
New Remote-First Formula and Updated Salary Calculator - polysaturate
https://open.buffer.com/salary-formula
======
eximius
Wow, this is really terrible. This looks like a PR explanation for why they're
slashing everyone's salaries. A cursory glance shows everyone either staying
the same or dropping.

> One of the toughest decisions we made with the new formula was to remove the
> annual 3% loyalty increase given to teammates for each anniversary from
> their start date.

> We looked at a lot of options and in the end decided to remove it as it
> created an unsustainable, compounding affect on pay.

3% is at or just above inflation. If you can't afford to give these raises,
you will see severe wage stagnation and, hopefully, a mass exodus of employees
elsewhere.

~~~
dyeje
This is delusional. How does someone have the nerve to put a paragraph like
this in a blogpost about how they're giving almost every employee a paycut?

    
    
      The question on everyone’s mind was “Can we afford this?” and “is this sustainable?” When we sought input and advice from those outside of Buffer we also were asked, “Why would you pay your team members with more generosity than you need to?” As it turns out, our answers are: Yes, Yes and because we believe it’s the right thing to do.

~~~
andylei
except the CEO and the director of people. their salaries magically stayed
exactly the same

------
ryanwaggoner
I know this is cynical, but this really just reinforces my suspicion: the open
salary thing is actually an attempt to underpay through a formula that's
presented as objectively fair. Over time, it ends up gravitating your
workforce towards average or below-average performers. There's no room for top
talent here, because there's no subjectivity in this formula.

If you're a fantastic dev (or whatever), why would you work here when other
companies will pay you a lot more?

~~~
kowdermeister
As worker in Eastern-Europe, their salaries look totally awesome to me. You'd
be surprised for this money how many good people you could find.

~~~
ryanwaggoner
Let me be clear: from one perspective, I get paid a _ridiculous_ amount of
money for what I do. I push buttons and think for a living. I spend a few
hours per day doing it, I really enjoy it, and I can do it anywhere in the
world from my laptop.

It's _crazy_ that someone is willing to pay me $100k / year, and I'm super
grateful for that. Really.

However, that doesn't mean that $100k / year (or whatever the minimum I'd be
excited about) is the market rate. If ten other companies would pay me $300k,
then I should go work there, right?

There's no speed limit. Just because someone is willing to pay you way more
than you ever dreamed doesn't mean you should shun any more than that. Do your
best and go to where you're valued the most.

~~~
kowdermeister
I get that, my point is that with their "lower" salary I could get the best of
both worlds like staying in my current city (Budapest) and earning as much as
a good CEO here.

I get offers from companies, but if the job/product is boring, a higher salary
does not justify the switch for me.

I don't disagree with you, I tend to gravitate towards a high pay :) We will
soon have a salary formula refactor too, but I think the raise might be a
rounding error compared to remote pays.

------
beberlei
Initially when I saw this open salary approach and especially the calculator I
was intrigued. But you cannot make salaries into a formula and get 100% good
results.

The approach Basecamp (37signals) has with picking a location, then paying
people based on 95% percentile (top 5%) market rate regardless of where they
live is just much easier to explain to employees than some arbitrary
multiplier thing that just leads to endless discussions.

[https://m.signalvnoise.com/how-we-pay-people-at-
basecamp-f1d...](https://m.signalvnoise.com/how-we-pay-people-at-
basecamp-f1d04f4f194b)

~~~
pc86
I think a multiplier is fine as long as it's for where the person actually
lives, and is based on the actual overall COL as opposed to "well this isn't
SF or NYC we we're automatically chopping 15-25% off your salary lolol"

~~~
beberlei
i find cross country comparisons that lead to multipliers very hard and often
arbitrary, because of differences in taxes, social security, health insurance
and of course the exchange rate.

------
hajile
Why do companies continue to pay out higher salaries to devs in high cost of
living areas? In this case, their payscale pays out 30-50K more in high cost
living areas vs low cost areas.

Rather than blow revenue rewarding bad life choices, offer to move them to an
area with lower costs of living. Do that for only 10 employees and you have
300-500K EVERY SINGLE YEAR to re-invest into your company. In practically any
other industry, this kind of saving would be obvious.

