And the CEO of the year award goes to....

PHeller wrote:

racerdave600 wrote: My old company paid exceptionally well. Basic soldering skilled positions were paid at $25 an hour, where they average around here is $11 to $15 an hour. So last year when our company moved and no one went with it, those same people were screwed. They had all bought far above their pay scale and many were forced to start liquidating their assets.

Sounds as though the company should have put some effort into educating their workforce about business trends and salaries. Nobody blamed the tech companies of the .com bubble for paying unrealistic and unsustainable high salaries, and many people lost their jobs, homes, cars, etc, but today those people are probably better for it as they better understand the risk of getting in over your head. It's not like people don't do that on regular salaries either. Think of how many people depended on a common salary in the auto industry? Or coal? Or steel?

LOTS of people in the oil industry (drilling side especially) who were making well over half their money on overtime pay the last 5-7 years. Did they save the extra? Not the guys I know. They bought new trucks. Big houses. If they're lucky enough to be still working now, there is no OT, and they're hurting badly.

So, the study he read (which I have read also) said people are happier if they make $75K.

I wonder why he stopped at $70K.

Tease.

The math presented in the article just doesn't work. I don't mean the increase I mean the current state of the company.
Facts from article. Average salary over 120 people 48k = 5.76M 30 peoples salary will specifically double meaning their salary is 35k. 70 people will increase pay meaning 50 people make >70k, 40 make >$35,001.

30x35k+40x35,001+50x70,001= 5.95M/120=49.5k avg not including CEO and assuming 50 people make $1 over 70k.

If we include the CEO at "nearly 1M" it is impossible to have an average salary of <50k and the other conditions be met.

Assuming though the starting conditions that the article states if he basically makes all employees make 70k so min and average are 70k you get an increase payrol of 2.62 mil which subtracting out "nearly 1M" leaves ~1.7M which is strangely enough 80% of 2.2M.

I hate the US media. I suspect some reported things said by the company are wrong. I'm also wondering if the numbers HR provided and the CEOs intentions involved total compensation vs real pay.

nocones wrote: I hate the US media.....

https://www.youtube.com/watch?v=GH68bSJXGE8

Keep in mind too that what an employee makes is quite a bit less than the actual cost to the employer. So do those figures take that into account?

racerdave600 wrote: Keep in mind too that what an employee makes is quite a bit less than the actual cost to the employer. So do those figures take that into account?

Hard to say.

Usually, the word "salary" refers to base salary, but "payroll" refers to gross payroll costs including the load (various costs).

Since the article says "average salary" I am assuming it is base salary, which would mean the numbers are much worse.

The owner's salary is probably not included. It would skew things a lot worse.

In fact, if be surprised if he actually has a $1 mil salary. It just wouldn't be smart to do that. It is much more likely that he has a $100K salary, plus draws, options, etc.

But, he wouldn't be easily able to give back those things if they were not in the form of a salary.

Doesn't matter. My point (and Nocones') is that the math doesn't work.

Wow, it's a touchy subject here. Who knew?

I usually come here for enlightening discussions, but this may be the most depressing thread I've ever seen on this board...geez, take it at face value and move on.

all I can add to this conversation.. I once offered here what I make an hour.. and got flamed for it. If this CEO can make this work, then he is all the better for it. Happy employees are productive ones who do not jump ship at the merest thought of greener pastures... so little turnover and no training.

I wish him all the luck in the world and I really do hope it works.

and BTW.. if you really think that you can negotiate a good salary on your own at a big corp.. there are dozens of people in line behind you that are just as good as you, who are willing to work for less

Then that doesn't make you a very rare commodity, does it?

Duke wrote: Then that doesn't make you a very rare commodity, does it?

Unfortunately, not every lowly pleb gets to be a very rare commodity. In a world of billions of people, being your own special little flower that stands out is fairly impractical. Which of course, in fairness, dictates your pay as you said.

However, where I disagree with you is this:

A guy who picks tomatoes for 8 hours gets done his shift, goes home, has a beer, eats dinner, goes to bed. He has responsibility for a couple hundred pounds of tomatoes. The guy "watching the computer" may have responsibility for thousands of tons of tomatoes and a large network of interconnected people and equipment that is dependent upon the key players to make sure it integrates smoothly. Even off the clock, he has to worry about a hundred details that need to be right the next morning. He's probably got a company cell phone that he's not allowed to turn off. Which is a "harder" job?

I've actually found this to rarely be the case. You're making a strawman argument to fit your biases. And for the record, having the responsibility to click a button does not make you worth more than the person doing the actual work. In regards to value, WITHOUT the guy in the field, the guy in the office has no job. But the guy in the field can pick and sell those tomatoes with or without the guy in the office. So who is more important? Alfa said it best, and I NEVER agree with Alfa on much at all!

What is valued most in the market place is either rarity or productivity. As I said in the last one of these Woody-Guthrie-esque threads, unskilled labor is common and easy to come by. It breeds itself! 99.9% of the people on the planet are born capable of providing unskilled physical labor. So that's not rare. If everybody can do the valuable jobs, WHY DON'T THEY? I guess da man be keepin them down.

