4 ms·

I always figured pay was based on market condition for finding employees, not a companies specific profit. If a trucking company is losing money, they still ha

I always figured pay was based on market condition for finding employees, not a companies specific profit. If a trucking company is losing money, they still have to pay market wages for drivers if they want any trucks to move. If a trucking company is making large profits because of the types of trucks they bought, their niche, their sales teams, they still basically pay market prices for drivers I would assume.

delfinom 3y ago
Yea, usually it's prevailing market conditions, not just for finding employees but also retaining them. Not giving raises is another form of increasing gradual attrition on purpose as well.
cornfutes 3y ago
> I always figured pay was based on market condition for finding employees, not a companies specific profit. It has parallels to this Doordash delivery person who expected their tip to be based on the price of the customer's house rather than the price of the order. https://www.nbcnews.com/news/us-news/doordash-driver-curses-customer-tip-online-debate-rcna92596 https://www.nbcnews.com/news/us-news/doordash-driver-curses-...
- fnordpiglet 3y ago
  I find delivery prices based on either to be weird. Delivery prices should be based on the complexity and difficulty of the delivery. If I get an iPhone delivered I don’t expect to pay a percentage of my house value or my iPhone value, likewise I expect to pay more for delivery of 10 gallons of milk than an iPhone. The price scale percentage is for restaurant service where the price of the food scales with the quality of the restaurants service. Delivery service more or less is entirely fungible and doesn’t vary in general with the price of the delivered item. The only thing I expect to vary with the cost of my house is my property taxes.
  - gizmo686 3y ago
    The idea that tips are based on price in general is weird. It only makes sense to me if I think about them less as compensation, and more as a power play. Given the history of tipping in the US (where it didn't gain traction until emancipation, where it became the way to pay some former slaves), this power play reading seams plausible.
    - JumpCrisscross 3y ago
      > Given the history of tipping in the US (where it didn't gain traction until emancipation There isn't great evidence for this. There was a burst of anti-tipping laws in the 19th century as aristocratic Americans imitated the Tudor English where modern tipping originated. It only became endemic in America during Prohibition, when a lack of alcohol-based income and the, ahem, two-way desire for favors, increased.
- lupire 3y ago
  That's called price discrimination and almost all successful businesses do it.
x86x87 3y ago
that's shortsighted. I can understand adjusting the pay raises but not freezing pay altogether. freezing the pay sends the message of: "we don't really care about the workers and we will extract as much value as it's possible for the lowest possible fee". The problem with knowledge workers is that sometimes it literally takes years to build the skill needed and if you don't actively work on retaining people you will end up with empire building and the minimum work not to get fired instead of exceptional people that can move the needle - the brain drain is real. to drive this point home: if you have 100 people that you are paying 100 dollars you are paying 10k. if you give them a raise and now you are paying them 105 dollars you are not paying 10.5k. if you don't give them a raise and you tell them to suck it up, 20 people leave and now you need to hire 40 people to be able to pickup the work they were doing, now you will pay 14k. So while in theory you are getting a bargain keeping the comp at 100, you in reality are paying more. Even worse, you may get ideas that you don't need 100 people and layoff 30 people with the remaining people doing the work of 100 people - so in effect you are getting more work for that 100$ and people are actually taking a paycut relative to how much they are working.
- jmoak3 3y ago
  > freezing the pay sends the message of: "we don't really care about the workers and we will extract as much value as it's possible for the lowest possible fee". It’s not a charity. Neither are we as engineers - the job hopping we’re famous for is evidence of that.
  - x86x87 3y ago
    The job hopping is a symptom of the shortsighted decision making that optimizing only for your next quarted gets you. Proper planning, execution, building knowledge? Fuck that. We'll just jerk people around. What are they going to do? Form an union?
  - Salgat 3y ago
    It is a paid collaboration however.
- talldatethrow 3y ago
Mystery-Machine 3y ago
Pay is usually based on the least amount of money a company can pay you to work for them. I call this "business as usual". Whenever I need to choose between prioritizing myself vs prioritizing my employer, I try to use the "business as usual" philosophy in which I understand that the employer would fire me if they had to choose to save money (rather than for example cutting CEO's salary or in any other way looking at employee's interests). So I prioritize myself. I learned this lesson when I was contracting for a client and the client told me, on Friday afternoon that starting from next week he doesn't need my services anymore. Basically he fired me on the spot. Next week I noticed that someone was still making programming changes to the site. Seems like he hired a bunch of inexperienced inexpensive developers to do the work. Needless to say, a year later he asked me to jump back in, and I did for double the price. He, in his true "business as usual" style, didn't even blink. He needed the job done and was willing to pay the price I offered. Business as usual. Great life lesson.
lotsofpulp 3y ago
>I always figured pay was based on market condition for finding employees, not a companies specific profit. It is. Anything an executive or company spokesperson says to the contrary is lying. If Microsoft really wanted to retain someone who said they were going to walk if they did not get an increase, then they would pony up.
makeitdouble 3y ago
This still needs adjustments when your profits can vary based on your employees. For instance if your trucking company asks the drivers to optimize delivery routes or act as salesmen to the other companies, cutting them from profits means no incentive to expand those. Microsoft's play here is that even if their best engineers go look for greener pastures their profits won't be affected. It might be true, but that feels like a bold move.