~~~
simonw
Because if you do that, they'll find another employer that doesn't force them
to move.

Living in a high cost area is not a "bad life choice".

~~~
imsofuture
I moved out of a high CoL area to somewhere I actually enjoy living. And
brought the salary band with me.

No chance I'd work at Buffer, given they'd halve my salary because of my zip
code. Other remote jobs don't. No brainier.

~~~
graton
They state they pay 85% for Average CoL area and 75% for Low CoL area. So they
wouldn't halve a developer's salary who moved from San Francisco to somewhere
else. Working in San Francisco gets 100%. Now I don't know how their SF
salaries compare to other companies though.

~~~
pc86
@imsofuture said they'd halve _their_ salary, which is likely true. Every
remote salary calculator I've ever used, even being generous with my
qualifications and the vague dropdowns like "below average or above average
experience" gives me a rate 15-40% below what I'm making now, even for the
next level up.

------
hardwaresofton
Another company that does open salary calculations is Gitlab:

[https://about.gitlab.com/jobs/developer/#compensation](https://about.gitlab.com/jobs/developer/#compensation)
(this is a random developer job, you can check out other positions @
[https://about.gitlab.com/jobs/](https://about.gitlab.com/jobs/))

Here's the feature ticket: [https://gitlab.com/gitlab-com/www-gitlab-
com/issues/831](https://gitlab.com/gitlab-com/www-gitlab-com/issues/831)

Disclaimer: I don't work for Gitlab, but I am a pretty biased rabid fan.

~~~
celim307
This is ~30% under market.

~~~
noitsnot
Yes, that's what I get also. The calculator is way off. I can't imagine them
holding employees for more than a few months or year.

------
danvoell
There is a lot of typical HN negative analysis in this discussion. Let's step
back and applaud the fact that this is open. Who else does that? People don't
do it because they are afraid of this type of negative analysis. This is a
very cool comparison for those who don't have concrete numbers to take into
HR. Thanks for sharing Buffer!

~~~
ryanwaggoner
Maybe they _should_ be afraid of this negative analysis. You don't get a pass
on bad decisions just because you're making them openly.

From my cursory glance, I have a bunch of problems here:

1) Most egregiously, it looks like they're slashing a bunch of salaries. Not
the CEO, of course, but a lot of others seem to be going down. I would be
immediately headed for the door in that scenario. Talk about a way to keep
only the poor performers who can't get another job.

2) Related to the above, what signal does this send to future hires? "We'll
pay you $X based on this fancy formula...until we decide to change the formula
and slash your salary by 20%."

3) Large COL adjustments make no sense to me. So I work for a remote company
and choose to live somewhere cheaper and they think that the value I'm
providing is less? The end result of this is that remote devs get screwed on
average, while the best remote devs avoid companies like this, rightfully so.

4) I didn't look very carefully, but they definitely seem to be underpaying in
general. An advanced engineering manager (mobile) in a HCOL area gets $145k?
I'm a senior mobile developer and I'm pretty confident I could significantly
outearn the CEO if I lived in SF or NYC.

~~~
chrisan
> 3) Large COL adjustments make no sense to me. So I work for a remote company
> and choose to live somewhere cheaper and they think that the value I'm
> providing is less? The end result of this is that remote devs get screwed on
> average, while the best remote devs avoid companies like this, rightfully
> so.

Ya I don't get this logic. High COL areas are high because there are _lots_ of
perks living there. It is much more desirable to live in SF than to live in
East BF Mississippi. You are basically rewarding someone by living in a high
COL.

When selecting remote jobs, I'm looking for compensation for the value I
bring. The dollars I earn from my value should be up to me how to spend them:
living in SF with all of the glorious food and such or living somewhere
cheaper and saving money to retire earlier but having to pick between
Applebees or Fridays ( _vomits_ ).

