20 ms·

Rethinking Levels, Promotions and Salaries

130 points by vr000m 5y ago

m4l3x 5y ago
I am not sure if this kind of transparency will be beneficial to the employees or not. Like the article mentioning there is leverage missing for salary negotiation. That mean, that some folks would earn less assuming the model was adapted everywhere. However it may clean up inequalities. In the end people are divers. There are hires with only 2 years delivering better results, than one with 5 years.
- someelephant 5y ago
  you got to appreciate that honesty about leverage. this whole program was designed because they weren't competitive in the market.
nicoburns 5y ago
This seems broadly sensible. Only counting experience after schooling ends won't work for everyone though. I was employed full time as a software developer before I went to university. And I had 5 years of non-commercial experience before that while I was still in high school that most people won't have. Presumably there's some wiggle room for managers to use their judgement on what counts as experience, so it probably works out.
- KevinEldon 5y ago
  You would negotiate how that experience is recognized in the hiring process.
david_allison 5y ago
> We start counting years after formal schooling (high school or college). Grad school often counts as indirect experience. As someone who worked in software development during High School, and took time off before University to work in software, this somewhat frustrates me. Alyssa Rosenzweig has 0 years of experience under this model.
- justinlloyd 5y ago
  Me too. I never left school. I shipped my first commercial product in 1978 at the age of 11, launched my first company at age 14, and sold my first company at age 19. Here I am 44 years later with zero years of experience because I keep adding more years of college and university. I am not exactly the brightest crayon in the box, but I found college "easy" because I had years of professional discipline meeting deadlines. This idea of counting experience only after you left college is absolute nonsense. And too add, I never actually graduated from the UK equivalent of high school, which drives HR people nuts, especially when they find out that the CTO of the company they are acquiring is a high school dropout.
  - KevinEldon 5y ago
    May you continue to work until you no longer want to, create on your own terms, and drive as many HR people nuts as possible!
    - justinlloyd 5y ago
      I have never worked a day in my life. I get paid generous amounts of money to play.
  - codechad 5y ago
- Xcelerate 5y ago
  Yeah, I was a bit frustrated with this as well. I was somewhat down-leveled right after finishing my PhD because a lot of employers didn't consider it experience, even though I did high performance computing work with projects that had multiple stakeholders. Honestly, I was more technically savvy then than I am now 4 years into working at a large tech company.
  - marcinzm 5y ago
    >Honestly, I was more technically savvy then than I am now 4 years into working at a large tech company. The usual reason I see for down leveling is because being technically savvy is not what companies actually look for. I'm talking most jobs rather than being in an R&D division that is PhD heavy. * Understanding the modern SDLC in a corporate environment and best practices. Academia often doesn't do things in a way that would be considered good production practices outside of it. Both from a process and a technical (CICD, heavy testing, layered frameworks, etc.) point of view. * The culture of academia differs from corporate which means that while you gain soft skills they are biased versus what you'd get in a corporate environment. That can have subtle or not so subtle impact on decision making.
yawgmoth 5y ago
Living in the Midwest and currently working remotely for a NY based company. Remote / coastal salaries are so much higher than typical Midwest engineering salaries that I'll never be able to return to the office again. This feels like a problem worth examining, but what can be done?
- JackMorgan 5y ago
  For possibly the first time in human history we workers are able to get the benefits of geographic arbitrage and still command some of the highest salaries in the world. I really like that and appreciate it. However, if the dual benefits of going into an office and living in the Midwest are important enough for you, that office will cost you a lot in missed opportunity costs. I don't know if that's a problem that can be solved, or just a natural law of constraints.
- cebert 5y ago
  I live in the Detroit area, and also noticed a huge salary discrepancy between local salaries and those for remote positions. The positive is there are many great opportunities for us to increase our income while living in a lower-cost area than Seattle, NYC, SanFran, etc. Midwest based firms need to reconsider their pay bands, or they’re going to have problems competing for talent.
  - humanrebar 5y ago
    Midwest salaries have been low for a long time, and it has had an effect on the ability to attract and retain top talent. The difference now is that the market for employment for engineers unwilling to relocate to those coastal cities has expanded dramatically. The new entrants are coming in with market-clearing salary offers. I predict we'll see salary expectations in the Midwest increase dramatically. Some Midwest employers will have to adjust their business plans accordingly. For instance, consulting shops may have to increase pricing quite a bit.
- deleted 5y ago
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- 5y ago
KevinEldon 5y ago
"If everyone can get promoted simply by sticking around, managers have to be active in communicating with people who aren’t meeting expectations and helping them improve. Managers also have to be willing to let people go if they don’t show progress."
twobitshifter 5y ago
The company I’m with now makes promotions without salary increases. The salary increase comes in the next review cycle when you’ve proven that you can do the job. It seems very unusual to me, has anyone else seen this?
- LandR 5y ago
  So you get promoted, then have to do that job at a lower salary than the position should get you. Once you get the raise at the review cycle, is this also back paid for the time you were under paid for the role ?
  - taneq 5y ago
    Pretty cunning, I bet whoever thought that one up got a raise (in the next review cycle).
  - ant6n 5y ago
    At my place (not software), they ask me to perform the job at the next level, in order to prove that I can do it, before promoting me. They also require that at least 2 years are spent at each level. And during Corona they didn't promote anybody, meaning everybody`s career slid back by up to an extra year, depending on where u were in the cycle. I would've much preferred if they had promoted ppl and done salary increases later.
  - sokoloff 5y ago
    With overlapping bands, it’s not necessarily the case that you were being underpaid (in a cosmic fairness sense). If you are a level N Foo and doing well (as determined by doing some amount of level N+1 work), you might be earning the top of the level N Foo band. If that’s above the bottom of the N+1 band, you might be making the same as or more than the most recent N+1 hire. The day the company decides that your level “rounds” from N to N+1, you might already be being paid the exact correct amount. Design of pay scales and how they interact with promotion thresholds is complex enough that many fair systems can evolve. Most systems have evolved to slightly underpay the “almost N+1” employees for a period of time, leading to the expectation that promotion come with an immediate salary bump (and often companies do that to make the promotions “feel bigger”), so maybe the problem is promotions under that system should come with back pay rather than the situation described here being the one where back pay is owed.
