
A Fair Day’s Wage: The Return of Fair Pay? - davidgerard
http://www.newyorker.com/magazine/2015/02/09/fair-days-wage
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rbcgerard
I don't understand how you have a discussion about this without discussing the
total benefits an employee receives.

i.e. if may salary remains constant at $30k a year but the employer portion of
my health care coverage is $6k/year and growing at 15% - I do not have
stagnant wages (i just didn't have a say in how they were spent)

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dingaling
> I don't understand how you have a discussion about this without discussing
> the total benefits an employee receives.

In the UK, most employer-provided 'benefits' are taxable in that their value
is deducted from the individual's personal allowance, i.e. the amount they
earn before paying income tax.

So it's even worse; not only does the employer 'spend' your salary on benefits
you may not want, but it also hits your wallet by increasing the amount of
income tax you pay.

One of the first things I do at a new employer is opt-out of as many benefits
as possible. They do not compensate with additional cash, but it reduces my
tax burden.

~~~
spacecowboy_lon
err? do you actualy work in the Uk? the only benefit that it can make sense to
opt out of is company car -

The major benefit in USA terms is health is all ready provided by the NHS.

Do you realy opt out of the pension? when I worked for a big company that was
worth 6% tax free - let alone the share save schemes

~~~
dingaling
> the only benefit that it can make sense to opt out of is company car

And private health insurance, gym membership and dental insurance, which
knocked £900 out of my personal allowance until I cancelled them at my last
work place.

~~~
spacecowboy_lon
Did you not ask if you coudl have the equivelent benefits added to your
pension ?

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mschuster91
What's not mentioned in the article: if your workers don't have to work at two
or, worse, three jobs to feed their family, they will be able to use their
free time to actually relax, thus being more healthy and productive.

And they are likely to be able to spend the money they earn in local stores -
because when I'd have to work 80h+ weeks, I simply would not have time for any
shopping except food - and everything else on amazon, where I can shop 24/7.

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stolio
One thing to note is that the weaker the social safety net is the more reason
companies have to pay their employees more. If a company can have part-time
(or sometimes full-time) employees who also receive food-stamps and Medicaid
from the government then they've effectively found a free subsidy. The
government is keeping their employees healthy for them.

But if an employee directly depends on a company for their wellbeing and the
wellbeing of their family then that company must take responsibility for those
things if they want their employees to be happy and healthy long term.

A fix, probably not very efficient, is if a company's employees are receiving
X dollars in aid from the government, then the first X dollars of profit go
towards paying that back. I think it's good we have social safety nets and
they should provide value to business in the form of healthy and able-bodied
workers, but companies shouldn't be leeching value in perpetuity from them. If
an employee of a company is on food stamps then that company is simply not
taking care of them.

It bothers me that we have people who work full-time who still collect
benefits because the companies they work for aren't taking care of them. We
don't fix their machinery if they refuse to pay for the upkeep, but we do pick
up the tab when they refuse to pay for the upkeep of their human capital.

~~~
bko
Wouldn't another, simpler fix be to stop providing government aid to those
employees? This would stop the government from subsidizing companies that pay
low wages. Suppose the market rate for someone is $30k. The employee hired
wouldn't particularly care if he gets 20k from the corporation and 10k from
government benefits. If you removed the government benefits of 10k, that
employee would still need to be compensated 30k to do that job. Therefore, the
company would need to pick up that tab.

If you claim that the employee is desperate and would work for 20k, then why
would the company even bother paying him the 20k in the first place, and
instead pay him 10k instead (minimum wage issues aside)?

I think the article takes too narrow of a view of what a market wage is. It's
not the bare minimum a company has to pay someone. It takes into account other
factors such as retention, satisfaction and the talent you attract. As the
article states, “increases in wages do, in fact, pay for themselves”. Wouldn't
that make it the market rate?

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bakhy
“Increases in wages do, in fact, pay for themselves.” -- Good management is
hard to find.

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dmichulke
This question has no answer because the word "fair" has different meaning for
everyone.

Somehow "fair" reminds me of "Atlas Shrugged", especially, when uttered by
government officials.

~~~
bsbechtel
Fair is a completely subjective definition, but I guess the idea is that
through a democratic process society as a whole comes to an agreement as to
what is 'fair'.

Instead of setting goals to pay people 'fairly' though, policymakers should be
looking for ways to 1) make it easier for people to acquire 'middle class'
jobs, and 2) make it easier for people to start their own business (remove
employer protections + improved access to financing). There are 300+ million
Americans that each have a unique perspective of this world. Each of these
unique perspectives provide the opportunity to creatively solve a problem in a
way that adds value to someone else, and start a business around it.

Of course only a small percentage will, but that number becomes even smaller
when you can't start your own firm because your employer has locked up your IP
that's unrelated to its core business, or you can't save up the $5-10K needed
to finance a prototype of your idea because your 'middle class' wages are too
low. If you make it easier for more people to start businesses (read: not
protect existing businesses), you create more jobs and the 'fair' wages take
care of themselves. Also, by forcing 'fair' wages on employers, you further
reduce the ability for someone to start a new business (specifically in retail
or food service) because their burn rate is now higher due to higher labor
costs.

