
Breaking the Salary Sharing Taboo - pseudolus
https://www.nytimes.com/interactive/2020/02/19/magazine/salary-sharing.html
======
angarg12
I used to be open about my salary, until it went wrong.

In my first two companies I would openly share my salary, which worked in my
favour since I was underpaid. In my third company, where I had one of the
higher salaries, it didn't work so well.

My colleagues refused to share theirs (it transpired they were making less),
and that led to a lot of animosity and bad blood. Ever since I don't share
anymore, most people have the tools they need online to make an educated guess
on how well they are getting paid.

~~~
dnh44
If you don't mind telling, how did that result in animosity?

~~~
Aeolun
“You shouldn’t be making that much! I’m doing just as good a job as you!”

(narrator: They didn’t)

~~~
iso1210
That's an interesting take

"you shouldn't be earning more than me"

rather than

"I should be earning as much as you"

I wonder why (some) people immediately think the former

~~~
BlargMcLarg
Agency and effort. Or rather, let's change the latter statement so it sounds
less entitled: "Why am I not earning as much as you? I should be able to"

The latter statement requires the speaker to admit they screwed up. They can
get to that point, if they did research on how to get there or worked on the
key things they are missing currently. The former statement puts the agency on
the opposing party and basically expects some divine will of the heavens to
strike them down for their sin of earning more. Most people don't want to
change or admit their own mistakes. Or worse, they are indoctrinated by
Calvinism.

~~~
aalleavitch
This is all very self-indulgent. People don't get paid what they're worth,
they get paid the smallest amount someone can get them to accept.

~~~
rcoveson
Just what do you think the word “worth” means?

~~~
iso1210
The amount of value they add

Company X needs to employ two people in a role. The person they employ will
add $100 an hour of value to the company.

Person A has lots of money in the bank from a large inheritence and doesn't
need the job to live

Person B has desparately needs a job to pat the mortgage

Company X offers both $40 an hour

Person B takes the offer, as the alternative is reposession

Person A says 'no'

Company X still wants that extra $100 an hour of value, so offer person B $50
an hour, then $60. Person B then accepts at $60.

Both person A and person B are worth $100, neither get paid what they are
worth, but person A is paid 50% more than person B.

~~~
rcoveson
So if a crippled person needs somebody to go to the bank and withdraw $1,000
for them, and they figure they can hire somebody trustworthy for $50 to do the
errand, is that person not being paid what they’re worth, because they added
$1,000 dollars of value?

If person A in your narrative was capable of creating $100 dollars of value
all by themselves, they would do that instead. But they can’t. The $100
opportunity exists because of the company.

The company needs a shovel strong enough to dig up the $100. If one person
will sell such a shovel for $40, and that’s the best price available, they’ll
take it. That was the market value of shovels. It would be wrong to say the
shovel was worth $100. Even if all the shovel sellers in the area knew about
the details of this opportunity and decided to set they’re prices at $99, it
would quickly become apparent that shovels aren’t really worth that. Two
things would happen: sellers would defect and set they’re prices lower than
$99 to secure the deal; this would happen as long and there was still and
profit to be made. And the company would remember what a shovel was supposed
to cost, get suspicious, and look in to manufacturing a shovel of they’re own,
or commissioning a rake shop to make one.

This game of price setting is pretty good at approximating worth, especially
compared to your proposed strategy of measuring the delta between company
profits in reality, and in an alternate reality where the employee didn’t
exist and the company didn’t attempt to fill their position with anybody or
anything. The latter is not worth talking about.

~~~
EliRivers
_So if a crippled person needs somebody to go to the bank and withdraw $1,000
for them, and they figure they can hire somebody trustworthy for $50 to do the
errand, is that person not being paid what they’re worth, because they added
$1,000 dollars of value?_

This is a terrible example. Moving something is not the same as creating that
something. Moving $1000 could be worth nothing. It could have negative value.
It could be worth millions.

~~~
rcoveson
Right, and there are many things in between. Maintaining an object, improving
an object, combining objects to make complex object, etc.

If you’re in the business of creating useful objects out of basically nothing,
you don’t even need a company. Maybe you hire somebody to sell your objects
for commission, or maybe you sell them yourself.

If you’re looking for a closer analogy, try the shove analogy. Why is it that
despite the fact that the shovel makers are creating an object, even out of
nothing, that they aren’t worth what is dug up with them? Software engineers
are a lot like the shovel makers. Sometimes the shovels we make are used in
extraordinarily profitable ventures. But their value is still determined by
how hard it was to make them, and to learn the skills to make them. Not what
the company uses them for.