jen20 5y ago
From the article: > Direct experience in our rubric means substantially the same kind of work (coding, design, product management, etc.) This is a recipe for finding people without "n" years of experience, but instead finding people with one year of experience repeated "n" times. Great if you need a specialist in something, tragic if you need generalists - which most startups do.
- justinlloyd 5y ago
  Having founded and worked at quite a few start-ups, start-ups should aim for one specialist for every half-dozen generalists, preferably even lower than that. It's not a hard and fast rule, and pretty flexible, but if you have a single generalist and lots of specialists in a start-up, you are in trouble.
someelephant 5y ago
promotions are such an absurd idea in this job market
- lscdlscd 5y ago
parkingrift 5y ago
Strong disagree with basing salary on years of experience. I see almost no correlation between output, skill, and years of experience. I actually consider this an anti-pattern that actively encourages coasting.
- ct0 5y ago
  Experience is relative here. While I agree, there should be an adjustment that captures something like "years of performance", but its harder to quantify.
- sokoloff 5y ago
  I think there’s a large correlation in the 0-3 years window. I agree there’s almost none in the 12-15 years window.
  - cindarin 5y ago
    Amusingly to me, I think the opposite.
    - sokoloff 5y ago
      That’s fascinating to me. I’d love to chat more deeply about that, but I can’t see a way to get at the essence of the difference in an HN thread.
      - pc86 5y ago
        I tend toward your side of things. In your first 0-n years of experience, you're growing extremely quickly (hopefully). You're working with a lot of new tech, new people, if n is greater than 4 or 5, hopefully at least two companies if not three. But by the time you have n-teen years of experience, it's much more like you've been repeating the same year of experience over and over again. Growth, especially if you have a decade of experience (and not one year ten times), is hard. I think especially at the upper end it takes dedicated effort.
KevinEldon 5y ago
This seems like a reasonable strategy worth if you plan to exit in the next 3 years. It is simple to manage, is designed to be competitive for a point in time, and focuses on performance for growth (up or out).
- sokoloff 5y ago
  I think simple to manage and “people who don’t like it won’t bother us about promotions” is high here. Whether that makes it worth losing out on corner cases where you’d benefit from a more individualized approach isn’t as clear to me, but there’s a lot of benefit from elimination of all promotion discussions, referring all of those to “check the calendar; if we haven’t fired you by X, you’ll be level Y on that day.”
kybernetikos 5y ago
I like the transparency and fairness. I dislike that it rewards time rather than merit and will likely discourage people from developing expertise away from their core skillset as there could be an argument that their experience in that area isn't relevant, or that their relevant experience in this area is so small.
deleted 5y ago
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btucker 5y ago
I appreciate the intent here of making levels more transparent & evenly applied, but in practice this seems to be tying levels/comp to a demographic attribute people have no control over: their age. This makes me feel uncomfortable.
lmilcin 5y ago
Salary based on your "experience" as measured by the number of years you survived sitting by the computer. This is absolutely, fucking dumbest idea I ever heard. Say you have two engineers that both have 10 years of experience, one is barely scraping by and one is working his ass off and significant contributor to the team. They earn the same money and, more importantly, they both know it. And the team knows it. And the manager knows it. Can you guess which one will feel treated unfairly and will start looking for a new job? Imagine a good employee comes to you and says she is going to leave because she has been offered better salary somewhere else. You have now only two choices: 1) break the commitment you made to entire company, 2) let her go. You can also decide to promote her, but management is really a different job and you lost your team member anyway. Over time your business will accumulate people who just barely passed your recruitment process and are just barely competent to avoid being let go. If you think you will keep the better one just because you say some nice words and give them recognition token, guess again. Let me explain what this means: it promotes people who sit idly by the computer (because they gain regardless of their involvement) and punishes people who actually give a shit and who try hard being better every day. It punishes your business HARD. In most businesses, most progress is being done by small minority of employees. And now you are leaving gates open and saying you are not going to even try to keep them doing good job.
- verve_rat 5y ago
  It's the dead sea effect. All the good people evaporate leaving only the salt.
- mnsc 5y ago
  > Ambitious people like achieving goals. Like coming in, making the biggest impact they can eg. do a large spectacular redesign, leave for 10% pay jump immediately and never sticking around for that maintenance nightmare that were hidden in the details? Incentives will always be a tradeoff because you can't measure skill.
  - lmilcin 5y ago
    > Incentives will always be a tradeoff because you can't measure skill. Oh, so because it is hard let's just stop trying? You can't measure skill accurately. But you can try to find correlations and you can measure other things that are as much or even more important like... erm... results?
jawns 5y ago
My career path was 10 years in journalism, during which I was also programming as part of my responsibilities, and now 11 years in full-time software development. Under Daily's levels system, I'd have 11 years of "direct" experience and 5 years of "indirect" experience, for a total of 16 years of experience, putting me in their highest band (Level 7) with a salary of $270K. But as I've told every employer who's hired me since leaving journalism, and particularly as I've transitioned from an IC to a manager, those years of experience in journalism were invaluable. I learned how to ask the right questions; how to handle the stress of always being on deadline; how to be a generalist, quickly learning enough about a subject that you can clearly explain it to others; how to communicate effectively in general; and many other skills that are absolutely relevant today. Obviously, it wouldn't matter for this banding whether those years are treated as "indirect" or "direct" experience -- I'd be in Level 7 either way -- but I could see it matter for others. Full disclosure: I applied to Daily last year but they ended up filling the position with an internal candidate.
- sockpuppet69 5y ago
- Mezzie 5y ago
  Yes, the years of experience metric greatly underestimates the value brought by rare synergies. I'm a decent programmer/developer, but that isn't my primary worth to a company. My primary worth to a company is that I'm a competent developer with additional specializations in both high-level research and media relations/communications.
thenerdhead 5y ago