~~~
amyjess
> living in SF with all of the glorious food and such or living somewhere
> cheaper and saving money to retire earlier but having to pick between
> Applebees or Fridays (vomits)

Come to Dallas. You get to enjoy low COL (while it lasts) and have your pick
of Sichuan, Thai, Indian, Vietnamese, Mexican, barbecue, etc. restaurants.

------
awareBrah
This is interesting. One implication is that if I was in the dating market,
I’d be worried my date would google me, find that I work for buffer, and
instantly know how much I make. While that information isn’t exactly super
important or secretive, I just think I’d rather reveal that kind of info on my
own terms.

~~~
chatmasta
They could just check Glassdoor. You should assume average salary for your
position is public info.

------
cf
I'm not sure I agree with some of these figures. Vancouver and Nashville are
somehow considered to have similar cost of living.

[https://www.numbeo.com/cost-of-
living/compare_cities.jsp?cou...](https://www.numbeo.com/cost-of-
living/compare_cities.jsp?country1=Canada&city1=Vancouver&country2=United+States&city2=Nashville%2C+TN)

------
allandubey
Why??? Openess in work culture is great! Telling the whole world about how
much each individual earn is a slap on their privacy... Just because you can,
you shouldn’t. Be ready to welcome attrition.... Let me post the link of this
page on each employee’s linkedin fb accounts...lol.. anything in the name of
innovation.

------
wyager
I strongly disagree with cost-of-living-adjustments when employees have the
choice of where to live. People shouldn’t be punished for living in less
expensive places.

If your company is willing to pay you more for living somewhere else even if
they don’t gain anything from it, it means they’re underpaying you right now.

~~~
duncan-donuts
That's not really realistic though. How could I convince someone to pay me
$250k in Minneapolis when the market is supporting 115-150k?

~~~
hajile
In a world where remote is an option, there really shouldn't be large
differences in salary. In negotiations, the party who can most afford to walk
away has the advantage. If there were a real dev shortage, devs would be in
that position, but they aren't.

SV (and other markets) basically refuse to hire remote (and often refuse to
relocate employees). This splits the market up into mini-markets where the
slight oversaturation of devs allows the local market to dictate prices
(under-saturation would boost salaries even in a small market). This is born
out with the fact that those who do work remotely seem to have higher salaries
for a given experience level (their market is much bigger and more diverse).

The obvious answer is unions. Joint negotiations would yield immediate
effects. No large company could survive even a day or two of IT strikes
without extreme losses. Unlike other jobs, you can't simply replace your staff
because most of a company's software IP is held in the heads of its employees
and is far too complex to decypher before the losses occur.

------
peshooo
Recently there was a discussion about salaries in SF. And the numbers there
were much bigger. What gives?

~~~
ontoillogical
If you're talking about the triplebyte data ([https://triplebyte.com/software-
engineer-salary](https://triplebyte.com/software-engineer-salary)), Buffer's
SF salaries seem comparable.

~~~
umanwizard
That only reports base salary, making it worse than useless.

~~~
ontoillogical
If you're applying to non-public companies where the stock isn't liquid, it's
very hard to compare different packages across companies.

Benefits are another story, and I'd love to see triplebyte release some data
about those.

~~~
vonmoltke
Not to mention all the public companies that don't Grant stock or significant
bonuses.

------
seattle_spring
If I worked somewhere that tried to rationalize why they were cutting all of
the employees salaries but leaving the executive salaries in-tact, I would
leave immediately.

------
jatsign
I like the idea of transparent salaries, but does a "transparent" formula ever
become so convoluted, and open to gaming, that the company may as well just
not bother?

It can be argued that not disclosing salaries is a way to suppress wages; an
asymmetry of information. Is open salary information where "everyone at the
same level gets the same salary, but there's some gotchas" another way to do
the same thing?

~~~
baby
It certainly goes hand in hand with a good culture, which is also one of the
strong point of Buffer.