I think it becomes hard to see when all the shovels being made are bespoke.
Lots of software is written to fill one role for one client. That client will
often use that particular thing to make lots of money. So maybe it appears
like that thing bit of software created all the value? But this is clearly
false. The fact that some part of a system is essential to the whole system’s
success does not imply that the worth of every piece of the system is
equivalent to the worth of the whole system.

~~~
justanotherc
This is a good way of putting it. All these "run your own agency" self-help
courses have been pushing "value based" pricing with the promise that you can
slap together a Wordpress template and charge $40k for it because of the
"value" a website brings to the company is mostly nonsense IME. Stuff is built
by the lowest competent bidder, period.

------
choeger
There are two incentives at play here: A company obviously wants to pay as
little as possible. So if there are employees that do not realize they are
underpayed it benefits the company in the short term. On the other hand,
employees who feel they receive a good salary or any other extraordinary
benefits do not want to publicly talk about this fact to not alienate their
colleagues (who they suspect earn less).

Public salaries on the other hand reduce a company's flexibility: When
negotiating a new contract, they cannot offer 10% more anymore. On the other
hand, no one should apply if the salaries do not match their expectations...

I guess it can work reasonably well, but individual cases would suffer
somewhat.

~~~
dang
> _A company obviously wants to pay as little as possible._

I suppose I'm naive, but it seems obvious to me that a company should want to
pay its employees as _much_ as possible—that is, as much as is consistent with
the value the employees deliver. When I say "should", I don't mean morally. It
just seems obviously in the company's interest.

~~~
paloaltokid
You're reminding me of the "Spanish Theory of Value" as explained in the book
Peopleware (DeMarco & Lister). I highly recommend this book.

From Chapter 3 of the book: "The Spanish Theory...held that only a fixed
amount of value existed on earth, and therefore the path to the accumulation
of wealth was to learn to extract it more efficiently from the soil or from
people's back."

I think that most folks, once they're a few years into their careers, have
seen and understood that this theory of management and value extraction is
alive and well in corporate America today.

From the same chapter: "Productivity ought to mean achieving more in an hour
of work, but all too often it has come to mean extracting more for an hour of
pay. There is a large difference."

So I agree with you. It seems obvious to me as well that companies _should_
pay as much as possible. But they don't think that way, because they're coming
from a different value set.

~~~
dang
Even the value set of greed should nudge them in that direction—though perhaps
not short-term greed.

~~~
paloaltokid
Again, we agree. But it's that word _should_ that is the delta between how we
would like it to work and how it currently actually works.

------
alpinemeadow
If our starting point is to agree that people are individual in their
experiences, competence, what they can bring to a team, then it follows that
salaries are a subjective value attached to each individual.

With this approach it is our task to come to the negotiating table:

\- informed on floor and ceiling for the position's compensation (there are
websites and unions and many ways to get this info besides asking)

\- ready to show what I can bring of value that it's worth paying more than a
mere floor compensation, or above the ceiling.

In the past I've only shared information with people I know will be discreet
in how they use it, and it has helped them, and it has helped me. The
interesting thing is that most of these cases are internal moves. You can't
just ring people in the company you are interviewing for and ask...

------
trixie_
I’d be frustrated with my colleagues to know how much they make and they’d be
frustrated with me. Job titles jr, 1, 2, sr are frustrating enough. I’m always
surprised when I learn a great engineer is only a 1. Management uses grades
like a carrot and stick. I’m all for giving people with the same job the same
title.

Public grades/salary on the other hand makes it hard to work with people. You
can’t look at another person without thinking of their worth and compare it to
yours. It creates unnecessary drama, makes people think they’re more important
than they are, and distracts from the actual work. Glassdoor and recruiters
already should give you a good idea of what you’re worth. Knowing other
people’s compensation will only lead to jealousy of others and others of you.
It’s one of those human nature things that can’t be turned off so best not to
exacerbate it.

~~~
mrweasel
Personally I don't consider my salary a secret. Even though my colleagues
newer shared their salary with my, they've always gotten an honest answer if
they asked my.

Apparently those of my colleagues who now know what I make believes that I'm
under paid by around $1000 per month. At the same time I feel that my pay is
excellent and that my co-workers deserve every cent they make.

Drama around people salaries could arise, but only if your company rewards
people randomly. Knowing that a colleagues makes more than you should prompt
you to ask your boss what it is that you're doing or not doing that keeps you
at a lower pay, and your boss should be able to tell you exactly why you're
paid less.

In my experience recruiters and public salary databases isn't that useful.
Most large organisations have their own, or buy access to salary statistics
and will use those. In my case recruiters have been off by as much as $15000
per year, not including existing bonuses and overtime.

