7 ms·

This is really interesting because it juxtaposes two fundamental issues: (1) The business need to make sensible, sustainable decisions that increase the ability

This is really interesting because it juxtaposes two fundamental issues: (1) The business need to make sensible, sustainable decisions that increase the ability of the company to prosper, and (2) the human need to address the day-to-day realities of getting by on a sub-$50k salary. Notably, the article focuses almost entirely on #2, but doesn't really try to claim that this is a strong business move. I have really mixed feelings on this. Too many businesses are all about profits and have forgotten the critical human need for compassion. But what are the consequences of one business offering way above market salary for a given position? What happens if a better man for the job shows up? At such a market premium, the business could reasonably hire the slightly better person and terminate the other person, but then this is hardly "compassionate." And will employees remain with the company even if they're no longer in love with their job because the salary is substantially higher than a comparable position elsewhere? Does this serve or hurt the company? I'm not really criticizing or supporting this move. I'm just really curious how it will play out.

lotsofmangos 12y ago
Well, Ford didn't do too badly. As for what if someone better shows up, well if you were swapping out staff every time someone you thought was better showed up, irrespective of money, you would kill off your business. Stability is more important than chasing some vision of perfection if you are wanting to get stuff done.
- joshpadnick 12y ago
  That's a good point. Part of me is trained to think about this like an economist (the subject of one of my bachelor's), but in the end I really hope that human compassion triumphs and this proves to be a win-win. I'm routing for Mr. Price.
  - lotsofmangos 12y ago
    Ford wasn't doing it to be nice. Ford was trying to cut turnover as that was costing him loads.
    - loco5niner 12y ago
      And likely getting better quality, harder workers in the process.
  - azernik 12y ago
    Even economists have to take into account transaction costs. Hiring someone new is often a fairly costly transaction.
    - randomfool 12y ago
      I frequently worry that the measurement of success is shrinking from how a community prospers to how well an individual prospers. As low-wage workers commute from distant communities and we become isolated in our own worlds of gated communities and like-minded netizens, there's little incentive to improve our surroundings. It's tough to quantify the happiness and peace of mind that I get from experiencing a well cared-for community.
- prostoalex 12y ago
  Ford was more or less forced to do it due to technological advantage he developed (assembly line) and increase in amount of training an efficient worker would have to go through. There are businesses that survive on innovative processes (and highly trained workers to follow those processes) and those that survive on dumbed-down any-idiot-should-be-able-to-follow-this processes. In some industries you get an edge by choosing the former, in some you have to choose the latter.
rejschaap 12y ago
Things work out much better if you start out with assuming good will from both parties. With that I mean the employee wants to do a good job and the employer wants to treat his employees well. I think the employer in this case made a good start by giving the employee a decent salary. It doesn't make much sense to think this is some scheme to swap them out for 'better' employees. Also, don't forget the kind of jobs this will affect. It will mostly be low skilled work. The upside of replacing this type of employee with someone who is a little bit better is just not worth the trouble. The 'golden handcuffs' argument doesn't make a lot of sense either. Sure, it would be hard to give up a seriously overpaid job. But just think of the opportunities it gives you. You could save up a lot of money to start your own business. You could invest in your own education so you are able to land a higher paid job. That's all probably not even interesting because the company from the article treats its employees really well, so they are probably willing and able to help you with any ambition you might have.
- srtjstjsj 12y ago
  People strongly favor secure income over risk, once they have the income. risk-taking is far greater before the safe option has actually started delivering. The HN crowd (especially founders) probably skews toward risky, but that's not the general mode of behavior. And people are pretty good at spending the delta of $70k-$50k/yr, especially on things like mortgages that have a many-year lock-in, or past accumulated debt. This is a different story from the webtech world where a $100K to $200K (or even $1M+) bump creates financial independence (not just security) in the near term.
Shivetya 12y ago
It just is the situation taken to an extreme. While people should be treated fairly its is not wise to treat all jobs as equal. I am all for his reducing his pay to what he deems proper, whether it 75k, twice that, or five times that. I do think it a bit of a off the cuff stunt to move the whole office to one pay rate. I would not feel all that impressed with the idea if I were a senior level in my career and earning 75k and suddenly the mail boy makes 75k or the level 2 call taker does
- biomene 12y ago
  > I would not feel all that impressed with the idea if I were a senior level in my career and earning 75k and suddenly the mail boy makes 75k or the level 2 call taker does I would understand your feeling if it implied you being somehow less well off, or having less chances of being promoted in the future, etc. But you seem to dislike the idea of other people being better off, period. I don't see what you gain from the mail boy being poorer.
  - fsniper 12y ago
    I think this is the way of thinking in capitalism. "I have been working my ass off to become what I am now, I have paid college, and now one with lower try is making as much as me. That's not fair." Also this leads to another hidden thought of "That mail boy is currently getting the money which I should have been making". Well I can't say thought first one is not justified but the second one is really absurd.
    - moopling 12y ago
      Hard work may give you an edge over other people in the same job role, so seniority way be seen as somewhat correlated with hard work within a position, but across job roles pay is much more dependent on other factors for instance the opportunities provided to you by your wealth, race and sex to name a few. I'm of the opinion that just because someone is paid less, doesn't mean they work less hard, and I don't think it fair to begrudge people their pay for quite possibly just not being born with the same silver spoon. P.S: Not to imply that wealth, race, and sex don't also hinder you within a job role, but I think that it's probably even more prevalent across them.
brianfitz 12y ago
For the CEO, success appears to be defined as keeping the minimum wage across the entire pool of job candidates set above $70k. The easiest move is the first shift to raise everyone's existing salaries as this is based on previous staffing behavior. The test will be if they have the discipline to continue hiring as they have previously going forward. For example, if they were hiring new college grads out of school at $40k, will the continue to do so at the same pace? Will they continue to hire new college grads at all? I mention this because if they don't, they won't meet the CEO's stated goal -- rather they will slowly shift their workforce to weed out those with market rates below $70k. The only way to prevent this will be to ask managers to purposefully hire candidates with less experience while simultaneously handing them a larger hiring budget.
- srtjstjsj 12y ago
  > purposefully hire candidates with less experience that's not required at all. Only the budget is needed.
imcnally 12y ago
> a better man You mean person.
- loco5niner 12y ago
  Here's the part of the quote you ignored. Notice he says person twice. > What happens if a better man for the job shows up? At such a market premium, the business could reasonably hire the slightly better person and terminate the other person, but then this is hardly "compassionate."
  - imcnally 12y ago
    Quoting one thing is not ignoring another.
    - loco5niner 12y ago
      The problem is you were claiming discrimination where none existed. In that, yes, you were ignoring the other.
      - imcnally 12y ago
        I implied it, but didn't claim it. Using the word "man" in a sentence where the subject is also referred to as "person" is at least a copy editing mistake. Also, you have no idea if he was discriminating. I don't think he was, since I'll give him the benefit of the doubt. But you don't know either. The point is: people should be conscious of the words they use. Accidentally or not.
        loco5niner 12y ago
        This probably just comes down to your considering political correctness to be important and my considering political correctness to be overblown.

