LinkedIn had an interesting article Friday whose title I snagged for this blog post.
The 7 items are:
- We don’t care about pay scales
- Forget policies. We talk.
- We think about our pay a lot.
- We will sometimes let you take advantage.
- When we have to negotiate … we both lose.
- No matter how much we earn, it’s not enough.
- Still, reasonable pay is ok.
Several of the points resonated with me – especially in light of things I have written previously.
“If the company can’t afford to pay an employee more, smart bosses say so. If they think a certain percentage raise is fair, they explain why. Smart bosses use pay scales to build their budgets, and use reason and logic - and empathy - to explain pay decisions to employees.”
Can’t agree more: if you don’t treat your employees like rational, smart human beings, but rather like mere resources – you create and/or perpetuate a culture of dehumanization.
“Many companies actively discourage staff from talking to each other about their salaries. I know a few companies that require employees to sign agreements stipulating they won’t disclose pay, benefits, etc to other employees.
Doesn’t matter. Employees talk. I did, both when I was “labor” and when I was “management.” Generally speaking, the only employees who don’t share details about their pay are the ones who are embarrassed by how much or how little they make.”
Yes, yes, a million times yes! In my blog post “publicizing compensation – why not?“, I point-out that forcing people to not talk about their compensation makes folks more likely to try to find out, and can lead to discontent.
“Employees think about pay all the time. Every time they deposit their paychecks they think about their pay. To a boss their pay is a line item; to employees, pay is the most important number in their family’s budget.”
Funny thing is: managers get paid, too – but rarely think about that when it comes to their employees.
“Occasionally the job market is a seller’s market, but many new employees are just really happy to land a new job. And since business owners are born cost cutters, it’s natural to hire every new employee for as low a wage as possible.”
This is related to the next point …
“Great employees are worth a lot more than their pay. You get what you pay for, so smart bosses pay whatever they can to get and keep the best employees they can.
When smart bosses find great employees they always make their best offer, knowing that if their best offer is too low, there is nothing they could have done.”
If you want to be the best possible employer ever, you need to start with your best offer to candidates. If you start with anything less than your best, you’re implying that you don’t really value their time, expertise, or potential contributions to your organization. It has been said that “everything is negotiable” – but if you don’t start with your best offer, you’re telling your current/future employee they have to make you want them more. It may turn out that your “best offer” is $120,000 per year with 3 weeks of vacation. And maybe that employee really wants 4 weeks of vacation – and is willing to accept a somewhat lower salary for that perk. Start with your best, and then massage it into what is best for both of you.
“We all want more. It’s natural. Unfortunately no boss can always give more. And that’s okay.”
Wanting more is not inherently wrong (though wanting more for merely the sake of more is probably unhealthy) – and that’s why the last point in this article is so smart:
“People are smart. They understand market conditions, financial constraints, revenue shortfalls, and increased competition. They understand when a company can’t pay top-of-market salaries. What they don’t understand is when they don’t feel fairly compensated compared to other employees in similar positions, both inside and outside the company.”
“Fair is a concept that only exists in economic theories not based on effort.”* When you look at services like Glassdoor, you can quickly see that salary is only a single facet of employee compensation (and important one, and [generally] a large one, but only one). And it’s easy to get caught-up in the mindset of keeping up with the Joneses. While it is nice to have “more”, it’s important that honesty and transparency flow from management to employees as well as the other way around.