There’s a huge loyalty tax being paid here. Although the transparency is nice to have, it’s simply not a sustainable model. People grow at all sorts of rates professionally. Some people can grow from a formal level to another in a year as they get a hang for their responsibilities/job. Some people have extremely hard years due to external factors too. This type of system incentivizes nobody. Why work hard? Why do challenging stuff? Why take on the jobs with most responsibilities? Etc > In the coming months, we aim to develop written guidance on what career growth looks like for different roles, and we'll start experimenting with rewards and recognition other than salary for particularly noteworthy achievements. How do you reward or give recognition if your system isn’t fully thought through or based on the traditional methods of perceived impact and notable accomplishment? Isn’t that exactly what this would be anyway? Honestly this sounds like a startup who just landed recent funding thinks they are “disrupting” the market with new unconventional TC methods. Not everyone is the same. One person with ten years of experience is another persons four years. What fairness is to me is understanding where you sit relative to your peers and market. It is checks and balances of your worth and not political players reaping the rewards constantly. It’s the whole idea that there’s three types of workers: experts, operators, and politicians. The former two actually do the work, the latter just takes the credit more visibly.
- pfortuny 5y ago
  This is topical but your comment reminded me of Deming’s New Economics. Rewards in a system with intrinsic variance are harmful and unjust.
  - thenerdhead 5y ago
    Yep, everyone needs to work together so everyone can win.
benreesman 5y ago
This is sort of well-articulated and someone thought about it a lot. The salaries seem fine, as long as there’s 1MM in liquid equity to go with the L7 one like Google does. But it doesn’t seem to address the real issue (to which I also don’t have a final answer): the jock/nerd thing is still playing out. If, as I believe is mostly true, A16 is pretty on the money with the software eats the world thing: hackers “should” today and inevitably will be the highest paid people possibly excepting the best salesperson. If you worked successfully on an optimizing compiler all day, anything that an MBA teaches is borderline boring. COVID/WFH only turbocharges this: tall white guys have way less edge over Zoom. It’s going to be a painful, but ultimately necessary transition where everyone whose math stopped at calc has their TC stop at 150-200k, and that money/seniority/prestige goes to the only truly irreplaceable people, again with the notable exception of the sales guy.
- cindarin 5y ago
  You may be right about many things you said, but this comes off as though you've got a complex about something.
  - benreesman 5y ago
    I’ll extend you the benefit of the doubt and assume your intention is to be helpful. Can you be a little more specific and thus potentially actionable?
    - cindarin 5y ago
      Unfortunately, I have neither the proper information nor interest to dig into that specifically. My best recommendation is to look into why I might have said that, and decide if you care at all what I thought. If so, take actions to change what things that you have a desire to change.
      - benreesman 5y ago
        Maybe keep it to yourself if the game plan is to half-ass psychoanalyze someone and then bail when asked a follow up question?
humanrebar 5y ago
> Not being able to pay enough for great candidates is a common problem for startups, and we’ve already had to accept that some very strong potential teammates won’t even consider us, given enormous salaries at established tech companies. But by doing the legwork to make sure we’re competitive within our cohort, we believe we’ll have enough great candidates who want to work at a company of our stage and size. Recruiters and managers out there: I read "competitive" compensation as somewhere around median compensation. That will be attractive to undercompensated employees and employees in their early careers. It's hard to get good candidates to leave current roles without some sort of pay bump (20%, say?) unless there's some sort of serious dysfunction or mismatch with their current employers. Daily's plan is to shoot for median-ish compensation and get "enough great candidates" to reach the next phase of growth. I'm glad they're planning on revisiting in a year or so, though it's easy to kid yourself. Especially when you're taking what current employees are willing to tell you as proof positive. For one, selection bias is certainly happening. Also, in my experience, people tell you what you want to hear. Daily employees that are significantly unhappy with compensation are a bad fit for Daily now given the blanket compensation policy. The best way to address that is to discretely look for other offers.
- sockpuppet69 5y ago
angarg12 5y ago
I worked for a very old fashioned company in Germany that used a similar system to pay employees. After about a year I became the lead of my team. But since some of my colleagues had been in the company about 10 years, they were getting paid more than me. Frustrated, I left for a better (and better paying) job. I believe these systems produce a "dead sea effect". High performer will leave, being able to get better deals elsewhere. Low performers will stay, since they can' find a better deal elsewhere.
- woadwarrior01 5y ago
  Interesting! I didn't know this phenomenon had a name. I've seen the "dead sea effect" at a well known SV bigtech co as well. And this company has biannual performance review rituals.
  - oblio 5y ago
    http://brucefwebster.com/2008/04/11/the-wetware-crisis-the-dead-sea-effect/ http://brucefwebster.com/2008/04/11/the-wetware-crisis-the-d... The blog has a bunch of other good article on related topics.
- humanrebar 5y ago
  If you felt you were underpaid, leaving is fair. I don't really understand the requirement that all bosses are paid more than those they supervise, though. I mean, emotionally I can understand feeling that way. But I don't think it's a rule of nature or something. For instance, coaches often make less than their star players. Directors and producers often make less than star actors. Hospital directors seem to make less than surgeons.
  - soco 5y ago
    Here in Switzerland, most of the non-IT people I'm talking with are genuinely surprised that for instance project managers are paid less that developers. For them just hearing the word "manager" = big buck.
mepiethree 5y ago
I’ve worked with plenty of people with “bad experience”. People who don’t learn from their mistakes, and consistently repeat the same errors, even things as basic as not testing their code before creating PRs. I guess this model works if you identify and fire those people early, but in general, this seems like a great way to retain proven career underperformers.
FL33TW00D 5y ago
YOE has little correlation with performance.
micromacrofoot 5y ago
holy shit are people with 5 years experience really making 200k!?
SloopJon 5y ago
My company has four IC titles, the description of which includes typical experience, with credit for graduate degrees. When we went from two titles to four, I was assigned the highest title, and joked that it was another way of saying "old". I would be level 7 under Daily's system, making more than I do now, but then what's my monetary incentive to improve? Younger, less experienced colleagues can literally set a countdown timer to their next promotion/raise. It feels a bit lazy, to be honest. Some people have commented that it will lead to coasting. The alternative that I anticipate is up or out: you're a level 5 performer at a level 7 salary. You might be happy at a level 5.5 salary, but sorry, you're out.
- Cthulhu_ 5y ago
  It makes me think of Amazon's PIP system, where managers HAVE to get rid of the lower 20% of performance - whichever performance metric that is. When applied to this, it kinda means - assuming it's x years at the same company / using the same system - you don't get paid more for having X years of experience, but surviving X years of performance review firings. It's X years of not being in the worst 20%. I mean if using that system I'd probably set the bar higher, but thankfully I'm not.
