker because the worker has no real way to deal with either counterparty risk of exchanges (meanwhile, dollars involve no such risk) short of paying a vig--you know, like how companies pay poor employees on debit cards with fees, how's that reality sound for everybody?--or safety of exchange rate, because LOL your company has a bad quarter and now you can't pay your rent because FacebookForCatsCoin no longer makes the speculators, the only people who are paying attention to it, sufficiently money-horny. Sprinkling crypto on company scrip doesn't make it anything other than company scrip. And it's a bad idea for companies, too, because a mere, what, ninety-nine percent of companies have no public stock and would very much like to keep it that way?
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- joe_the_user 9y agoWhat if it were the norm to be paid in cryptocoins linked to the value of the company you worked for? Well, it's usually the norm for employees to be paid enough to get food, clothing and shelter. In your norm, this normal might not hold. Perhaps employees would be so upset in this case they'd form a union - or maybe just quit in en mass.
- wingerlang 9y agoThat's just shares isn't it? Imagine 100 employees having 100 coins each, and then the company tanks. No thanks..
- pmoriarty 9y agoWe're all in it together to make the founders rich.
- Turing_Machine 9y ago"Never mind that the founders or CEO will have 1000X more equity than you, employee (if you have equity at all). You're in it together!" Okay, I'll bite: why shouldn't the founders and investors have a lot more equity than the employees? If the business goes belly-up, they lose everything they've put into it, while an employee just goes out and finds another job. Risk and reward need to be related somehow, surely?
- pyromine 9y agoEmployment is not a happy-go-lucky partnership. At the end of the day people have jobs because they need to eat, the point was not that founders shouldn't have more equity it was that their incentives are not aligned. Lower wages is good for the employer and bad for the employee, it is adversarial and sugar coating it as if it's not is bullshit. (Not that I think companies can't have good relations with their employees, just at the very least wages are adversarial)
- Turing_Machine 9y ago"Lower wages is good for the employer" Not if the wages become so low that qualified employees refuse to work there, it isn't. There's nothing more deadly to a business than crappy, unmotivated employees.
- manicdee 9y agoWhat is stopping the founders from “just finding another job”? Losing “everything they’ve put into it” suggests that the founders will actually lose money if the business fails, where in most cases the business goes bankrupt and the founders only lose whatever seed capital they put into the venture before incorporating as a limited liability venture (specifically to limit their personal liability). The employees also lose eveything they put into it, which is however many months or years of their life they contributed to the venture.
- Turing_Machine 9y ago"What is stopping the founders from “just finding another job”?" Do you really not understand the concept of equity? "suggests that the founders will actually lose money if the business fails, where in most cases the business goes bankrupt and the founders only lose whatever seed capital" Oh, they only lose their "seed capital" (plus all the --usually unpaid -- work they've put into starting and growing the business). That makes it okay, then! "The employees also lose eveything they put into it" The employees got paid every week, dude.
- iAMAGuest 9y ago> Never mind that the founders or CEO will have 1000X more equity than you, employee (if you have equity at all). You're in it together! It's a falsehood to think that every company is a profit machine, many employers are small business so 1000x more equity is not really much.
- adrianN 9y agoIf it's not all that much, why not share it equally among all employees. You want everybody to be sitting in the same end of the seesaw, right?
- khazhou 9y agoFounders have the courage to sit on the risky and stressful side of the seesaw. Haven't you heard? Founders are not free to just walk away! The horror. </s>
- iAMAGuest 9y ago> If it's not all that much, why not share it equally among all employees. You want everybody to be sitting in the same end of the seesaw, right? Ok, but remember you take the good with the bad. Statistically more business fail than survive, so if you want to take that risk then why not. But even easier you could start your own business and share the utopian form of employment with your staff.
- deleted 9y ago[deleted]
- khazhou 9y agoGreat, we'll ignore them and focus on companies like the author's: Ameritrade. Also, every Silicon Valley company. And the point isn't whether a company exits or not -- the point is that the potential rewards are so lopsided, any notion of "we're in it together" is just idiotic.