Their transparent webapp thing[1] is really nice to play with btw, it feels
like a no bullshit vibe for newcomers as well as current employees.

It makes me think that these "formulas" will probably not age well with time.
They're already at their version 3, which would probably not be a good formula
at the early days of the start up and will probably not be a good formula in
3-5 years.

Somehow related, I remember having something like these to rank posts on one
of my boards (similar to the weight ranking of HN). I had:

* time influence negatively

* number of upvotes and downvotes in the comments influence positively

* number of heavy posters influence positively

* number of upvotes for the post influencing positively

It was really tricky to tweak, in the end with the website scaling up I was
constantly tweaking the formula. I don't think there is a "always work"
formula.

[1]: [https://buffer.com/salary](https://buffer.com/salary)

~~~
jatsign
That helps, thanks.

------
eagletusk
Whoa $121k in Spain that's a superstar salary for a programmer there.

Average for programmer according to glassdoor is 35,000 euro = ~42,000 usd.

~~~
pc86
It seems odd that places in very low COL areas, particularly internationally,
are getting 3-4x median salary for the same role, while places in
rural/suburban US will be at or just slightly above median for that geo area.

~~~
hocuspocus
I can't talk for Spain in particular but keep in mind that employer's social
contributions can be pretty hefty in Europe. And working remote for an
american company is opening a bag of hurt regarding taxes and banking.

For instance that guy making $128k in Montpellier in France, that's €108k
right now. Assuming he works 45 weeks that's a daily rate of 480€. Not crazy
for an experienced developer.

------
eterm
What's an advocate in this context? It's their biggest department, bigger than
marketing?

~~~
simonw
Pretty sure that's their customer support team.

------
philipps
I am a fan of open salary models _inside_ the organisation, but don’t see the
value in sharing it publicly. It’s something we implemented at the non-profit
I co-founded and it has increased the sense of ownership and buy-in from
everyone on the team. One reason for not sharing the actual amounts is that
non profits generally pay less than for profit companies and I don’t want our
team to be pegged to their non profit salary when they decide to move on.

------
nsxwolf
Salary transparency leading to lower salaries... I had been led to believe to
expect the opposite.

------
sidlls
The transparency is great.

Here's a question: why doesn't Buffer pay the "low CoL" developers more? It
doesn't seem right that "low CoL" workers get paid so little compared to their
peers.

~~~
anonacct37
I agree. The first step to fixing or avoiding a problem is knowing it's there.

It's great to be able to have a little more understanding of what companies
are thinking when they try to judge an employees value based on location
rather than... value provided to the company.

I think the dynamics are pretty interesting. Forgive me if this seems like a
not so humble brag, but I'm remote and paid way more than anyone at buffer. I
also have a pretty decent network of remote friends at my company and at other
good companies.

With that in mind I can tell you that the practical effect of Buffer's
policies is that they have decided to self-select for developers who are
currently underpaid and historically have not had their pick of good jobs.
Because otherwise they'd be taking a pretty big paycut to work at buffer and,
while possible, it seems unlikely that social media management is a dream job
for many developers.

So the entire open policy, no matter it's surface intent, is basically a
policy to grab sub-par talent. Especially insecure talent who is willing to
buy into "radical transparency".

Meanwhile, my base is pretty close to their CEO's compensation, but I live in
a low COL area. It turns out that the marketplace is competitive enough right
now that it's a viable bargaining technique to say "pay me X, where X < Value
provided" and some companies will, without arguing (as if the argument made
any sense at all) that many people in your zip code make < X.

I guess that was a really long winded way of saying that buffer has
implemented policies that self-screen out the best developers, which is fine.
You probably don't need the best developers to send tweets on a schedule.

------
ronreiter
So if I'm worth 500k a year to Buffer they will not be able to pay that to me.
So stupid.

~~~
seattle_spring
So if I'm worth 100 million a year to Google they will not be able to pay that
to me. So stupid.

Spoiler alert: There's a very large chance that you're not worth $500k to
Buffer.