gwbas1c 5y ago
I suspect that, for most locales, they're beating the market. There's a good chance I'd count for 15+ years of experience, and thus they'd pay me much more than my local market normally pays me. On the other hand, I had a company with a similar salary structure approach me. They were based in a distant country with a much lower cost of living. I pointed out that their salary was about half of what I normally earn. They didn't "get" it that they were out of their game trying to recruit me.
smrtinsert 5y ago
Numbers wise looks good to me. Amazons recent base cap has thrown recruiters sideways and numbers instantly jumped in reach out emails. Turns out yes, compensation should be increase for hard to find skills that people use to create huge revenue. Shocked.
robertlagrant 5y ago
This is quite interesting, and I'm curious to see how it goes. I do think the definition of "fairness" is off, though: > Because using years of relevant experience is transparent and repeatable, both for leveling and promotions, it carries a strong measure of fairness Or more precisely, there are lots of ways to define "fair". And in this case fair is defined as "more years in post means more money, whatever your job is". This is not general fairness (perhaps nothing is) but it rewards loyalty. Other types of fairness (which actually their sales teams get) is "create more value, get paid more". I.e. kicking back for 10 years in a role that's fairly straightforward and hard to measure might reward someone as much as working incredibly hard and transforming the business for 10 years. That could well be considered unfair. I think rather than "fair" it's just "easy to measure", which accounts for the lack of need for promotion recommendations. I've never known them take very long, but yes, a length of tenure calculation will always be quicker. I would say also that I am curious as to how competitive this can possibly be for attracting talent. Desirable employees who need incentive to move to a company will generally get more money, as otherwise they won't move. Additionally retention might be an issue, as the same principles apply; market forces will mean that other companies that pay according to what an employee will agree to work for will have extra cash to wave at daily.co employees. Finally, I suppose that in the short term, powered by VC money, this is likely to work, and it's as good a way to spend VC money as any. I don't think we should call it a revolutionary way of working, as having a pit of money to prop up an idea does not make the idea sustainable for other companies. It might remain automatically workable for years to come if the company raises more money without having to survive on its own merits.
giantg2 5y ago
Wow, just aging into a promotion? This seems very attractive as a worker. But even I can see this could be problematic and not align to value production.
bl4ckm0r3 5y ago
It really feels like the objective for growth is just to wait, and not based on actual skills. Not sure if this is a good metric tbh, years of experience have a lot to do with type of challenges, and type of challenges have a lot to do with environment and architectures. you can be working 10 years on a small flower shop or building a huge distributed system that can handle crazy traffic or have really complex business logic. The worst thing to me is that it encourages engineers to focus on less risky challenges since the complexity of the work does not contribute to experience.
thebackup 5y ago
It’s interesting to see these salary levels. A senior developer (10+ years of experience) here in Sweden is paid less than their entry level salary. The difference in pay between Europe and the US seems huge. I wonder why.
- flibblercorn 5y ago
  Yes that is something that comes up on hackernews a lot, and I personally still struggle to accept it. According to the Daily level system I should be in their band 5, so $210K, but in England I am paid less than half their entry level salary (at current exchange rates). Americans don't have IQ scores, or any other metric to suggest being approximately 4-8 times the quality of other developed countries workers, so it's hard to just take it and accept that their compensation isn't due to their ability (on average), and that life isn't fair.
  - jandrewrogers 5y ago
    I am an American who has worked in Europe for many years at multiple companies, so I feel at least somewhat qualified to give some insight. Europeans are just as talented technically as Americans, that has never been the issue. As a broad generalization, European business culture is consistently poor at leveraging that talent to generate value, often treating it like factory work. Because American business culture is so efficient and effective at converting engineering talent into revenue, often on the scale of $1M revenue per engineer, they can easily afford to pay the higher wages while still making a fine profit. This has the side effect of making the market for engineering talent extremely competitive. In short, European technical talent as a resource is often being wasted by poor business practices, which means there is much less money to go around. There is no reason in principle that European engineers could not earn much more in Europe but changing business culture is slow, though some companies are trying.
    - thebackup 5y ago
      Thanks for this comment. A very interesting observation. Do you have any thoughts regarding American companies that are established in Europe, shouldn't they be able to introduce that American culture in their European offices?
mindvirus 5y ago
On one hand, this is pretty nice. I've always hated the career management aspect of working in the software industry, and so to have it so transparent and approachable makes a ton of sense so you can focus on doing work. However, my big question is how expectations and performance management scale with level? If someone's not there yet, but hits the years of experience for the next level, are they fired? Likewise, whose responsibility is it for people to get those skills by the time they age into the next promotion? Quick edit: Also wanted to call out how well written this post is. It lays out the facts, peoples objections, unknowns, and anticipates questions (salespeople remain on variable comp, equity isn't being addressed yet). So kudos to the author for the great writing on this thoughtful piece.
kodah 5y ago
While I like this promotion system, I think it lacks something like what the military calls "billets". If I'm a principal engineer and I lead two teams of engineers to deliver projects then I should be compensated for my knowledge as a principal engineer, then I should be compensated for the magnitude of responsibility of being a team lead. They are, in fact, two separate things.
rileymat2 5y ago
One thing I have always wondered about is if seniority based compensation can promote training without fear of replacement, actually improving the team over the longer term.
flashgordon 5y ago
So couple of things that stood out for me here: * Constant pay hikes per level (~30k every 2-3 years) * Any equity guidelines for level (especially since it is a startup) - I assume this is not a 9-5 job given it is a series B startup? * No mention of what leadership team makes (VP of Eng is ultimately a managerial role - is it equal to L7? L8? YoE a consideration in this role?) * Company is fully remote - Remote within the US? Any where in the world? * How will (if at all) cost-of-living be adjusted (for remote)? * What is the interview process like (Is leetcode grinding still required - effectively pushing for a "fresher" workforce?). * If comp affects the "quality" of hire - what is the perf management (and appraisal) culture looking like in there?