delfinom 3y ago

Yea, usually it's prevailing market conditions, not just for finding employees but also retaining them. Not giving raises is another form of increasing gradual attrition on purpose as well.

cornfutes 3y ago

> I always figured pay was based on market condition for finding employees, not a companies specific profit. It has parallels to this Doordash delivery person who expected their tip to be based on the price of the customer's house rather than the price of the order. https://www.nbcnews.com/news/us-news/doordash-driver-curses-customer-tip-online-debate-rcna92596 https://www.nbcnews.com/news/us-news/doordash-driver-curses-...

fnordpiglet 3y ago
I find delivery prices based on either to be weird. Delivery prices should be based on the complexity and difficulty of the delivery. If I get an iPhone delivered I don’t expect to pay a percentage of my house value or my iPhone value, likewise I expect to pay more for delivery of 10 gallons of milk than an iPhone. The price scale percentage is for restaurant service where the price of the food scales with the quality of the restaurants service. Delivery service more or less is entirely fungible and doesn’t vary in general with the price of the delivered item. The only thing I expect to vary with the cost of my house is my property taxes.
- gizmo686 3y ago
  The idea that tips are based on price in general is weird. It only makes sense to me if I think about them less as compensation, and more as a power play. Given the history of tipping in the US (where it didn't gain traction until emancipation, where it became the way to pay some former slaves), this power play reading seams plausible.
  - JumpCrisscross 3y ago
    > Given the history of tipping in the US (where it didn't gain traction until emancipation There isn't great evidence for this. There was a burst of anti-tipping laws in the 19th century as aristocratic Americans imitated the Tudor English where modern tipping originated. It only became endemic in America during Prohibition, when a lack of alcohol-based income and the, ahem, two-way desire for favors, increased.
lupire 3y ago
That's called price discrimination and almost all successful businesses do it.

x86x87 3y ago

that's shortsighted. I can understand adjusting the pay raises but not freezing pay altogether. freezing the pay sends the message of: "we don't really care about the workers and we will extract as much value as it's possible for the lowest possible fee". The problem with knowledge workers is that sometimes it literally takes years to build the skill needed and if you don't actively work on retaining people you will end up with empire building and the minimum work not to get fired instead of exceptional people that can move the needle - the brain drain is real. to drive this point home: if you have 100 people that you are paying 100 dollars you are paying 10k. if you give them a raise and now you are paying them 105 dollars you are not paying 10.5k. if you don't give them a raise and you tell them to suck it up, 20 people leave and now you need to hire 40 people to be able to pickup the work they were doing, now you will pay 14k. So while in theory you are getting a bargain keeping the comp at 100, you in reality are paying more. Even worse, you may get ideas that you don't need 100 people and layoff 30 people with the remaining people doing the work of 100 people - so in effect you are getting more work for that 100$ and people are actually taking a paycut relative to how much they are working.

jmoak3 3y ago
> freezing the pay sends the message of: "we don't really care about the workers and we will extract as much value as it's possible for the lowest possible fee". It’s not a charity. Neither are we as engineers - the job hopping we’re famous for is evidence of that.
- x86x87 3y ago
  The job hopping is a symptom of the shortsighted decision making that optimizing only for your next quarted gets you. Proper planning, execution, building knowledge? Fuck that. We'll just jerk people around. What are they going to do? Form an union?
- Salgat 3y ago
  It is a paid collaboration however.
talldatethrow 3y ago

Mystery-Machine 3y ago

Pay is usually based on the least amount of money a company can pay you to work for them. I call this "business as usual". Whenever I need to choose between prioritizing myself vs prioritizing my employer, I try to use the "business as usual" philosophy in which I understand that the employer would fire me if they had to choose to save money (rather than for example cutting CEO's salary or in any other way looking at employee's interests). So I prioritize myself. I learned this lesson when I was contracting for a client and the client told me, on Friday afternoon that starting from next week he doesn't need my services anymore. Basically he fired me on the spot. Next week I noticed that someone was still making programming changes to the site. Seems like he hired a bunch of inexperienced inexpensive developers to do the work. Needless to say, a year later he asked me to jump back in, and I did for double the price. He, in his true "business as usual" style, didn't even blink. He needed the job done and was willing to pay the price I offered. Business as usual. Great life lesson.

lotsofpulp 3y ago

>I always figured pay was based on market condition for finding employees, not a companies specific profit. It is. Anything an executive or company spokesperson says to the contrary is lying. If Microsoft really wanted to retain someone who said they were going to walk if they did not get an increase, then they would pony up.

makeitdouble 3y ago

This still needs adjustments when your profits can vary based on your employees. For instance if your trucking company asks the drivers to optimize delivery routes or act as salesmen to the other companies, cutting them from profits means no incentive to expand those. Microsoft's play here is that even if their best engineers go look for greener pastures their profits won't be affected. It might be true, but that feels like a bold move.