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What I have found is that top talent will leave due to the lack of a pay differential between average and high performing talent. We all want our work to be rec

What I have found is that top talent will leave due to the lack of a pay differential between average and high performing talent. We all want our work to be recognized and paying everyone the same is a great way to get rid of the ambitious. If they pay in the top say 5% nationally that's less of a problem but if you are paying whatever glass door says the average is expect churn among high performers as they move to where that behavior is actively rewarded. Similarly such a policy probably encourages low performers to apply. This strikes me a managerial laziness, they aren't going to bother to put the effort in to decide who on their team should be rewarded.

matwood 7y ago
> This strikes me a managerial laziness It also avoids hard conversations. Now they do not have to tell Joe that he makes less than Suzy because Suzy is a better performer. But, maybe that's a good thing. Since we all lie to ourselves and think we are better than we are, Joe probably thinks he's killing it. And, since many people lose whatever maturity they have when talking about their performance vs. someone else particularly when there is money involved, that whole conversation can be skipped. The problem as you say though is what happens to Suzy. She will not be happy making the same as Joe since she will also think (and be correct) that she is a better performer. So either they only hire the same level performers (which is possible in a small company), or they start inventing job title/levels. At the end, it's trading one set of problems for another. I applaud them for trying out new ways to structure company wide compensation though.
bluedino 7y ago
I'm guessing low performers don't get hired or stay long. Either way, it's a good reason to not give two shits about what your co-worker makes.
onion2k 7y ago
What I have found is that top talent will leave due to the lack of a pay differential between average and high performing talent. I'm going to start coming across as a weird Basecamp fanboy/stalker soon, but on this particular point people don't seem to ever leave Basecamp. It's very rare for they to be hiring, which wouldn't be the case if they had a high level of staff turnover. What you've found is not applicable to them for some reason.

matwood 7y ago

> This strikes me a managerial laziness It also avoids hard conversations. Now they do not have to tell Joe that he makes less than Suzy because Suzy is a better performer. But, maybe that's a good thing. Since we all lie to ourselves and think we are better than we are, Joe probably thinks he's killing it. And, since many people lose whatever maturity they have when talking about their performance vs. someone else particularly when there is money involved, that whole conversation can be skipped. The problem as you say though is what happens to Suzy. She will not be happy making the same as Joe since she will also think (and be correct) that she is a better performer. So either they only hire the same level performers (which is possible in a small company), or they start inventing job title/levels. At the end, it's trading one set of problems for another. I applaud them for trying out new ways to structure company wide compensation though.

bluedino 7y ago

I'm guessing low performers don't get hired or stay long. Either way, it's a good reason to not give two shits about what your co-worker makes.

onion2k 7y ago

What I have found is that top talent will leave due to the lack of a pay differential between average and high performing talent. I'm going to start coming across as a weird Basecamp fanboy/stalker soon, but on this particular point people don't seem to ever leave Basecamp. It's very rare for they to be hiring, which wouldn't be the case if they had a high level of staff turnover. What you've found is not applicable to them for some reason.