What are the cons of government jobs

Should I encourage my employees to share their salaries with each other?

Transparency of things like salaries generally leads to more fairness. It also forces employers to base salaries on more objective (and open) justifications for setting salaries, as opposed to who is the best negotiator, nepotism, or other potentially corrosive practices.

This can work best in environments where performance is very objective or subjective. For example, my very first job, Taco Bell, would pay a certain bonus if you could pass a test that proves you memorized food ingredients and amounts. This is because a high percentage of the efficiency of a given restaurant location has to do with how quickly and accurately the staff can make food to order in the same way each time. In this case it is clear what the incentive is for both the employer and the employee, and under what conditions it was therefore easy for a boss to give me an "automatic" raise on the basis of efficiency gains.

In places where performance is more subjective, simply having a process for determining salaries and bringing that process up for discussion to some extent can add to a sense of fairness. Organizations operating as co-operatives (where the employees also own the business) are examples of where the incentives are all aligned and generally good at handling them.

If you go too far with a measurement-focused approach, you can fall into the trap of reducing everything to KPIs that only motivate some employees and exclude others. Such an approach also usually focuses on efficiency rather than other factors that can be valuable to the company and its employees, such as culture, design, customer satisfaction, etc.

Fairness is important, regardless of which approach is the right one in the specific case. If you focus on fairness, you can't worry too much about jealousy. You may have some people who are jealous but as long as the path is from where they are to where they want to be is free (and it's not an old boys club where the path is free, but you have to, too kissing a lot of ass unnecessary) then you can always attribute jealous employees to this process.

In case I haven't already said so, I don't think there is ever any downside (for the staff) to opening the process. This can reveal any unfair practices that may exist, even if the employer is not trying to be unfair.

I've seen transparency work. I think the fear that it's a slippery slope to rising salaries or complaining employees is just silly: the company can always say "no". In this case, transparency only fails if you don't also Publish a list of fair, reasonable criteria for determining salaries that can be largely objectively measured.

I also had a personal experience in which one employee found out that he was paid significantly less than another employee who (with the approval of all colleagues and superiors) did a worse job and had not been there for that long was just as productive . The unfortunate response from the underpaid employee was, "Well, it's not going to change so there's nothing to negotiate here."

I didn't find out about this situation until the senior manager was later replaced - not because of that situation, but that was one of the things that came out of it. As a result, the company established a more open process for setting entry and salary increases. While individual salaries were never disclosed, managers made sure they had "real" reasons to pay people for what they did, so employees would discuss their salaries (which is pretty inevitable) and ask questions on theirs Supervisors were able to discuss the standards for setting salaries as well Take direct action that the employee could take to increase their salary which practically solved these problems.

StackExchange itself publishes its remuneration determination strategy (December 2015 update - this link is broken, but this is kind of a close equivalent). I'm not trying to promote StackExchange just because we use their services. They're simply one of the best examples of how a company can be run more openly, and they actually make the compensation strategy visible to the whole world.

Ternary software (now closed, but the spiritual predecessor of Holocracy One) also had an open salary strategy. Everyone knew everyone else's salary and the criteria that were in it, but things didn't start that way. In fact, by publishing the criteria for setting salaries, the individuals who put in place a more open system not only made money a non-issue, but also lowered their own base salaries and (based on the group agreement) based compensation of the good realigned for the success of the company and the long-term growth and motivation of the employees.

The result was that the group decided what was important to the life and success of the company and gave employees a clear direction for increasing their salary if they so desired (believe it or not, it is not always the highest priority for employees). When employees did bigger and better things, the company did bigger and better things too, so it was a breeze to give someone a bonus when they were clear and had a direct positive impact on the bottom line.

Now you asked if you should encourage employees to share their salaries. The transition from secrecy to transparency takes time. I would say that gangbusters and everyone's encouragement tomorrow Switching to transparency, likely to attract a few glances and cause confusion - probably not a good idea. You will almost certainly hear all the fears you can imagine why this isn't working.

The trick is to do it slowly. Different companies (and corporate cultures) take different amounts of time to make such a transition (and if they choose not to make that transition, it might be fine, too). So take it one step at a time. Maybe suggest a small change. Maybe talk about slowly disclosing salary and only making a handful of changes per quarter. Perhaps start with a discussion of how compensation should be set and start getting ideas. Yes, of course you will find the people who say, "Well, I make $ 5,000 in sales for the company every month, and so I should be getting that exact amount") but this is unrealistic and impractical and such in some cases companies do not work, grow or improve. People who want to make the exact money they bring in should become independent contractors - they can live and die with exactly what money they bring in the door, what they want.

I think one of the most important things here is that you are just as transparent about how and when You plan this transition as you plan when you achieve transparency. Any corporate culture will inevitably decide that its level of comfort is a little different from other places, and it's okay if they don't end up where you hope they will. These ideas go against many social norms and it will be some time before a company decides to transition.

A completely different way to do this could be to simply announce a bonus for a particular performance metric, have others work with the business owners to suggest additional, incremental changes, and let the dynamics of that process guide you.

weronika

Fantastic answer, I totally agree. In particular, you are right that even if in the current working environment Employees talking about their salaries can cause conflict, this can be seen as a clear sign that a change in workplace policy / environment is warranted.

Jefflunt

@weronika - absolutely. Even if your workplace today is full of nepotism and unfair practices is and exposing it can lead to scandals and pain in the short term (you could even lose valuable people) Fixing the Problem makes the difference and it pays off.

mhoran_psprep

Management does not owe the employee any justification of the salary level. Just because employees want openness doesn't mean management / owners allow it.

Jefflunt

@mhoran_psprep - that's obviously true. From a legal point of view, the owners "own" the company and use its resources as they see fit. You are also right that management "owes" no justification to the employee. Because of this, I've included real-world examples that don't just show where it's is working but also the additional potential benefits of such a directive. I think there is real evidence against the idea that this "never works".

IDrinkandIKnowThings

This only works if the salary is shared anonymously. Once names are associated with salary, it is about the person, not the salary. While the school principal is healthy, the practice fails.