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Balsamiq : Salary Policy
- latch 15y agoI've seen a handful of companies with remote employees adopt a different policy. Essentially, they pay you an average salary by hot-market standards and don't adjust downwards. So, if you live in an expensive city (SF, NY, TK, LO) you are paid a fair market wage in those cities. If you live in a cheaper area, than lucky you. Personally, I prefer this. Maybe because I tend to like smaller and less hip cities. But it keeps things simpler for the company, and it means that, as an employee, you have a pretty significant say in, what we can call, your net income.
- balsamiq 15y agoI don't think that's fair, not everyone can move easily (family etc).
- latch 15y agoI think in 99% of the cases you are mistaken "can" with "want". That aside, whatever way you pick isn't going to be fair to one of the two groups...at least my way 1 group gets an advantage out of it (and the other group doesn't, out of choice (the vaste majority of the time)). If an employee was to get rid of his/her car, would you reduce his/her salary by $~1200/month because it isn't fair that he/she nets more money than the people who can't live without 2 cars?
- corin_ 15y agoIf the job requires that they be in a particular location, paying them based on that is fair, and very common. For example national services in the UK do that (such as post office), because if you're a postman/nurse/whatever in one place, you can't chose to live anywhere. However if you don't care where they live, they should all be paid equally - a person living in Thailand doesn't deserve less money than a person living in NYC, and just because they don't need as much money, doesn't mean they don't deserve it.
- buff-a 15y agoHow do you deal with someone who says they live in Manhattan, but actually lives in Mumbai?
- JonWood 15y agoFire them for lying when they provided an address in their employment contract. Do you really want to employ someone who does that at all?
- leon_ 15y agoSo I'm about signing the contract. And I somehow know that when I write down Mumbai I will get $20k/yr and when I write down NYC I will get $100k/yr. Guess what I am going to do ... > Do you really want to employ someone who does that at all? Do you really want to work for someone discriminating based on location and not performance?
- latch 15y agoNo, you shouldn't go work for them, and people shouldn't hire you. The situation works to everyone's advantage.
- buff-a 15y agoSorry. I meant someone who has a legal residence in Manhattan, pays US taxes, US social, but actually spends 350 days of the year "vacationing" in Mumbai, Buenos Aires, etc? And by "legal residence" I mean paying $100 a month to a mate to collect my mail and occasionally crash on his couch. Believe me, the IRS will back me up when I claim to be a US resident, as will New York State, and they would penalize balsamiq if balsamiq tried to claim otherwise. So what matters? Is it the law? Or is it the spirit? Is it the quality of work or the location where the person was at the time they did the work? What if the Mumbai resident comes to a conference in SF. Do you pay them SF rates for that week? What if they come for a month? Six months? This may seem like I'm looking for (what we call in video games) an exploit. I am of course. But so is balsamiq. It wants to have lower salary costs. It could pay everyone the same, no matter where they live. But it knows that Mumbai residents can't up and move to SF. So it claims to be fair (if they moved we would pay them more!) but the reality is that it knows they cant. I'm not saying I have a better idea. But I'm not the one blogging about it.
- cageface 15y agoIt seems unfair to me that I might be paid less because I've opted to live in a cheaper area. Why should I have to subsidize my teammate's expensive, hip, urban NYC lifestyle if I've decided to live somewhere cheap and save money for early retirement, starting my own business, supporting a larger family etc?
- toyg 15y agoSorry, am I reading correctly? Peldi should subsidize you starting your own business? That seems unfair to me :) Aside from the clear moral judgement you're making here, which doesn't belong in any salary policy, the problem with your argument is that chances are that you made that choice while maintaining a "urban" salary... i.e. you are fundamentally exploiting a loophole in "classic" remuneration systems thanks to telecommuting, and you're now complaining that those systems might be catching up.
- cageface 15y agoIf I'm providing exactly the same quality and volume of work, why should my zip code matter? You're reading a moral argument in my comment that I'm not making. If anything this sets up a reverse incentive to live in NYC like a college student and pocket the difference. What you're calling a loophole is the new reality of information-based labor. Companies that penalize their employees for taking advantage of this flexibility to set their own lifestyle priorities are going to suffer in the market for top talent.