130 points by vr000m 5y ago

I am not sure if this kind of transparency will be beneficial to the employees or not. Like the article mentioning there is leverage missing for salary negotiation. That mean, that some folks would earn less assuming the model was adapted everywhere. However it may clean up inequalities. In the end people are divers. There are hires with only 2 years delivering better results, than one with 5 years.

someelephant 5y ago
you got to appreciate that honesty about leverage. this whole program was designed because they weren't competitive in the market.

nicoburns 5y ago

This seems broadly sensible. Only counting experience after schooling ends won't work for everyone though. I was employed full time as a software developer before I went to university. And I had 5 years of non-commercial experience before that while I was still in high school that most people won't have. Presumably there's some wiggle room for managers to use their judgement on what counts as experience, so it probably works out.

KevinEldon 5y ago
You would negotiate how that experience is recognized in the hiring process.

david_allison 5y ago

> We start counting years after formal schooling (high school or college). Grad school often counts as indirect experience. As someone who worked in software development during High School, and took time off before University to work in software, this somewhat frustrates me. Alyssa Rosenzweig has 0 years of experience under this model.

justinlloyd 5y ago
Me too. I never left school. I shipped my first commercial product in 1978 at the age of 11, launched my first company at age 14, and sold my first company at age 19. Here I am 44 years later with zero years of experience because I keep adding more years of college and university. I am not exactly the brightest crayon in the box, but I found college "easy" because I had years of professional discipline meeting deadlines. This idea of counting experience only after you left college is absolute nonsense. And too add, I never actually graduated from the UK equivalent of high school, which drives HR people nuts, especially when they find out that the CTO of the company they are acquiring is a high school dropout.
- KevinEldon 5y ago
  May you continue to work until you no longer want to, create on your own terms, and drive as many HR people nuts as possible!
  - justinlloyd 5y ago
    I have never worked a day in my life. I get paid generous amounts of money to play.
- codechad 5y ago
Xcelerate 5y ago
Yeah, I was a bit frustrated with this as well. I was somewhat down-leveled right after finishing my PhD because a lot of employers didn't consider it experience, even though I did high performance computing work with projects that had multiple stakeholders. Honestly, I was more technically savvy then than I am now 4 years into working at a large tech company.
- marcinzm 5y ago
  >Honestly, I was more technically savvy then than I am now 4 years into working at a large tech company. The usual reason I see for down leveling is because being technically savvy is not what companies actually look for. I'm talking most jobs rather than being in an R&D division that is PhD heavy. * Understanding the modern SDLC in a corporate environment and best practices. Academia often doesn't do things in a way that would be considered good production practices outside of it. Both from a process and a technical (CICD, heavy testing, layered frameworks, etc.) point of view. * The culture of academia differs from corporate which means that while you gain soft skills they are biased versus what you'd get in a corporate environment. That can have subtle or not so subtle impact on decision making.

yawgmoth 5y ago

Living in the Midwest and currently working remotely for a NY based company. Remote / coastal salaries are so much higher than typical Midwest engineering salaries that I'll never be able to return to the office again. This feels like a problem worth examining, but what can be done?

JackMorgan 5y ago
For possibly the first time in human history we workers are able to get the benefits of geographic arbitrage and still command some of the highest salaries in the world. I really like that and appreciate it. However, if the dual benefits of going into an office and living in the Midwest are important enough for you, that office will cost you a lot in missed opportunity costs. I don't know if that's a problem that can be solved, or just a natural law of constraints.
cebert 5y ago
I live in the Detroit area, and also noticed a huge salary discrepancy between local salaries and those for remote positions. The positive is there are many great opportunities for us to increase our income while living in a lower-cost area than Seattle, NYC, SanFran, etc. Midwest based firms need to reconsider their pay bands, or they’re going to have problems competing for talent.
- humanrebar 5y ago
  Midwest salaries have been low for a long time, and it has had an effect on the ability to attract and retain top talent. The difference now is that the market for employment for engineers unwilling to relocate to those coastal cities has expanded dramatically. The new entrants are coming in with market-clearing salary offers. I predict we'll see salary expectations in the Midwest increase dramatically. Some Midwest employers will have to adjust their business plans accordingly. For instance, consulting shops may have to increase pricing quite a bit.
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KevinEldon 5y ago

"If everyone can get promoted simply by sticking around, managers have to be active in communicating with people who aren’t meeting expectations and helping them improve. Managers also have to be willing to let people go if they don’t show progress."

twobitshifter 5y ago

The company I’m with now makes promotions without salary increases. The salary increase comes in the next review cycle when you’ve proven that you can do the job. It seems very unusual to me, has anyone else seen this?

LandR 5y ago
So you get promoted, then have to do that job at a lower salary than the position should get you. Once you get the raise at the review cycle, is this also back paid for the time you were under paid for the role ?
- taneq 5y ago
  Pretty cunning, I bet whoever thought that one up got a raise (in the next review cycle).
- ant6n 5y ago
  At my place (not software), they ask me to perform the job at the next level, in order to prove that I can do it, before promoting me. They also require that at least 2 years are spent at each level. And during Corona they didn't promote anybody, meaning everybody`s career slid back by up to an extra year, depending on where u were in the cycle. I would've much preferred if they had promoted ppl and done salary increases later.
- sokoloff 5y ago
  With overlapping bands, it’s not necessarily the case that you were being underpaid (in a cosmic fairness sense). If you are a level N Foo and doing well (as determined by doing some amount of level N+1 work), you might be earning the top of the level N Foo band. If that’s above the bottom of the N+1 band, you might be making the same as or more than the most recent N+1 hire. The day the company decides that your level “rounds” from N to N+1, you might already be being paid the exact correct amount. Design of pay scales and how they interact with promotion thresholds is complex enough that many fair systems can evolve. Most systems have evolved to slightly underpay the “almost N+1” employees for a period of time, leading to the expectation that promotion come with an immediate salary bump (and often companies do that to make the promotions “feel bigger”), so maybe the problem is promotions under that system should come with back pay rather than the situation described here being the one where back pay is owed.

