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In a title-band compensation controlled org, oldest in band being highest paid is extremely common outcome, think about it. Once you hit the terminal IC level,

In a title-band compensation controlled org, oldest in band being highest paid is extremely common outcome, think about it. Once you hit the terminal IC level, a developer may be in that title band for a decade or more. At a typical bank it's like.. Analyst->Associate->AVP->VP. However from VP on up, the pyramid narrows sharply. The ratio of Analyst:Associate may be close to 1:1. The ratio of Associate:AVP may be 1.5:1 The ratio of AVP:VP also around 1.5:1 or 2:1. However from there the ratio of VP->ED and ED->MD are like 5:1 or worse. ED&MD are far more executive management type roles. Zero coding, you may run an org of 100 people. So the earliest you hit VP might be like 28ish. But you'll find VPs that are 45 to 50 easily. It's an up or out level. Slowly accumulating raises as you age without seeking a management role means out eventually.

sokoloff 3y ago
Sorry. I'm not arguing it doesn't happen. (I agree that it's an extremely common outcome.) I'm arguing that it shouldn't happen and, if it does, that would explain that layoffs disproportionately hitting those whose return-on-cost is lowest means disproportionately hitting those whose candles-on-cake is highest. > Slowly accumulating raises as you age without seeking a management role means out eventually. At whatever the career level is for your org, some people should probably stop getting merit raises entirely. If their merit isn't increasing, there's no reason their pay should be either. They could drift up as the entire market wage drifts up, but if a 10-years-at-VP is just as valuable as a 20-years-at-VP, they should be paid the same. (I'd much rather start having that conversation when they're 11-at-VP and get no merit raise and it's still a good time economically than 9 years later when they're surprised to be shown the door with zero warning after a string of merit-free merit increases and a stack of "meets expectations" performance reviews.)
glenngillen 3y ago
I know this is an aberration during particular boom times, but there’s been a couple of times in my career (circa 2012 and 2020) where new hires were routinely being paid more than more tenured employees at the same level. It’s because large companies try to align comp to some local market benchmark, for example the 75th percentile, but that only ever applies to _new_ offers. I’m yet to experience a company that when faced with data that says there’s been huge growth in compensation year on year go through and give everyone big pay rises.
- steveBK123 3y ago
  It depends on how big a company is and how their HR works. I worked at big dumb banks that gave outsize raises the year after promotion to "adjust for market rates" but then in high performance years gave negligible raises because we were all just numbers on a spreadsheet. The incentives this create as well are perverse because performance becomes less a driver of a big raise in the short term. In the long term of course, the performance probably drives the promotion which is the thing that gets you into the higher band in which you can be awarded random unearned raises. However in the long term its easier to just jump ship for a guaranteed 20%+ bump than to pray for a random 10% every N years.
- Macha 3y ago
  > I’m yet to experience a company that when faced with data that says there’s been huge growth in compensation year on year go through and give everyone big pay rises. I have actually had a former employer do this once. I think it worked out best for those with 2-3 years of experience, some of whom got 20-25% pay rises, while those with 0 years of experience were closer to hire date and hence what the company considered market rate, while those with more experience were better at negotiating raises on an ongoing basis.

sokoloff 3y ago

Sorry. I'm not arguing it doesn't happen. (I agree that it's an extremely common outcome.) I'm arguing that it shouldn't happen and, if it does, that would explain that layoffs disproportionately hitting those whose return-on-cost is lowest means disproportionately hitting those whose candles-on-cake is highest. > Slowly accumulating raises as you age without seeking a management role means out eventually. At whatever the career level is for your org, some people should probably stop getting merit raises entirely. If their merit isn't increasing, there's no reason their pay should be either. They could drift up as the entire market wage drifts up, but if a 10-years-at-VP is just as valuable as a 20-years-at-VP, they should be paid the same. (I'd much rather start having that conversation when they're 11-at-VP and get no merit raise and it's still a good time economically than 9 years later when they're surprised to be shown the door with zero warning after a string of merit-free merit increases and a stack of "meets expectations" performance reviews.)

glenngillen 3y ago

I know this is an aberration during particular boom times, but there’s been a couple of times in my career (circa 2012 and 2020) where new hires were routinely being paid more than more tenured employees at the same level. It’s because large companies try to align comp to some local market benchmark, for example the 75th percentile, but that only ever applies to _new_ offers. I’m yet to experience a company that when faced with data that says there’s been huge growth in compensation year on year go through and give everyone big pay rises.

steveBK123 3y ago
It depends on how big a company is and how their HR works. I worked at big dumb banks that gave outsize raises the year after promotion to "adjust for market rates" but then in high performance years gave negligible raises because we were all just numbers on a spreadsheet. The incentives this create as well are perverse because performance becomes less a driver of a big raise in the short term. In the long term of course, the performance probably drives the promotion which is the thing that gets you into the higher band in which you can be awarded random unearned raises. However in the long term its easier to just jump ship for a guaranteed 20%+ bump than to pray for a random 10% every N years.
Macha 3y ago
> I’m yet to experience a company that when faced with data that says there’s been huge growth in compensation year on year go through and give everyone big pay rises. I have actually had a former employer do this once. I think it worked out best for those with 2-3 years of experience, some of whom got 20-25% pay rises, while those with 0 years of experience were closer to hire date and hence what the company considered market rate, while those with more experience were better at negotiating raises on an ongoing basis.