- toyg 15y ago"If anything this sets up a reverse incentive to live in NYC like a college student and pocket the difference." It's a choice; everyone makes lifestyle choices, like you say, as an employer there's nothing you can do about that. Peldi's policy gives you a chance to make enough money to live comfortably wherever you want to live; I think that's quite a perk, for most people. If your lifestyle choices completely trump your professional interest in joining the company, you'd probably not be a good match anyway. Besides, the policy is weighted by bonuses, and sounds more like the starting point for a conversation rather than a straight-jacket. Knowing the man a little -- we went to the same highschool, although he already was a celebrity and I wasn't ;) -- I'm quite confident he'd do his damnedest to find a satisfying and realistic agreement for anyone interested in joining.
- tomh- 15y agoSo how is this going to work? Pick the highest salary found in the area and add X, where X is a little? I never found the numbers from sites such as 'salary.com' or 'glassdoor' to be very reliable as it always 'depends'.
- balsamiq 15y agoIt is indeed a bit of a fuzzy process. We look at stuff together (ranges from salary.com, other similar job postings), then we agree on what's "a little better than the average". Maybe it means picking 3/4 point in the range...in general, I have found that people have a number in mind that would make them happy...it's a matter of finding it out and making sure it fits within the policy...it's easier to do than to explain. :) So far, those one-on-one where we decide the new level have been fairly easy meetings.
- jaryd 15y agoHas this resulted in anyone taking a pay cut yet? Does everyone know what everyone else gets paid (including management)?
- mbesto 15y agoJust read Dan Pink's Drive where this idea comes to fruition and it makes complete sense (especially in my own life). From Drive[1]: Instead of paying employees the wages that supply and demand would have predicted, they gave their workers a little more. It wasn't because they were stupid. It was because they were savvy. Paying great people a little more than the market demands, Akerlof and Yellen found, could attract better talent, reduce turnover and boost productivity and morale. Highly recommend reading Pink's book. [1] - http://www.amazon.com/Drive-Surprising-Truth-About-Motivates/dp/1594484805/ref=sr_1_1?s=books&ie=UTF8&qid=1315821748&sr=1-1 http://www.amazon.com/Drive-Surprising-Truth-About-Motivates...
- StavrosK 15y agoSo an employee that lives in X makes less than an employee who lives in Y for the same amount of work... I don't see how that's fair, since I would be getting paid $1000/mo by those standards. Conversely, I would get a raise of an order of magnitude if I wanted to up and move to, say, New York.
- deleted 15y ago[deleted]
- danmaz74 15y agoLook at it the other way around. If where X lives a decent home costs you $1,000/mo, and where Y lives the equivalent home costs $2,000/mo, how fair would it be to get the same wage?
- ekidd 15y agoA common trap: We want amazing programmers, and we pay them slightly better than average. I'm good at what I do, and I aim for more than "a little better than someone with your same job in your geographical area." Some of the most amazing consultants I know charge far above their local market average. And I'm always happy to write them checks, because they're amazing programmers, and they would be a steal at 5 times the typical market rate.
- tptacek 15y agoComparing consultant comp to full time salary is an apples/oranges comparison, as is the sort-of "second derivative" comparison of (a) how different consultants set their comp relative to each other and (b) how full time developers set their comp relative to each other. The mechanics by which a consultants comp are set are just wildly different from how full time salary is worked out.
- balsamiq 15y agoWith our formula, the job category to compare these people with would be "amazing consultants", not average consultant. In other words, these people are very senior. No?
- mseebach 15y agoAmazing people don't travel in homogeneous pools whose salaries can be averaged out meaningfully. Finding these people is hard enough, finding out what they would get offered down the street is harder yet.
- kamaal 15y agoWhat has being senior got to do with quality of work delivered? Sure experience counts for some thing. But measuring someone's worth by looking number of years on the resume seems to be a bad metric for hiring. I generally put in twice the effort as a my boss on almost daily basis, I expect to be what he is now in half the time he took to be. Why not just flatly pay them on the amount of work done, regardless where(location) they work.
- kingofspain 15y agoThe average wage where I live now is shockingly low - and that's after coming from a somewhat depressed former mill town. I moved here though because it's absolutely stunning and my life will be immeasurably better because of it (once I finish this damn never-ending contract and get some free time at least!). I'd hate to have to take a giant pay cut just for wanting to actually enjoy my life. If anything my productivity and quality of work has gone up. Pay me less for that and I'm off!
- zura 15y agoWhat about this situation: X and Y are places with similar cost of living, but people in X have lower wages and they are used to live cheaper (i.e. they buy less goodies, etc..) than in Y. In other words, maybe it would be better (more fair) to compare costs of living instead of average salaries?
- balsamiq 15y agoI think that's too subjective. We look at average local salaries as a way to see "what does the local market say this job is worth right now?" - basically deferring the range to what the market decides is fair.