lotsofmangos 12y ago

Well, Ford didn't do too badly. As for what if someone better shows up, well if you were swapping out staff every time someone you thought was better showed up, irrespective of money, you would kill off your business. Stability is more important than chasing some vision of perfection if you are wanting to get stuff done.

joshpadnick 12y ago
That's a good point. Part of me is trained to think about this like an economist (the subject of one of my bachelor's), but in the end I really hope that human compassion triumphs and this proves to be a win-win. I'm routing for Mr. Price.
- lotsofmangos 12y ago
  Ford wasn't doing it to be nice. Ford was trying to cut turnover as that was costing him loads.
  - loco5niner 12y ago
    And likely getting better quality, harder workers in the process.
- azernik 12y ago
  Even economists have to take into account transaction costs. Hiring someone new is often a fairly costly transaction.
  - randomfool 12y ago
    I frequently worry that the measurement of success is shrinking from how a community prospers to how well an individual prospers. As low-wage workers commute from distant communities and we become isolated in our own worlds of gated communities and like-minded netizens, there's little incentive to improve our surroundings. It's tough to quantify the happiness and peace of mind that I get from experiencing a well cared-for community.
prostoalex 12y ago
Ford was more or less forced to do it due to technological advantage he developed (assembly line) and increase in amount of training an efficient worker would have to go through. There are businesses that survive on innovative processes (and highly trained workers to follow those processes) and those that survive on dumbed-down any-idiot-should-be-able-to-follow-this processes. In some industries you get an edge by choosing the former, in some you have to choose the latter.