Salaries should in my mind should be public. I believe it will result in more
equal pay, but also lower salaries to a large group of people who currently
enjoy a salary that isn't reflective of they responsibility or the importance
of their job.

~~~
trixie_
"your boss should be able to tell you exactly _why_ you're paid less."

'Why' is a qualitative measurement. You will never agree. The debate will
never end. It will always be well be, "he did X, I did Y, I think Y is more
important, so I think I should be paid more" times a thousands of employees.

Believe me grades are a public salary microcosm. I worked at a company for 4
years that added grades to titles in the middle of my stay. It was a disaster.
People were never happy, always jealous, constantly asking their boss 'what
they need to do' to achieve a subjective thing.

I think you're right it would lead to more equal pay because that would be the
only way to avoid the drama. It does put the company at a competitive
disadvantage now because -

    
    
      Your competitors know how much all your positions make, while they don't have to make theirs public
      Hiring a dev at a discount is impossible because they will complain
      Hiring a dev at a premium is impossible because current employees will complain
      Holding on to talent is harder because if they leave for a better offer - you cant match their pay because everyone else will complain
    

Really the only way this isn't a problem is if you're underpaid - like you
are. And like I said there are many services out there that will give you a
good idea of range you should be paid.

------
mattr47
I never understood this since I worked for the US military for 22 years.
Everyone knew exactly what everyone else made, including extra duty pay,
housing allowances, bonuses, etc.

We never bitched about the pay someone else was making. It was just the way it
was.

~~~
ozim
Software devs are totally not like military personnel. Marketing people are
not like military personnel. Of course I assume there is bunch of a-holes in
mil and people who try to game the system. I never been to military but I
assume there are much more clear rules, ofc your superior might like you more
and you get promoted, but there is no ranks or requirements written down in
business so amounts of gray areas is much larger there.

------
enriquto
As a member of academia where our (low) salaries are published in a government
website, I find it rather strange to know that in private companies the
salaries are not public. You mean that different people doing the same job
earn a different salary? How is that even possible? How do people put up with
this bullshit?

~~~
altvali
There are arguments on both sides. We want to make sure that companies don't
offer lower salaries to immigrants, blacks, women etc. On the other hand,
productivity varies wildly among different people doing the same job.

~~~
enriquto
> On the other hand, productivity varies wildly among different people doing
> the same job.

But then they are not doing the same job, and it is reasonable that they earn
more.

In a grocery store, the prices are public and visible to all clients and other
stores. You are reasonably sure that the seller is not reaching a "private
agreement" with most other clients. This kind of public information is a basic
tenet of a market economy. Otherwise the whole thing is taken over by arbiters
(aka "negotiators") instead of productive people. I honestly do not understand
why such an important part of the economy (the actual salaries!) is not bound
by the same rule.

~~~
swsieber
> But then they are not doing the same job, and it is reasonable that they
> earn more

The issue is wether everybody realizes they aren't doing the same job.

> In a grocery store

Comparing performance of people is a lot more subjective than comparing food.
Your comparing apples to oranges here.

If performance was easy to compare, it'd be a lot easier to push for
transparent salary information.

~~~
enriquto
> If performance was easy to compare, it'd be a lot easier to push for
> transparent salary information.

If performance is not easy to compare, what is the point of assigning
different salaries to people?

~~~
sokoloff
Because people’s performance is different, even if it’s hard to reduce that to
a numeric score in a totally objective way.

When I look back over my career, I know which 20 or so engineers I’d want to
hire for a startup where engineering mattered. Even if I can’t assign an exact
percentage how much better they were, I sure know who they are.

------
dang
An article with a similar title from 5 years ago:
[https://news.ycombinator.com/item?id=9926192](https://news.ycombinator.com/item?id=9926192)

~~~
magicram
So this seems to be a long trending topic and still without an answer

------
Havoc
It's pretty safe in places with very strictly tiered salaries. The more
performance driven it is the less safe it becomes because everyone thinks
they're the best.

~~~
SwiftyBug
I don't think that's true. In fact, I believe most people think they are less
performant than their peers.

~~~
Havoc
A case could be made for either - impostor syndrome on one hand, massive ego
on the other. The ego side is what kicks off the problems in this debate
though.

But yes, perhaps it's less than 50%. Hard to tell

~~~
luckylion
My experience comes down on the ego side in general, that is, there are more
people who (massively) over-value their ability and contribution than there
are people who (massively) under-value theirs.

That may depend on industry and location though. Different jobs are likely to
attract different people.

------
rtkaratekid
I really like the idea of salary transparency, and I honestly don’t mind if
someone is making more than me (as long as I don’t feel neglected). However, I
was once hired at a company and had to move from across the country from a
place I loved living to a place I wasn’t sure about. So I negotiated
everything I could. I asked for more time off (didn’t get it), I asked for a
higher salary to cover the cost of living in this new location (got it), and a
few other things. I felt pretty good about the negotiation and I was being
hired for a very specific niche skillset that would help the company a ton.
Not long after I was hired, I learned I was making as much or more than people
who were more experienced and probably more talented than me... and as casual
as I am about pay, not everyone is, so I shut right up about it. I guess my
point is that not everyone will push as hard as me or be as fortunate as me
and there’s just a lot of factors to consider. I wish it wasn’t like that
sometimes, but I’m this case I got a much better gig than I would’ve
otherwise.

------
twodave
From the company’s point of view this seems like a very bad idea. It
essentially cripples their ability to attract great talent.

In order to avoid drama in the workplace, companies adopting this sort of
policy would undoubtedly adopt a standard pay scale that excludes their top
workers. Maybe the existing employees are grandfathered in? Or maybe not. In
either case you end up not being able to spend extra on that one employee who
could really help your business goals.

And I say that as a person who pretty freely shares what they make (though not
typically with current coworkers) and also earns well above average in my
region.

Just imagine having the sorts of discussions we have about ostensibly-overpaid
NFL players, except about George in Logistics and you’ll start to see what I’m
imagining.

