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I always appreciate your transparency and believe that you're helping drive our industry forward. I often search for ideas on how to help within my area of infl

by Todd 11y ago

I always appreciate your transparency and believe that you're helping drive our industry forward. I often search for ideas on how to help within my area of influence. The closest I've found is Stack Exchange's salary matrix, and the related approach at Fog Creek. I think publishing salaries has several benefits. For one thing, it removes the used car salesman approach to hiring. One result, which is more important, is that it can help eliminate wage disparity due to differences of gender or level of negotiating skills. It can also help prevent the corrosive effects that can occur if people do find out actual numbers (the morale-sapping that you discuss). The problem with this approach, and one I'm trying to figure out is, what about the non-developer jobs? Assumedly, each group gets their own matrix. But if the admins can browse the matrices of the other groups, like the development team's, then there can be a similar corrosive effect. One option is to only discuss the salary matrix within your group and with HR. But then we're back to a different version of the tired old story. (Don't discuss the matrix outside of your group!) This leads me to believe that it's best to be completely open. It might also serve as an incentive for people to make an effort to grow into different areas. Any ideas appreciated.

ljoshua 11y ago
At the firm that I work at everything is in the open, even between groups, and it works very well. It is a formula-based compensation given your department (basically consultants and back-office) and stated level. With that, I know or can calculate exactly how much my manager makes, how much an entry level HR employee makes, and how much the CEO makes. I love it because it removes any problem with politics or shadowy discussions, and I know what I can expect when a promotion comes. The only downside is that it leaves the firm with little leverage when it comes to compensation: I can't simply get a bump without a promotion, nor are there extra bonuses that can be given out either for hiring or retaining. (This has its benefits as well however.)
- Todd 11y ago
  That's enlightening and encouraging. A formula-based/matrix approach might make it more acceptable because it isn't personal. One thing I haven't seen is how to handle COLA. I'm sure that can also be added as an additional factor, though.
  - ljoshua 11y ago
    (Late to the reply, sorry.) COLA is addressed on a per office basis. Our headquarters is in a relatively inexpensive large city, and so other offices in pricier places like SF or DC get a blanket COLA adjustment, with the percentage bump based on some particular survey's index or something.
- iamnafets 11y ago
  I worked for a company like this. It irritated my VP who had her hands tied when it came to negotiation (like you mention). I ended up switching companies for an 80% bump. These companies work really well for the median employee for all of the reasons you mention - especially the air of transparency. But I think it makes it nearly impossible to properly compensate top talent.
cpeterso 11y ago
Glassdoor.com seems to have fairly accurate salary reports across different companies, jobs, and geographies.
- tptacek 11y ago
  Glassdoor has never been accurate about any firm I had firsthand knowledge of.
  - mathattack 11y ago
    I've seen it be remarkably accurate, but that was for a "Mostly cash, limited bonus" environment. I think one of their sources is H1B filings, which can be very accurate for those types of jobs. It misses equity and outsize bonuses.
    - fredkbloggs 11y ago
      First of all, you should always value equity at zero. Neither your landlord nor the guys at the farmers' market want your stock certificates, which are overwhelmingly likely to end up worthless (if they aren't already). Second, most companies don't pay bonuses. Those that do usually have a bonus pool that depends in some way on the company's success in the marketplace, and they can almost always abolish bonuses at management's discretion. A good rule of thumb is that the more you need a bonus in a given year, the less likely it is that there will be anything in the pool. Don't even think of budgeting for a bonus. Ever. Knowing what you're actually going to get as long as they keep you on is the right information. The other thing you'd want, which is very hard to get, is how likely they are to keep you on. For public companies you can read the 10Qs and look for news about layoffs, but it's much harder to discern how secure you will be at a smaller/private employer. HTH. Signed, A Veteran of 2001
      - tptacek 11y ago
        Serious question: if you value equity at 0, then (ceteris paribus) given a choice between (1) an offer at $150,000 and 50 basis points and (2) an offer at $150,100 and 0 basis points, you should choose option (2). Given that: why should any employer offer equity?
aantix 11y ago
>I think publishing salaries has several benefits. For one thing, it removes the used car salesman >approach to hiring. One result, which is more important, is that it can help eliminate wage >disparity due to differences of gender or level of negotiating skills. If you publish salaries, then aren't you just shifting the negotiations to which salary bucket you deserve to belong to? So instead of absolute money, now we're negotiating with fluent tiers based on other employees salaries (John makes 200K and I'm closest to John in terms of ability, so let me convince you how similar I am to John). It will always comes back to demonstrating your value.As a developer, you're capable of creating logic that can literally scale to bring millions of dollars of value to a company. Stop talking about PHP. Stop talking about Rails. Start talking about the money you make for your company. Who care about the middle-aged white male programmer who's too introverted to ask for a great compensation? Who cares about the woman who's too timid to assert herself? They're their worst enemy. And it's not your problem to wait for the rest of the pack to get their negotiation-shit together. More money on the table for you. There's so many opportunities for devs right now (take a look at the recruiter emails sitting in your inbox). Learn a little bit of negotiation skill, and you're better than 80% of your peers. Demand what you deserve. Take your kids on an amazing adventure. Buy the home you've dreamed of. Save some money and only work 6 months out of the year. And don't apologize.
titanomachy 11y ago
I just looked at the StackExchange salary matrix that you mentioned (from 2011)... Under "skills" they include "modem-whistling": > Able to emulate a 1200 baud modem using just your mouth (with error correction protocol) well enough to upload a GIF picture to Compuserv :D