rejschaap 12y ago

Things work out much better if you start out with assuming good will from both parties. With that I mean the employee wants to do a good job and the employer wants to treat his employees well. I think the employer in this case made a good start by giving the employee a decent salary. It doesn't make much sense to think this is some scheme to swap them out for 'better' employees. Also, don't forget the kind of jobs this will affect. It will mostly be low skilled work. The upside of replacing this type of employee with someone who is a little bit better is just not worth the trouble. The 'golden handcuffs' argument doesn't make a lot of sense either. Sure, it would be hard to give up a seriously overpaid job. But just think of the opportunities it gives you. You could save up a lot of money to start your own business. You could invest in your own education so you are able to land a higher paid job. That's all probably not even interesting because the company from the article treats its employees really well, so they are probably willing and able to help you with any ambition you might have.

srtjstjsj 12y ago
People strongly favor secure income over risk, once they have the income. risk-taking is far greater before the safe option has actually started delivering. The HN crowd (especially founders) probably skews toward risky, but that's not the general mode of behavior. And people are pretty good at spending the delta of $70k-$50k/yr, especially on things like mortgages that have a many-year lock-in, or past accumulated debt. This is a different story from the webtech world where a $100K to $200K (or even $1M+) bump creates financial independence (not just security) in the near term.

Shivetya 12y ago

It just is the situation taken to an extreme. While people should be treated fairly its is not wise to treat all jobs as equal. I am all for his reducing his pay to what he deems proper, whether it 75k, twice that, or five times that. I do think it a bit of a off the cuff stunt to move the whole office to one pay rate. I would not feel all that impressed with the idea if I were a senior level in my career and earning 75k and suddenly the mail boy makes 75k or the level 2 call taker does

biomene 12y ago
> I would not feel all that impressed with the idea if I were a senior level in my career and earning 75k and suddenly the mail boy makes 75k or the level 2 call taker does I would understand your feeling if it implied you being somehow less well off, or having less chances of being promoted in the future, etc. But you seem to dislike the idea of other people being better off, period. I don't see what you gain from the mail boy being poorer.
- fsniper 12y ago
  I think this is the way of thinking in capitalism. "I have been working my ass off to become what I am now, I have paid college, and now one with lower try is making as much as me. That's not fair." Also this leads to another hidden thought of "That mail boy is currently getting the money which I should have been making". Well I can't say thought first one is not justified but the second one is really absurd.
  - moopling 12y ago
    Hard work may give you an edge over other people in the same job role, so seniority way be seen as somewhat correlated with hard work within a position, but across job roles pay is much more dependent on other factors for instance the opportunities provided to you by your wealth, race and sex to name a few. I'm of the opinion that just because someone is paid less, doesn't mean they work less hard, and I don't think it fair to begrudge people their pay for quite possibly just not being born with the same silver spoon. P.S: Not to imply that wealth, race, and sex don't also hinder you within a job role, but I think that it's probably even more prevalent across them.

brianfitz 12y ago

For the CEO, success appears to be defined as keeping the minimum wage across the entire pool of job candidates set above $70k. The easiest move is the first shift to raise everyone's existing salaries as this is based on previous staffing behavior. The test will be if they have the discipline to continue hiring as they have previously going forward. For example, if they were hiring new college grads out of school at $40k, will the continue to do so at the same pace? Will they continue to hire new college grads at all? I mention this because if they don't, they won't meet the CEO's stated goal -- rather they will slowly shift their workforce to weed out those with market rates below $70k. The only way to prevent this will be to ask managers to purposefully hire candidates with less experience while simultaneously handing them a larger hiring budget.

srtjstjsj 12y ago
> purposefully hire candidates with less experience that's not required at all. Only the budget is needed.

imcnally 12y ago

> a better man You mean person.

loco5niner 12y ago
Here's the part of the quote you ignored. Notice he says person twice. > What happens if a better man for the job shows up? At such a market premium, the business could reasonably hire the slightly better person and terminate the other person, but then this is hardly "compassionate."
- imcnally 12y ago
  Quoting one thing is not ignoring another.
  - loco5niner 12y ago
    The problem is you were claiming discrimination where none existed. In that, yes, you were ignoring the other.
    - imcnally 12y ago
      I implied it, but didn't claim it. Using the word "man" in a sentence where the subject is also referred to as "person" is at least a copy editing mistake. Also, you have no idea if he was discriminating. I don't think he was, since I'll give him the benefit of the doubt. But you don't know either. The point is: people should be conscious of the words they use. Accidentally or not.
      - loco5niner 12y ago
        This probably just comes down to your considering political correctness to be important and my considering political correctness to be overblown.