jen20 5y ago

From the article: > Direct experience in our rubric means substantially the same kind of work (coding, design, product management, etc.) This is a recipe for finding people without "n" years of experience, but instead finding people with one year of experience repeated "n" times. Great if you need a specialist in something, tragic if you need generalists - which most startups do.

justinlloyd 5y ago
Having founded and worked at quite a few start-ups, start-ups should aim for one specialist for every half-dozen generalists, preferably even lower than that. It's not a hard and fast rule, and pretty flexible, but if you have a single generalist and lots of specialists in a start-up, you are in trouble.

someelephant 5y ago

promotions are such an absurd idea in this job market

lscdlscd 5y ago

parkingrift 5y ago

Strong disagree with basing salary on years of experience. I see almost no correlation between output, skill, and years of experience. I actually consider this an anti-pattern that actively encourages coasting.

ct0 5y ago
Experience is relative here. While I agree, there should be an adjustment that captures something like "years of performance", but its harder to quantify.
sokoloff 5y ago
I think there’s a large correlation in the 0-3 years window. I agree there’s almost none in the 12-15 years window.
- cindarin 5y ago
  Amusingly to me, I think the opposite.
  - sokoloff 5y ago
    That’s fascinating to me. I’d love to chat more deeply about that, but I can’t see a way to get at the essence of the difference in an HN thread.
    - pc86 5y ago
      I tend toward your side of things. In your first 0-n years of experience, you're growing extremely quickly (hopefully). You're working with a lot of new tech, new people, if n is greater than 4 or 5, hopefully at least two companies if not three. But by the time you have n-teen years of experience, it's much more like you've been repeating the same year of experience over and over again. Growth, especially if you have a decade of experience (and not one year ten times), is hard. I think especially at the upper end it takes dedicated effort.

KevinEldon 5y ago

This seems like a reasonable strategy worth if you plan to exit in the next 3 years. It is simple to manage, is designed to be competitive for a point in time, and focuses on performance for growth (up or out).

sokoloff 5y ago
I think simple to manage and “people who don’t like it won’t bother us about promotions” is high here. Whether that makes it worth losing out on corner cases where you’d benefit from a more individualized approach isn’t as clear to me, but there’s a lot of benefit from elimination of all promotion discussions, referring all of those to “check the calendar; if we haven’t fired you by X, you’ll be level Y on that day.”

kybernetikos 5y ago

I like the transparency and fairness. I dislike that it rewards time rather than merit and will likely discourage people from developing expertise away from their core skillset as there could be an argument that their experience in that area isn't relevant, or that their relevant experience in this area is so small.

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btucker 5y ago

I appreciate the intent here of making levels more transparent & evenly applied, but in practice this seems to be tying levels/comp to a demographic attribute people have no control over: their age. This makes me feel uncomfortable.

lmilcin 5y ago

Salary based on your "experience" as measured by the number of years you survived sitting by the computer. This is absolutely, fucking dumbest idea I ever heard. Say you have two engineers that both have 10 years of experience, one is barely scraping by and one is working his ass off and significant contributor to the team. They earn the same money and, more importantly, they both know it. And the team knows it. And the manager knows it. Can you guess which one will feel treated unfairly and will start looking for a new job? Imagine a good employee comes to you and says she is going to leave because she has been offered better salary somewhere else. You have now only two choices: 1) break the commitment you made to entire company, 2) let her go. You can also decide to promote her, but management is really a different job and you lost your team member anyway. Over time your business will accumulate people who just barely passed your recruitment process and are just barely competent to avoid being let go. If you think you will keep the better one just because you say some nice words and give them recognition token, guess again. Let me explain what this means: it promotes people who sit idly by the computer (because they gain regardless of their involvement) and punishes people who actually give a shit and who try hard being better every day. It punishes your business HARD. In most businesses, most progress is being done by small minority of employees. And now you are leaving gates open and saying you are not going to even try to keep them doing good job.

verve_rat 5y ago
It's the dead sea effect. All the good people evaporate leaving only the salt.
mnsc 5y ago
> Ambitious people like achieving goals. Like coming in, making the biggest impact they can eg. do a large spectacular redesign, leave for 10% pay jump immediately and never sticking around for that maintenance nightmare that were hidden in the details? Incentives will always be a tradeoff because you can't measure skill.
- lmilcin 5y ago
  > Incentives will always be a tradeoff because you can't measure skill. Oh, so because it is hard let's just stop trying? You can't measure skill accurately. But you can try to find correlations and you can measure other things that are as much or even more important like... erm... results?

jawns 5y ago

My career path was 10 years in journalism, during which I was also programming as part of my responsibilities, and now 11 years in full-time software development. Under Daily's levels system, I'd have 11 years of "direct" experience and 5 years of "indirect" experience, for a total of 16 years of experience, putting me in their highest band (Level 7) with a salary of $270K. But as I've told every employer who's hired me since leaving journalism, and particularly as I've transitioned from an IC to a manager, those years of experience in journalism were invaluable. I learned how to ask the right questions; how to handle the stress of always being on deadline; how to be a generalist, quickly learning enough about a subject that you can clearly explain it to others; how to communicate effectively in general; and many other skills that are absolutely relevant today. Obviously, it wouldn't matter for this banding whether those years are treated as "indirect" or "direct" experience -- I'd be in Level 7 either way -- but I could see it matter for others. Full disclosure: I applied to Daily last year but they ended up filling the position with an internal candidate.

sockpuppet69 5y ago
Mezzie 5y ago
Yes, the years of experience metric greatly underestimates the value brought by rare synergies. I'm a decent programmer/developer, but that isn't my primary worth to a company. My primary worth to a company is that I'm a competent developer with additional specializations in both high-level research and media relations/communications.

