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Eldragon posted:The number of people who overestimate their worth and abilities probably exceeds the number of people getting sweetheart deals. In this scenario the boss points out that Alice is 30% more effective than Bob because of the way she handled x, y and z projects. They offer Bob a raise of x where x is whatever they feel is worth to retain him. He can then take it or leave it. You know, a proper negotiation. In your scenario why would the company feel compelled to match Bob's salary to Alice's if they felt he wasn't worth it? If they are willing to pay that much to keep him then clearly he is worth it. I think the much more plausible and commonplace scenario is one in which Alice doesn't know what Bob makes and thus can't accurately judge her worth to the company in comparison. Whatever offer they make involves a leap of faith in which she tries to determine her worth with no outside reference points, allowing the company to pay her a much closer salary to Bob. I know anecdotes aren't data, but I actually have a friend who found out that his salary was several percentage points lower than someone who joined the company at the same time as him and who came from the same educational background. When he brought this up management quickly moved to rectify the 'unfortunate error, which they don't know how it could have happened.' In a lot of companies there are illegal corporate policies against talking about pay which would have kept my friend in the dark and allowed the company to short him several thousand dollars a year simply because he had no way to fine tune what he was worth. edit: Really if you subscribe to Free Market economics at all, then allowing people to discuss salary or even mandating the release of all salary information makes sense because the system relies on the actors having accurate knowledge. All preventing the flow of information does is give bosses an unfair advantage in bargaining, which is why a lot of companies are so quick to act against people who do so. cafel fucked around with this message at 22:59 on Apr 15, 2014 |
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Apr 15, 2014 22:48
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Eldragon posted:I agree that your scenario is the more rational one. But people just are not rational. Petty jealousy, self-doubt, inflated sense of self-worth, etc. would rapidly culminate into a lot of infighting and arguments over pay. Eventually management would just have to pay everyone the same just to make the complaining come to an end. Well even if I were to agree that things would play out your way, I fail to see how uniform gains in employee salary offset by decreased profits is a bad thing. Employees forcing employers to pay them as much as they possibly can instead of employers separating employees in order to get away with paying them as little as they possibly can is like music to my ears. Unless you're going to try to take this in the direction that this will lead to widespread bankruptcy, in which case I thing your taking the irrationality of management just a few steps too far.
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Apr 16, 2014 00:52
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wateroverfire posted:Why do you think it would happen this way, rather than compressing the top of the pay band because employers "want to preserve an appearance of fairness" or whatever? Because they need to retain their best talent. If they're not paying their most effective employees what they're worth than those employees can always find a company with more effective management that will pay them that much. And I'm sure that there would be instances of lovely management that wouldn't be able to handle their employees and continually lose their top talent, but then again those kind of lovely working environments already exist. Legislating stuff in a such a way as to make things easier for incompetent management or greedy management doesn't sound like as good of an option as legislating stuff in order for more transparency and a better worker bargaining position.
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Apr 16, 2014 01:33
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wateroverfire posted:That's assuming things work the way they work now, which they won't necessarily. If a supposedly stellar employee wants to jump ship to another company for a raise, that company can point to the pay database and say "sorry, this information is public and hiring you at X wage would be problematic." where before they might have met her requirement and stayed quiet about it. This picture you paint is of an incredibly bleak universe in which all management is completely incompetent and unable to effectively and efficiently deal with their workforce. The companies that have a rewarding environment and are able to tell their employees that no, they're not going to give them that raise because it's unreasonable and if they don't like it they're free to find employment elsewhere, will be able to lure away potentially more qualified employees with offers of better wages. I mean, given today's overcrowded labor market it's not as if the employees have a ton of leverage to enforce unreasonable demands.
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Apr 16, 2014 20:34
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PT6A posted:Or the employer can do the same thing, since it's in their best interest to pay their top performers well in order to retain them. The employer is not looking to pay their top performers well. They are simply looking to pay them the minimum amount which will keep them around. Unions and employees are looking to be paid as much as possible, to the point that any more and it wouldn't be worth it to retain them. Sometimes these numbers naturally line up very well and sometimes they don't and having a union around to support you can be beneficial.
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Apr 16, 2014 21:34
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WhiskeyJuvenile posted:News to me. Well based on the fact that the National Federation of Federal Employees, which is affiliated with the AFL-CIO, has 100,000 members throughout the federal government, I'm going to say that's because it's not true. I think icantfindaname might be misremembering the law about federal workers being unable to strike, which doesn't preclude them from forming a union, but certainly does limit their collective bargaining rights.
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Apr 17, 2014 09:44
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