3 ms·

Why? It would only be bad if your effort was not recognised by me and compensated accordingly. This would be bad management. Your pay should be determined by w

Why? It would only be bad if your effort was not recognised by me and compensated accordingly. This would be bad management. Your pay should be determined by what you can earn elsewhere and if you are an employee that performs above average then you will likely be paid more than the average employee elsewhere. Being able to reward high performance is one of the great things about having a smaller business. In big companies or the public sector this is often not possible, but if I want to pay someone more I can.

dman 9y ago
There is a subtle issue that comes into play here a. High performance employee who works at employer A has already given ample evidence of going over and above usual metrics of efficiency. b. High performance employee decides to go into the market and shop around but other prospective employers have to largely take the employee on their word and their portfolio about their performance. Since these prospective employers have not yet witnessed the said over achievements, rationally speaking they would apply a slight discount. c. Given the above, the existing employer can use the information asymmetry wrt to other employers to their advantage. They can as a pricing strategy apply the same discount to the employees compensation that other prospective employers would. What do you think about the idea about slightly overpaying for your high performance employees. This way when they go and look around they realise that they are valued.
- danieltillett 9y ago
  This is exactly what I suggested - overpay, but not by too much. If you pay too much more than they can earn elsewhere then they become effectively handcuffed to you and feel they can’t leave even if they want to because they can’t find an equivalent paying job elsewhere.

3 ms·

Why? It would only be bad if your effort was not recognised by me and compensated accordingly. This would be bad management. Your pay should be determined by w

by danieltillett 9y ago

dman 9y ago
There is a subtle issue that comes into play here a. High performance employee who works at employer A has already given ample evidence of going over and above usual metrics of efficiency. b. High performance employee decides to go into the market and shop around but other prospective employers have to largely take the employee on their word and their portfolio about their performance. Since these prospective employers have not yet witnessed the said over achievements, rationally speaking they would apply a slight discount. c. Given the above, the existing employer can use the information asymmetry wrt to other employers to their advantage. They can as a pricing strategy apply the same discount to the employees compensation that other prospective employers would. What do you think about the idea about slightly overpaying for your high performance employees. This way when they go and look around they realise that they are valued.
- danieltillett 9y ago
  This is exactly what I suggested - overpay, but not by too much. If you pay too much more than they can earn elsewhere then they become effectively handcuffed to you and feel they can’t leave even if they want to because they can’t find an equivalent paying job elsewhere.