- ChuckMcM 9y agoApparently Joe has never experienced being in a group suffering systemic abuse by their supervisors in ways that are not only barely legal but generally cruel. I have sometimes wondered what would happen if the only H1B visas that were issued were issued to union shops. Sort of a pre-built defense against some of the abuses. I have also seen union abuse, I was a member of the Culinary Union in Las Vegas as a busboy (everyone had to be) and they did not make it easy on the restaurateurs. The bottom line seemed to be that without some oversight ability somewhere, the more powerful group (unions or management) seems to have a tendency to abuse the other group. EDIT: I was reminded by an old friend that it was the Culinary union not the Catering union. Corrected.
- thisisit 9y agoQuis custodiet ipsos custodes? is always an apt question when someone argues against or for unions. There are no easy answers though.
- hiram112 9y agoI don't even know of any tech unions in the US. But I can guarantee you, if the typical middle manager told his group of teamsters or UAW members that not only were they going to be fired, but if they wanted their severance, they'd train their own replacements - a bunch of 20 somethings from <low wage S. Asian country> on a work visa - the manager would probably end up missing. It's interesting just how well the elites have trained us US tech workers to be good global, corporate soldiers.
- elevenchars 9y agoWhy I’m against taxes in countries that I live in
- redleggedfrog 9y ago"I believe owners and management promote a corrosive us-against-them dynamic that destroys the esprit de corps businesses need to succeed." There, I fixed that for you.
- cortic 9y agoIn short; 'JR' has better success in business when he can under-pay his workers and ignore their health and safety needs and human rights. As an unrelated side note; All my businesses would be successful if i could just use slave-labor.
- iAMAGuest 9y ago> In short; 'JR' has better success in business when he can under-pay his workers and ignore their health and safety needs and human rights. Being anti-union doesn't mean favoring slave labor or breaking laws. Many rights of workers are protected by legislation (depending where in the world you live), and unionism doesn't mean higher wages.
- bobbyi_settv 9y ago> Many rights of workers are protected by legislation That legislation exists because of unions
- jackvalentine 9y ago> Many rights of workers are protected by legislation How do you think those rights found their way in to the legislation, and remain there?
- iAMAGuest 9y ago> How do you think those rights found their way in to the legislation, and remain there? Look I not blind to the history, and protectionisms which came about from unionism. But that is a common retort, but also a bit of a straw man argument.
- jackvalentine 9y ago> but also a bit of a straw man argument. I wasn't aware I was making an argument.
- unchocked 9y agoWhat sheer drivel. >But, I’m neither a historian nor an economist. I’m an entrepreneur, so I’m not going to wax on about the historical imperative of unions and why they do or don’t serve a role in our modern economy. I will, however, tell you what I know, and I know about starting and growing businesses. I don't think we need much explanation on why an entrepreneur would prefer to dictate terms rather than negotiate with an organized workforce. >I believe unions promote a corrosive us-against-them dynamic that destroys the esprit de corps businesses need to succeed. Might you be mistaking the thrill of total obesiance for esprit de corps? You wouldn't be the first to... >That’s why the type of company that interests me is one where ownership and the employees are truly in it together, without interference from a third-party union that has its own agenda and priorities. Um, that nefarious third party agenda is the organized voice of your employees. Heck, we all appreciate being able to dictate terms, but not all of us are intellectually dishonest enough to come up with spin like that. >It is my observation that unions exert efforts that tend to destroy the Free Enterprise system. You haven't mentioned a single observation, just breathless, self-serving opinion. Were the shoe on the other foot, I'd expect to see you writing for Pravda. *edit: I'm beside myself with that Pravda comment. JR posted this literally today: "Attacks on President Trump Show the Political Class Has Learned Nothing" http://blog.joericketts.com/?p=581 http://blog.joericketts.com/?p=581
- TAForObvReasons 9y agoI'm genuinely amazed that this drivel made the front page of HN. It's not well articulated, not substantiated by any evidence, and succumbs to common fallacies like appeal to authority.