~~~
arcanus
> Just imagine having the sorts of discussions we have about ostensibly-
> overpaid NFL players

While bad from a companies point of view, salary transparency is one of the
few free market mechanisms in sports, and it does generally result in
meritocratic distribution. The very fact you can mention someone who is
perceived as overpaid implies scrutiny far beyond anything possible in a major
corporation.

Frankly, I suspect this would be worse for company profits more than anything
else. In sports they have a strict % of total revenue that salaries can come
out of,which limits the pot. Employees would certainly have no such artificial
limit, in fact such a thing would likely be illegal.

------
gk1
This taboo about salaries seems only to exist in places with big salary
disparities, and/or where salaries are closely tied with self-worth.

In Russia, for example, “how much do you make” is a question as common and
unusual as “What city are you from?”

~~~
buybackoff
Yes, in Russia many impolite people tend to ask that, but the usual response
it "just enough" or something vague. Maybe factory workers share that easily,
but in high salary circles it is also a taboo. Maybe because it's so much
above country-wide average that one had better be silent about that. Lived in
the country until last year.

------
wortelefant
To get a better sense of my salary range,I found talking to recruiters very
helpful - especially those whose bonus is tied to their prospects' future
salary. In my current job, that number was a really exact estimation.

------
kabes
From the article: "a business that offers feminist-minded co-working spaces".

How should I imagine a feminist minded co-working space?

~~~
101404
Remember when Google did a company-wide study to find out for how much women
at Google were underpaid? And it turned out that women in the same job were
actually earning much more than their male colleagues doing the same thing.

Now imagine "open salaries" making it obvious that the "women underpaid" is
just a lie. An entire industry of "feminism" would die.

Maybe NYT should not push too hard for this "openess".

~~~
joshuamorton
> earning much more than their male

less than 1% is not "much more". Please don't editorialize. Especially when
the data I have (and I have more than most!) on Google's internal salaries
shows that women do appear to be underpaid by some measures.

~~~
101404
What are those "some measures" and where is the 1% coming from?

~~~
joshuamorton
"We provided $9.7 million in adjustments to a total of 10,677 Googlers." ->
just under $1000 per adjustment, on average. Note that since the comment here
is that the affect group (L4 men) was large and led to the majority of the
changes, we can generally discount ideas like "oh there were a small number of
massive adjustments and a large number of tiny ones", or we can believe that's
the case, but then the L4 men adjustments would be smaller on average, not
larger.

The average L4 SWE at Google is taking home more than $200K annually, and has
a salary well over 100K, so these changes amounted to less than half a percent
of total comp, and less than one percent of salary.

As for "some measures", the short answer is that when you control for
performance rating and level, as Google did here, things generally look
reasonable.

The problem is that there are good reasons to believe that historically
equally performing women were less likely to be promoted (for various
structural reasons that I won't get into, weren't malicious, and have been at
least somewhat addressed). The result then is that high performing women may
still be under-leveled or under-compensated in relation to their actual
performance.

So a completely reasonable interpretation of this sequence of events is that
women were as a group, somewhat under-leveled. Their managers, individually,
noticed this and did (as Google leadership suggests) what they could to use
manager-discretionary compensation to address this underpayment. Again,
individually and stochastically. The overall analysis notices this, and
because one stochastic process (promotion) previously had a bias against
women, and because the recent analysis didn't control for that, I get an extra
$1K.

Which is nice, but it's not anything particularly special.

~~~
101404
> equally performing women were less likely to be promoted

So they disproved the "wage gap" lie with hard data, and, as if nothing
happened, you pull out the next unfounded myth?

Got any hard data?

~~~
joshuamorton
No, they showed that Google doesn't have a gender wage Gap when controlling
for performance. This doesn't disprove anything in general. Nor did it address
preexisting concerns that aren't myths.

And yes, but not publicly.

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xhkkffbf
So is Susan Dominus willing to disclose her salary at the NYT? I doubt it.
She's probably one of the better paid and it would create quite a bit of
jealousy.

------
readme
ignorance is bliss