I'm on the same page as you. I am not arguing for people to just magically get paid more, but I do argue for people to be paid enough to live. At the same time, a corporation CAN pay its employees more if their CEO's are taking home millions upon millions of dollars annually. Surprisingly enough, it works in the companies favour to drive greed, as it keeps the power in the hands of the few, so the cycle can repeat itself. Just because our western society has a GOOD standard of living overall doesn't mean it couldn't be better. WHY does (insert CEO here) earn $20mil? Why not earn $5mil and have that other $15mil spread amongst the employees.

Understand, I WILL be a 1.5%'er in my lifetime. So its not like I don't have skin in the game, I am (in my opinion) a successful individual. That doesn't mean I don't have empathy for those who truly can not get past having a $12/h job due to a number of reasons (note, laziness is not a reason, however, for our society to function properly, and due to the rights we have, they have to be taken into consideration whether we like it or not).

What about productivity? By that we mean value added to the venture. Sure, there are no tomatoes if the guys in the field don't pick them. But each laborer only adds a few hundred pounds of tomatoes in value to the system. But the guy "watching the computer" may be in charge of logistics and is responsible for moving the thousands of aggregate tons of tomatoes to market. Say all the noble laborers in the field struggle mightily and deliver their harvest. What do they have? A large pile of rotting tomatoes. Are you honestly trying to convince me that the guy in the "watching the computer" logistics role doesn't add something of more value?

Refer to my prior answer. Is the guy watching the computer earning the company more money than if each person picked and sold the tomatoes themselves? And if so, how much salary does that justify? At the end of the day, should his "aggregate" based on other's work make him more valuable? Why? Without the tomato pickers, he would be jobless. Seems to me the tomato pickers hold significantly higher value.

"Now if you know what you're worth then go out and get what you're worth. But ya gotta be willing to take the hits, and not pointing fingers saying you ain't where you wanna be because of him, or her, or anybody!"

---Rocky

In reply to HiTempguy:

I'm not gonna argue much with you about farm methods and commodities pricing, but I will say this...

You're crazy if you think the guys who pick tomatoes can sell them.

Before anyone gets more obtuse about the thousand ways that the article's company is way out of line paying its employees well, consider the following:

This is a tech company in Seattle. Seattle is really expensive and $70k is a typical starting wage in that industry. Good people are going to get poached by one of the major players if compensation does not align with competitors.

In reply to Mitchell:

For clerical???

Sine_Qua_Non wrote: Wow, it's a touchy subject here. Who knew?

stuart in mn wrote: I usually come here for enlightening discussions, but this may be the most depressing thread I've ever seen on this board...geez, take it at face value and move on.

I know.

I was trying to spread some joy. Some folks were given real raises at a time when raises are hard to come by. All because one guy said "I make enough money. I'm going to cut my salary by 930k and spread the rest of it around to my loyal employees who got me here." I think that's noble.

I had no idea this was such an infuriating thing to do. I'm a bit mystified. Where's the downside here? The guy owns the company. He can do what he wants with the cash it makes and the compensation he allots himself. Corporate Stockholm Syndrome? I thought I was a smart guy who just thought of that but turns out it's a real thing.

I'm sure when some medieval peasant questioned the king's divine right to rule over them and hoard a huge chunk of the resources, a lot of the other peasants got riled up and defended the king too...

In reply to Xceler8x:

Well said.

Where am I riled? Where am I attacking the CEO? It's his business; he can hoard it all for himself and sleep on a mattress stuffed with Benjamins, or spend it all on hookers and blow, or subsidize the Seatac ferry so it's free to ride for a year, or pay his employees $70k minimum, or whatever he wants. All I did was ask 3 questions:

1. Is this sustainable?
2. What's the effect on morale for people who didn't get a huge raise?
3. What unintended consequences might there be?

If anybody thinks that is attacking, then sheesh, I'm done trying to discuss anything with you. Sorry for not jumping on the Yay Train.

I am also not attacking. I think its an interesting idea. Its just I'm tired of the media and consumers in this country taking marketing PR and presenting it as news. The situation described in the article is not possible. You cannot have the Average salary they discribed over the distribution they claim. That means some aspect of this story is either fabricated, disingenuous, or spun for PR. I have no problem with a company paying whatever they want for employees. By paying above market rate for some staff the CEO will have his pick of the best possible candidates in that position and should expect loyalty from them. It will be interesting what morale will do for employees that make more than 70k and are not increased beyond market rate. I wonder of their turnover or quality of candidates will decrease . I don't doubt that you could distribute most organizations top level earned pay amongst the lower levels and pay above market rates.

Man, you guys can suck the fun out of anything.

By insisting on looking at multiple sides and fact checking? OK, I guess.

There was a time when "Pay no attention to that man behind the curtain" was the media message that was appreciated, honest, practical, and thought provoking for both entertainment and education. People enjoyed it while growing.

Now the basic message to the media is, "Tell me what I want to hear, regardless of whether it's true or not". To any message that fails to hit that mark dead center and titillate us sufficiently, we corporately stick our fingers in our ears and yell,, "I can't hear you, I can't hear you!"

I have said in almost every post how much I like the idea, and want to see it succeed. Some of you would rather blame me for killing your buzz. I guess you are going to hear what you want to hear.

Sad.

SVreX wrote: Now the basic message to the media is, "Tell me what will keep me listening to you..."

FTFY

Big surprise, not.