- marak830 9y agoPerhaps made it to highlight said drivel? I upvoted for that reason.
- flunhat 9y agoThe context here is super important - Joe Ricketts, who owns DNAInfo and Gothamist, just shut them down today entirely, firing everyone and taking all their content offline. Worth noting that this happened after employees voted to unionize. I think that's why this is getting upvoted now.
- vacri 9y ago> I believe unions promote a corrosive us-against-them dynamic that destroys the esprit de corps businesses need to succeed. The divergence of who gets the money in a business over the past few decades makes it pretty clear what business managers (in general) think of that esprit de corps. With CxOs taking more and more multiples over line employees, it's pretty clear there's an us-vs-them line anyway, regardless of whether unions are involved. > It is the Free Enterprise system that has made this country an economically wealthy and powerful nation and I enjoy participating in it. Well, that and killing or enslaving people and taking their stuff. The role of the US military in the US economy is so often ignored. Even today, the US economy sees benefits from the USN being able to project power anywhere on the globe.
- jackvalentine 9y ago> But, I’m neither a historian nor an economist. Go to his bio: > After graduating Creighton University with a B.A. in economics in 1968 He on at least some level an economist.
- jadell 9y agoThere's only two effective ways to prevent your employees from unionizing: 1) get government and law enforcement on your side and use force, or 2) treat them like human beings with their own desires and goals and make sure your business supports them in those desires and goals. I guess a third way might be to find a bunch of employees who don't know any better, or enjoy being taken advantage of...
- arma26 9y agoWhy not just operate a company in such a way where unions don't feel like they need to exist? Unions are a self defense mechanism and a symptom of a failure in trust between employee and employer. Unions aren't about logic, I don't see the point in reasoning why unions should or should not exist or trying to sway opinions before/after the fact. > "I believe unions promote a corrosive us-against-them dynamic" Unions are a blunt instrument people feel forced to use to correct a "corrosive us-against-them" culture. Unfortunately unions create as many problems as they solve, but at least they won't have to worry about putting food on the table, everything else is tolerable.
- cratermoon 9y ago> Why not just operate a company in such a way where unions don't feel like they need to exist? And watch as investors and the rest of the financial community trash your company for not putting profits first. 1 http://www.latimes.com/business/la-fi-american-airlines-raises-20170427-story.html http://www.latimes.com/business/la-fi-american-airlines-rais... 2 https://www.cnbc.com/2017/10/18/chipotle-downgraded-employee-pay.html https://www.cnbc.com/2017/10/18/chipotle-downgraded-employee...
- jordanb 9y ago> And yet, 2017 looks a lot different than 1917. Yeah inequality is worse in 2017 than it was in 1917. http://peakwatch.typepad.com/.a/6a00d83452403c69e20120a573774a970c-pi http://peakwatch.typepad.com/.a/6a00d83452403c69e20120a57377...
- pikma 9y agoI'm glad to see many people defending unions in this thread. If you are interested in learning more about unions, I recommend reading Confessions of a Union Buster, by Marty Levy. Any other book recommendation about the topic?
- ldiota 9y agoI believe this guy is the owner of Gothamist, whose staff recently voted to unionize. He closed the company today.
- mark-r 9y agoI've always felt that unions are the wrong solution to the unchecked imbalance of power between management and employees. Two wrongs don't make a right - the antagonistic atmosphere created is absolutely poisonous. Unfortunately I don't have a better answer.
- skanga 9y agoShould we also BAN the ability of Management to fire their workers? Because layoffs also promote a corrosive us-against-them dynamic that destroys the esprit de corps businesses need to succeed.
- lokedhs 9y agoA lot of countries do that already, in particular in Europe. Having worked in such environment, it has both benefits and drawbacks. My personal opinion is that it should be difficult but not impossible for companies to fire employees.
- tarboreus 9y agoWhat a shock, someone who creates companies doesn't like unions. And usually CEOs LOVE when their employees unionize!
- kapauldo 9y agoKids who don't read history become confident in poorly supported contentions.