- zura 15y agoOn the other hand, you seem to use cost of living comparison for profit sharing. Quote from: http://blogs.balsamiq.com/team/2011/09/12/profitsharing/ http://blogs.balsamiq.com/team/2011/09/12/profitsharing/ "9. then all weighed by the cost of living in each location: this is important because it's fair. The fact that we're using cost of living instead of average wages is even more fair (i.e. Italy has low wages relative to the cost of living)." The last sentence, regarding Italy, corresponds to the situation I described. So, if it is fair for profit sharing, then it also seems logical to treat it as fair for salaries as well.
- phamilton 15y agoCompetitive wages are incentive to not leave. Profit sharing is incentive to do good things. The former must be dependent upon local wages. The latter is able to incorporate fairness.
- zura 15y agoI wouldn't differentiate it regarding fairness. Salary + Profit == Compensation for the work done. Compensation should be fair.
- kamaal 15y agoI read this somewhere on HN a while back "Pay a man by the hour and he will put in as many hours as he can, Pay a man by the brick and he lay down as many bricks as he can". I would go on to add and say, If you a pay people flatly some will work, some won't and rest will do mediocre. The guide to get work done is to drive the rewards in that direction. I fail to understand what stops companies from paying people on the basis of work done, rather flatly or hours spent. Is it because it will set a dangerous precedent and that productive people will end up earning more than what you expect to pay? I refuse to believe that people are not motivated by money or that money is somehow not a major motivating factor. All passion, determination et al management talks is OK. But I'm not happy earning less than what I'm supposed to. Just because I could it doesn't mean I should. I do more than everybody else back at work, so I obviously I deserve more. The way salaries work is to get bulk of the work from a few. But then reward every body equally on a average basis. That to me seems like expecting a few to carry a burden of the whole lot. And has a strong stench of communism to it.
- whatusername 15y agoTo quote from the article: "This is the base salary. To participate in the company's profits, we also have a generous profit sharing program as well."
- wpietri 15y agoAt least with software, productivity is very hard to measure without introducing perverse incentives. This is especially true at small or innovative companies, where people must be flexible. Moreover, software is creative work, not brick-laying. There's a fair bit of evidence that incentive schemes harm that work. (See "Punished by Rewards" for details.) I code because I love it. If it didn't pay, I'd be like my actor/musician friends and get a day job. So I just want my salary to be livable and fair. I don't really care about maximizing it.
- kamaal 15y agoYes, Even I love to code. But just because true hearted altruistic people like you exist. It doesn't mean I must replicate the same. I'm motivated by many other factors apart from money. But just because that is the case, I feel no reason to settle down for less than what I deserve. And just like you mentioned I want my salary to be just fair. Just pay me for my work. That's all I'm asking. And is that a unjust demand?
- rscale 15y agoThis policy rubs me the wrong way, because I believe in value-based pricing. If I generate $1m of value for your company, I should be able to negotiate the capture of a reasonable chunk of that value. My decision to live in a high or low cost city doesn't change how much value I'm delivering, so it shouldn't have a meaningful effect on my price. Either I'm worth it, or I'm not.
- balsamiq 15y agoHi rscale, we have a profit sharing program in place as well. Also, if you're a super-senior person, that's who your base salary will be compared to. Also, you might get an extra performance-based bonus. Basically I consider the base salary to be just that...the base.
- marklittlewood 15y agoBalsamiq and profit sharing. Should be read alongside Balsamiq on salary policy. http://news.ycombinator.com/item?id=2986673 http://news.ycombinator.com/item?id=2986673
- scottjad 15y agoYour profit sharing program does not answer rscale's question, it compounds it, since you also reduce profit sharing by cost of living.
- biot 15y agoWhy not go further? Everyone submits their living expenses to the company including food, shelter, and so on. Limits are set on what is considered to be a reasonable expense. Above and beyond that, everyone gets the same base weekly stipend plus an additional 50% of the stipend, cost-of-living adjusted for their area. To further promote equality amongst employees, company robes can be distributed to everyone. Multiple employees living in the same city can move into the company commune to further enhance the brotherhood and keep everything fair.
- Murkin 15y agoEnjoy it while it lasts. Sure its cool and fun while there is a small 'startup-minded' team, racking in huge bonuses. But once you grow a bit, you will inevitably have employees take a look around and think: "Hey.. home come I am much better than these two guys around me, and we all make the same money ?" Socialism has been tried in many different forms and ways, sadly "equality between equals" is not a concept Humans are willing to accept too well.