by Todd 11y ago

ljoshua 11y ago

At the firm that I work at everything is in the open, even between groups, and it works very well. It is a formula-based compensation given your department (basically consultants and back-office) and stated level. With that, I know or can calculate exactly how much my manager makes, how much an entry level HR employee makes, and how much the CEO makes. I love it because it removes any problem with politics or shadowy discussions, and I know what I can expect when a promotion comes. The only downside is that it leaves the firm with little leverage when it comes to compensation: I can't simply get a bump without a promotion, nor are there extra bonuses that can be given out either for hiring or retaining. (This has its benefits as well however.)

Todd 11y ago
That's enlightening and encouraging. A formula-based/matrix approach might make it more acceptable because it isn't personal. One thing I haven't seen is how to handle COLA. I'm sure that can also be added as an additional factor, though.
- ljoshua 11y ago
  (Late to the reply, sorry.) COLA is addressed on a per office basis. Our headquarters is in a relatively inexpensive large city, and so other offices in pricier places like SF or DC get a blanket COLA adjustment, with the percentage bump based on some particular survey's index or something.
iamnafets 11y ago
I worked for a company like this. It irritated my VP who had her hands tied when it came to negotiation (like you mention). I ended up switching companies for an 80% bump. These companies work really well for the median employee for all of the reasons you mention - especially the air of transparency. But I think it makes it nearly impossible to properly compensate top talent.

cpeterso 11y ago

Glassdoor.com seems to have fairly accurate salary reports across different companies, jobs, and geographies.

tptacek 11y ago
Glassdoor has never been accurate about any firm I had firsthand knowledge of.
- mathattack 11y ago
  I've seen it be remarkably accurate, but that was for a "Mostly cash, limited bonus" environment. I think one of their sources is H1B filings, which can be very accurate for those types of jobs. It misses equity and outsize bonuses.
  - fredkbloggs 11y ago
    First of all, you should always value equity at zero. Neither your landlord nor the guys at the farmers' market want your stock certificates, which are overwhelmingly likely to end up worthless (if they aren't already). Second, most companies don't pay bonuses. Those that do usually have a bonus pool that depends in some way on the company's success in the marketplace, and they can almost always abolish bonuses at management's discretion. A good rule of thumb is that the more you need a bonus in a given year, the less likely it is that there will be anything in the pool. Don't even think of budgeting for a bonus. Ever. Knowing what you're actually going to get as long as they keep you on is the right information. The other thing you'd want, which is very hard to get, is how likely they are to keep you on. For public companies you can read the 10Qs and look for news about layoffs, but it's much harder to discern how secure you will be at a smaller/private employer. HTH. Signed, A Veteran of 2001
    - tptacek 11y ago
      Serious question: if you value equity at 0, then (ceteris paribus) given a choice between (1) an offer at $150,000 and 50 basis points and (2) an offer at $150,100 and 0 basis points, you should choose option (2). Given that: why should any employer offer equity?

aantix 11y ago

>I think publishing salaries has several benefits. For one thing, it removes the used car salesman >approach to hiring. One result, which is more important, is that it can help eliminate wage >disparity due to differences of gender or level of negotiating skills. If you publish salaries, then aren't you just shifting the negotiations to which salary bucket you deserve to belong to? So instead of absolute money, now we're negotiating with fluent tiers based on other employees salaries (John makes 200K and I'm closest to John in terms of ability, so let me convince you how similar I am to John). It will always comes back to demonstrating your value.As a developer, you're capable of creating logic that can literally scale to bring millions of dollars of value to a company. Stop talking about PHP. Stop talking about Rails. Start talking about the money you make for your company. Who care about the middle-aged white male programmer who's too introverted to ask for a great compensation? Who cares about the woman who's too timid to assert herself? They're their worst enemy. And it's not your problem to wait for the rest of the pack to get their negotiation-shit together. More money on the table for you. There's so many opportunities for devs right now (take a look at the recruiter emails sitting in your inbox). Learn a little bit of negotiation skill, and you're better than 80% of your peers. Demand what you deserve. Take your kids on an amazing adventure. Buy the home you've dreamed of. Save some money and only work 6 months out of the year. And don't apologize.

titanomachy 11y ago

I just looked at the StackExchange salary matrix that you mentioned (from 2011)... Under "skills" they include "modem-whistling": > Able to emulate a 1200 baud modem using just your mouth (with error correction protocol) well enough to upload a GIF picture to Compuserv :D