thenerdhead 5y ago

There’s a huge loyalty tax being paid here. Although the transparency is nice to have, it’s simply not a sustainable model. People grow at all sorts of rates professionally. Some people can grow from a formal level to another in a year as they get a hang for their responsibilities/job. Some people have extremely hard years due to external factors too. This type of system incentivizes nobody. Why work hard? Why do challenging stuff? Why take on the jobs with most responsibilities? Etc > In the coming months, we aim to develop written guidance on what career growth looks like for different roles, and we'll start experimenting with rewards and recognition other than salary for particularly noteworthy achievements. How do you reward or give recognition if your system isn’t fully thought through or based on the traditional methods of perceived impact and notable accomplishment? Isn’t that exactly what this would be anyway? Honestly this sounds like a startup who just landed recent funding thinks they are “disrupting” the market with new unconventional TC methods. Not everyone is the same. One person with ten years of experience is another persons four years. What fairness is to me is understanding where you sit relative to your peers and market. It is checks and balances of your worth and not political players reaping the rewards constantly. It’s the whole idea that there’s three types of workers: experts, operators, and politicians. The former two actually do the work, the latter just takes the credit more visibly.

pfortuny 5y ago
This is topical but your comment reminded me of Deming’s New Economics. Rewards in a system with intrinsic variance are harmful and unjust.
- thenerdhead 5y ago
  Yep, everyone needs to work together so everyone can win.

benreesman 5y ago

This is sort of well-articulated and someone thought about it a lot. The salaries seem fine, as long as there’s 1MM in liquid equity to go with the L7 one like Google does. But it doesn’t seem to address the real issue (to which I also don’t have a final answer): the jock/nerd thing is still playing out. If, as I believe is mostly true, A16 is pretty on the money with the software eats the world thing: hackers “should” today and inevitably will be the highest paid people possibly excepting the best salesperson. If you worked successfully on an optimizing compiler all day, anything that an MBA teaches is borderline boring. COVID/WFH only turbocharges this: tall white guys have way less edge over Zoom. It’s going to be a painful, but ultimately necessary transition where everyone whose math stopped at calc has their TC stop at 150-200k, and that money/seniority/prestige goes to the only truly irreplaceable people, again with the notable exception of the sales guy.

cindarin 5y ago
You may be right about many things you said, but this comes off as though you've got a complex about something.
- benreesman 5y ago
  I’ll extend you the benefit of the doubt and assume your intention is to be helpful. Can you be a little more specific and thus potentially actionable?
  - cindarin 5y ago
    Unfortunately, I have neither the proper information nor interest to dig into that specifically. My best recommendation is to look into why I might have said that, and decide if you care at all what I thought. If so, take actions to change what things that you have a desire to change.
    - benreesman 5y ago
      Maybe keep it to yourself if the game plan is to half-ass psychoanalyze someone and then bail when asked a follow up question?

humanrebar 5y ago

> Not being able to pay enough for great candidates is a common problem for startups, and we’ve already had to accept that some very strong potential teammates won’t even consider us, given enormous salaries at established tech companies. But by doing the legwork to make sure we’re competitive within our cohort, we believe we’ll have enough great candidates who want to work at a company of our stage and size. Recruiters and managers out there: I read "competitive" compensation as somewhere around median compensation. That will be attractive to undercompensated employees and employees in their early careers. It's hard to get good candidates to leave current roles without some sort of pay bump (20%, say?) unless there's some sort of serious dysfunction or mismatch with their current employers. Daily's plan is to shoot for median-ish compensation and get "enough great candidates" to reach the next phase of growth. I'm glad they're planning on revisiting in a year or so, though it's easy to kid yourself. Especially when you're taking what current employees are willing to tell you as proof positive. For one, selection bias is certainly happening. Also, in my experience, people tell you what you want to hear. Daily employees that are significantly unhappy with compensation are a bad fit for Daily now given the blanket compensation policy. The best way to address that is to discretely look for other offers.

sockpuppet69 5y ago

angarg12 5y ago

I worked for a very old fashioned company in Germany that used a similar system to pay employees. After about a year I became the lead of my team. But since some of my colleagues had been in the company about 10 years, they were getting paid more than me. Frustrated, I left for a better (and better paying) job. I believe these systems produce a "dead sea effect". High performer will leave, being able to get better deals elsewhere. Low performers will stay, since they can' find a better deal elsewhere.

woadwarrior01 5y ago
Interesting! I didn't know this phenomenon had a name. I've seen the "dead sea effect" at a well known SV bigtech co as well. And this company has biannual performance review rituals.
- oblio 5y ago
  http://brucefwebster.com/2008/04/11/the-wetware-crisis-the-dead-sea-effect/ http://brucefwebster.com/2008/04/11/the-wetware-crisis-the-d... The blog has a bunch of other good article on related topics.
humanrebar 5y ago
If you felt you were underpaid, leaving is fair. I don't really understand the requirement that all bosses are paid more than those they supervise, though. I mean, emotionally I can understand feeling that way. But I don't think it's a rule of nature or something. For instance, coaches often make less than their star players. Directors and producers often make less than star actors. Hospital directors seem to make less than surgeons.
- soco 5y ago
  Here in Switzerland, most of the non-IT people I'm talking with are genuinely surprised that for instance project managers are paid less that developers. For them just hearing the word "manager" = big buck.

mepiethree 5y ago

I’ve worked with plenty of people with “bad experience”. People who don’t learn from their mistakes, and consistently repeat the same errors, even things as basic as not testing their code before creating PRs. I guess this model works if you identify and fire those people early, but in general, this seems like a great way to retain proven career underperformers.

FL33TW00D 5y ago

YOE has little correlation with performance.

micromacrofoot 5y ago

holy shit are people with 5 years experience really making 200k!?

SloopJon 5y ago

My company has four IC titles, the description of which includes typical experience, with credit for graduate degrees. When we went from two titles to four, I was assigned the highest title, and joked that it was another way of saying "old". I would be level 7 under Daily's system, making more than I do now, but then what's my monetary incentive to improve? Younger, less experienced colleagues can literally set a countdown timer to their next promotion/raise. It feels a bit lazy, to be honest. Some people have commented that it will lead to coasting. The alternative that I anticipate is up or out: you're a level 5 performer at a level 7 salary. You might be happy at a level 5.5 salary, but sorry, you're out.