- balsamiq 15y agoNot everyone makes the same money. If you're better, you will be compared with more senior jobs (and I mean senior as "more capable", not with more years worked).
- Murkin 15y agoSo you basically have two people sitting in the same room: a) 45 year old veteran, 3 years in the company, titled "Software engineer II" b) 25 year old grad, 1 year in the company, titled "Software engineer V" Sure its all open and nice, but don't you think (a) might be a bit.. disgruntled ?
- Silhouette 15y agoI'm not sure they would, actually. It's been my experience that there are several clearly recognisable personality types and work ethics in a typical software development team, with two groups in particular that always stand out. You can have people who come into work, do a decent job, and then go home and spend time with their kids and other things that really matter to them. The job isn't something they live for or feel deeply invested in, and they are unlikely to go "above and beyond" on a regular basis. They welcome training to develop their skills and will consider new working practices with a reasonably open mind if a good case is made, but it is up to the company to arrange and manage such things. However, the bottom line is that these people do competent work to a reasonable professional standard. In my experience, this is by far the largest category in most software companies. Then you have the geeks, the ones who love the work, spend a lot of their spare time programming as well just for fun, follow all the latest trends, and -- dare I say it -- often frequent forums like this one. It is in the nature of this group that they will learn and develop their skills faster both because they spend more hours programming themselves and because they are exposed to more diverse influences within a shorter period of time. These people won't be the ones waiting for the company to organise training, they'll be pushing to get the latest book or go to a useful conference, or they'll be giving the training themselves to share with their colleagues some new ideas that they've discovered elsewhere. The risk with the younger members of this group is always that they will go too far: while they can be many times more productive if properly guided, almost all architecture astronauts, latest-shiny-development-process evangelists, and similar poisonous influences fall into this category as well. The risk with older members of the group is that their priorities in life may change, often as they have growing family commitments, so even if the desire is still there, the time to keep up as much as they used to may not be. You can usually recognise the ones who manage it, because they'll be the ones who somehow manage to help half a dozen different colleagues to solve some non-trivial problem each day, even though they still get their own work done faster than most anyway. In my experience, everyone in the office knows which of these (or other) categories everyone else falls into within a few weeks of working with them. The former group don't tend to begrudge the effective keen ones the faster career advancement and more rapid pay rises they tend to achieve, because they recognise the difference in approach. On the other hand, they also have little time for the keen-but-poisonous ones, and become mighty upset when someone who thinks they're all that but isn't really generating the results to back it up is being mistaken by management for one of their more productive brethren and rewarded disproportionately. In short, there are different types of people and they know who each other are. As long as reward and career advancement are based on genuine merit, I don't think most older "journeyman" professionals do begrudge the young high-fliers their faster progression. (Edit: As an aside, I assumed your examples were exaggerations. I have never met the 25 year old, my egotistical self included, that was worth a senior job in a larger development group, even if they thought they were at the time.)
- jaryd 15y agoBalsamiq, How does the open salary policy work? Are salaries posted on a big white-board? Does the open salary policy have an effect on employee behavior? In many cases people are reticent and fearful to talk about/compare their compensation. People tend to attribute their personal self-worth to their number and consequently hold on to it pretty tight. How did you guys get over this particular hurdle?
- balsamiq 15y agoThey are in a spreadsheet in a shared drive, along with all the rest of the stuff. What I have found is that because of our base salary policy, people don't really care about the hard numbers...they know that they are paid well and that their colleagues are paid well...at least that's from what I can see. One employee told me that they'll not look at the numbers because it makes them uncomfortable, and that's fine with me too.
- jaryd 15y agoAh -- so it's just the base salary in that spreadsheet? Why not share total compensation as well (including bonuses)?
- balsamiq 15y agoThat stuff is there too (in the monthly expenses).
- erlendfh 15y agoReally cool to see a company implement such open policies! Have you by any chance read Maverick or The seven day weekend by Ricardo Semler? Lots of similar ideas in there, and well worth the read! http://www.amazon.com/Ricardo-Semler/e/B000APW260/ http://www.amazon.com/Ricardo-Semler/e/B000APW260/
- jaryd 15y agoThat's so awesome! How did you guys come up with this idea? Did it meet any resistance initially?
- wpietri 15y agoI think this policy could use something about fairness, too. Some great programmers don't care much about money and hate negotiating. You want to be sure they get paid as well as somebody who is as good but is greedier or more aggressive.
- cageface 15y agoI didn't care much about money when I was younger. Now that I appreciate more how brutal this field is for older programmers and what it means to be older and less employable in a bad economy I'm much more aware of my running bank balance. I'm also more aware that I have a finite amount of mental energy for coding every day and if I'm selling it instead of building my own things I'm not willing to do it cheap.
- marklittlewood 15y agoGreat post Peldi. Before people get too bogged down in just the salary piece of this puzzle, you should also read Peldi's comments on bonus: http://news.ycombinator.com/item?id=2986673 http://news.ycombinator.com/item?id=2986673 Balsamiq is a fairly unusual business and Peldi has grown something pretty extraordinary. This is a highly profitable business that has made a conscious decision to be great on its own terms, not on the terms that a Silicon Valley venture capital firm might impose on the business. If you want some more background, go and watch this video of the talk Peldi gave at Business of Software last year. There is also a transcript you can speed read if you don't have an hour to spare. http://blog.businessofsoftware.org/2011/08/do-worry-be-happy-peldis-brilliant-talk-about-keeping-sane-as-a-software-ceo-video-transcript.html http://blog.businessofsoftware.org/2011/08/do-worry-be-happy...
- dmoney 15y agoHow do you do the profit sharing? Does everybody get the same percentage, or is it based on how "senior" they are?
- balsamiq 15y agohttp://blogs.balsamiq.com/team/2011/09/12/profitsharing/ http://blogs.balsamiq.com/team/2011/09/12/profitsharing/
- flexd 15y agoThat is sort of a odd policy. I get the impression everyone works remotely from wherever they live (but I might be mistaken). For someone with a computer science background the salary here is like 80k - 100k USD. I don't know what people average in the US but it's certainly not the same across the globe. For bigger companies I can understand this might not be such a problem but for smaller ones the salary difference would make up a lot of money. But I guess they stick to having people work remotely from within the US?
- vacri 15y agoI'm curious as to how this policy affects someone like me - the jack of all trades. I'm the guy who comes into a place wearing one hat, and for better or worse, ends up wearing four or more different hats in sometimes quite diverse positions. It's hard to figure out what salary I "should" get on the market because my position doesn't exist on the market.
- jaryd 15y agoCould you identify people in your industry that perform a similar job to you? If you could select the comparison pool than I would think it would be more accurate/useful than, say, an aggregate based on simply job title.
- three14 15y agoI'm in a similar situation, and I can't. I sometimes do IT for a small Windows network and for Linux and the VPN that connects everyone to both. I program in C#, perl, Java, shell, and XSLT depending on which part of my job I'm doing, and some of my job is "software architecture" which other people actually program. My industry is a tiny niche, and generally hires programmers from outside it and trains them, so salaries aren't a function of the industry. How would I find a good comparison?
- encoderer 15y agoAnybody in the United States may be interested to know that they are permitted by federal law to discuss their salaries with their co-workers. The NLRB is known primarily as the board that governs unions and union organizing. Well, for many years they've considered employees discussing salary info as protected organizing activity. Any employee that experiences adverse action by an employer after discussing salary with a coworker should contact the NLRB. They will pursue the issue on the employees behalf. This advice comes from my lawyer, but you should consult your own before you do anything. Also, my 0.02 is that as an employee, I feel I'm often at the higher or top end of my employers range, and despite the fact that I legally COULD, I don't really see any value in discussing my pay with a coworker.
- asmosoinio 15y ago> Also, my 0.02 is that as an employee, I feel I'm often at the higher or top end of my employers range That's what you think, and that's why your employer also likes you to keep your mouth shut. Or? (After all, more than 50% of people are above average drivers, or whatever the exact anecdote is...)
- encoderer 15y agoWhile I appreciate your concern for my general welfare, you can see some write-ups about my negotiation experience in my comment history, and in a few instances where I've been privy to department payroll information, I've been at or near the top.
- copper 15y ago> I feel I'm often at the higher or top end of my employers range, and despite the fact that I legally COULD, I don't really see any value in discussing my pay with a coworker. Back in the day, I used to work for this place where, you've guessed it, according to the people who did my salary reviews, I was always close to the top end of my employers range. So, yeah, you can imagine how that worked out :) While it's always possible to get a general impression of what a coworker earns (always assuming it's possible, or legal), it's no substitute for numbers.