Cthulhu_ 5y ago
It makes me think of Amazon's PIP system, where managers HAVE to get rid of the lower 20% of performance - whichever performance metric that is. When applied to this, it kinda means - assuming it's x years at the same company / using the same system - you don't get paid more for having X years of experience, but surviving X years of performance review firings. It's X years of not being in the worst 20%. I mean if using that system I'd probably set the bar higher, but thankfully I'm not.

gwbas1c 5y ago

I suspect that, for most locales, they're beating the market. There's a good chance I'd count for 15+ years of experience, and thus they'd pay me much more than my local market normally pays me. On the other hand, I had a company with a similar salary structure approach me. They were based in a distant country with a much lower cost of living. I pointed out that their salary was about half of what I normally earn. They didn't "get" it that they were out of their game trying to recruit me.

smrtinsert 5y ago

Numbers wise looks good to me. Amazons recent base cap has thrown recruiters sideways and numbers instantly jumped in reach out emails. Turns out yes, compensation should be increase for hard to find skills that people use to create huge revenue. Shocked.

robertlagrant 5y ago

This is quite interesting, and I'm curious to see how it goes. I do think the definition of "fairness" is off, though: > Because using years of relevant experience is transparent and repeatable, both for leveling and promotions, it carries a strong measure of fairness Or more precisely, there are lots of ways to define "fair". And in this case fair is defined as "more years in post means more money, whatever your job is". This is not general fairness (perhaps nothing is) but it rewards loyalty. Other types of fairness (which actually their sales teams get) is "create more value, get paid more". I.e. kicking back for 10 years in a role that's fairly straightforward and hard to measure might reward someone as much as working incredibly hard and transforming the business for 10 years. That could well be considered unfair. I think rather than "fair" it's just "easy to measure", which accounts for the lack of need for promotion recommendations. I've never known them take very long, but yes, a length of tenure calculation will always be quicker. I would say also that I am curious as to how competitive this can possibly be for attracting talent. Desirable employees who need incentive to move to a company will generally get more money, as otherwise they won't move. Additionally retention might be an issue, as the same principles apply; market forces will mean that other companies that pay according to what an employee will agree to work for will have extra cash to wave at daily.co employees. Finally, I suppose that in the short term, powered by VC money, this is likely to work, and it's as good a way to spend VC money as any. I don't think we should call it a revolutionary way of working, as having a pit of money to prop up an idea does not make the idea sustainable for other companies. It might remain automatically workable for years to come if the company raises more money without having to survive on its own merits.

giantg2 5y ago

Wow, just aging into a promotion? This seems very attractive as a worker. But even I can see this could be problematic and not align to value production.

bl4ckm0r3 5y ago

It really feels like the objective for growth is just to wait, and not based on actual skills. Not sure if this is a good metric tbh, years of experience have a lot to do with type of challenges, and type of challenges have a lot to do with environment and architectures. you can be working 10 years on a small flower shop or building a huge distributed system that can handle crazy traffic or have really complex business logic. The worst thing to me is that it encourages engineers to focus on less risky challenges since the complexity of the work does not contribute to experience.

thebackup 5y ago

It’s interesting to see these salary levels. A senior developer (10+ years of experience) here in Sweden is paid less than their entry level salary. The difference in pay between Europe and the US seems huge. I wonder why.

flibblercorn 5y ago
Yes that is something that comes up on hackernews a lot, and I personally still struggle to accept it. According to the Daily level system I should be in their band 5, so $210K, but in England I am paid less than half their entry level salary (at current exchange rates). Americans don't have IQ scores, or any other metric to suggest being approximately 4-8 times the quality of other developed countries workers, so it's hard to just take it and accept that their compensation isn't due to their ability (on average), and that life isn't fair.
- jandrewrogers 5y ago
  I am an American who has worked in Europe for many years at multiple companies, so I feel at least somewhat qualified to give some insight. Europeans are just as talented technically as Americans, that has never been the issue. As a broad generalization, European business culture is consistently poor at leveraging that talent to generate value, often treating it like factory work. Because American business culture is so efficient and effective at converting engineering talent into revenue, often on the scale of $1M revenue per engineer, they can easily afford to pay the higher wages while still making a fine profit. This has the side effect of making the market for engineering talent extremely competitive. In short, European technical talent as a resource is often being wasted by poor business practices, which means there is much less money to go around. There is no reason in principle that European engineers could not earn much more in Europe but changing business culture is slow, though some companies are trying.
  - thebackup 5y ago
    Thanks for this comment. A very interesting observation. Do you have any thoughts regarding American companies that are established in Europe, shouldn't they be able to introduce that American culture in their European offices?

mindvirus 5y ago

On one hand, this is pretty nice. I've always hated the career management aspect of working in the software industry, and so to have it so transparent and approachable makes a ton of sense so you can focus on doing work. However, my big question is how expectations and performance management scale with level? If someone's not there yet, but hits the years of experience for the next level, are they fired? Likewise, whose responsibility is it for people to get those skills by the time they age into the next promotion? Quick edit: Also wanted to call out how well written this post is. It lays out the facts, peoples objections, unknowns, and anticipates questions (salespeople remain on variable comp, equity isn't being addressed yet). So kudos to the author for the great writing on this thoughtful piece.

kodah 5y ago

While I like this promotion system, I think it lacks something like what the military calls "billets". If I'm a principal engineer and I lead two teams of engineers to deliver projects then I should be compensated for my knowledge as a principal engineer, then I should be compensated for the magnitude of responsibility of being a team lead. They are, in fact, two separate things.

rileymat2 5y ago

One thing I have always wondered about is if seniority based compensation can promote training without fear of replacement, actually improving the team over the longer term.

flashgordon 5y ago

So couple of things that stood out for me here: * Constant pay hikes per level (~30k every 2-3 years) * Any equity guidelines for level (especially since it is a startup) - I assume this is not a 9-5 job given it is a series B startup? * No mention of what leadership team makes (VP of Eng is ultimately a managerial role - is it equal to L7? L8? YoE a consideration in this role?) * Company is fully remote - Remote within the US? Any where in the world? * How will (if at all) cost-of-living be adjusted (for remote)? * What is the interview process like (Is leetcode grinding still required - effectively pushing for a "fresher" workforce?). * If comp affects the "quality" of hire - what is the perf management (and appraisal) culture looking like in there?