- leon_ 15y agoIn a world of tele commuting it's pretty backward to base salaries on locations. If someone is great pay him what he is worth to you and not what he would get if he decided to go and work at the local cubicle farm. I'm hoping for a future where you get paid what you are worth and can travel around the world working from wherever you want. A boss that says "Yeah, the beaches there are wonderful and people earn $5/month. So your new salary is $6" is a deal breaker in that dream ;)
- jamii 15y ago> I'm hoping for a future where you get paid what you are worth and can travel around the world working from wherever you want. If you're a competent programmer, you're already living in that future. Remote work is pretty easy to get these days, especially if you freelance and do either web dev or iOS/android. I don't do either and I've still managed to live on three continents in the last year or so.
- scottjad 15y agoUsing location based salary comparison sites is broken if the job is for remote not onsite work. If hackers in NYC are paid $150k, and Philly $80k, neither of those numbers matter. What you want is the going rate for remote-working English speaking US citizens in eastern time zone close to a major airport with the given skill set. What this company is doing is like deciding how much to pay an employee based on whether or not they have a pool and tennis courts in their backyard, rather than based on supply and demand. Note: Location still matters, which is why I mention timezone because depending on business, location/timezone of existing employees, and where HQ is located it may change the demand. Also since most remote workers travel to gettogethers occasionally I mentioned airport.
- edw519 15y agoeveryone knows how much everyone else makes This may work well when things are going well, but as soon as there are internal "issues", it is a recipe for disaster. "Joe earns 25% more than me, but doesn't show up until 10:00, so why should I bust my ass coming in earlier." "For what she earns, Shirley should be providing way better specs than this." "Cut me a break. I spent 3 weeks overtime getting that thing done, and Fred gets all the credit (and money!)" "I'm way better than Jim. Pay me as much or I quit." "Jerry must have something on the boss to be paid that much for doing so little." I could go on and on, but you get the idea... Team building is tough enough. Making compensation public adds another layer of complexity. Now every internal concern is made more difficult because the dollars come into play. There is no argument or discussion where salary is off limits. Before long, that's what everyone will be thinking about when you really want them thinking about anything else.
- Duff 15y agoPeople get over it. I work for a public sector employer. My salary is fully searchable and posted on the local newspaper's website. Unless your company is doing dumb things like discriminating against certain types of people, there aren't many surprises to be had. Frankly, working with a useless coworker is frustrating regardless of salary.
- eli 15y agoYeah, but your employer probably has a pretty well defined process for setting salaries and giving raises, right? Perhaps it isn't a fair process, but at least consistent. Private companies aren't always like that.
- Duff 15y agoExactly -- inequity is the issue, not disclosure. It's a bigger issue for the employer -- it doesn't take a rocket scientist to figure out that certain people are buying new cars at bonus time, while others cannot afford lunch.
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- toyg 15y agoI'm amazed at some of the replies here. "He'd pay a better-than-average base salary -- THAT'S NOT ENOUGH!" Guess what? Outside the Valley bubble, more often than not it IS quite enough.
- usedtolurk 15y agoHeheheh... all these comments just go to show that no one policy can be fair for everyone. :) Balsamiq have a policy that aims at fairness, is transparent (and yet open for discussion!) and has a better-than-average chance of appealing to their target audience - people who aren't driven by money but don't want to be taken advantage of. If you can't find a compromise that works for your situation - go work somewhere else.
- ylem 15y agoI think the problem is what happens with time. Imagine that you have a graduate in a time when the economy is doing poorly. There will be lots of people out of work and competing for jobs, so salaries (in general) should be less generous. Later, if the market picks up, then that year's crop of hires will have higher salaries. Fast forward a few years. Assuming that the difference in skill levels is negligible, salary differences could still be significant. Now, imagine that salaries become public...
- benaston 15y agoThis is all bullshit. Each company pays what is profitable for its business model. Work in a hedge fund? Your pay is commensurate with the business model. Work in a digital agency, likewise. As far as I can tell a digital agency is a digital agency, is a digital agency. They all work the same market with the same overheads. It doesn't matter that the dev in the hedge fund is doing precisely the same job (in my hypothetical scenario). "You are paid a little better than someone with your same job in your geographical area." Of course you are, otherwise your employer wouldn't be in business. The operative word being "little". Substitute "a lot" and either they have a disruptive business model and are willing to pass on the cream to their employees (unlikely), or they are going out of business. Give me any dev in any city in my country and I will be able to tell you what they are on based on their seniority and sector plus or minus a few grand (and what's a few grand after higher-rate tax?). Tldr - this policy is moot because salaries are open secrets. FWIW, if you want to earn more go into contracting (i.e. take on more personal risk), move sector (i.e. go into finance), start your own company, or move into a more traditional profession.