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Tech Startup Buffer Publishes Every Employee's Salary, Right Up To the CEO 229

Posted by timothy
from the ok-but-what-about-their-coffee-consumption? dept.
Hugh Pickens DOT Com writes "Paul Szoldra reports at Business Insider that Joel Gascoigne, CEO of social media startup Buffer, reveals his salary along with the salary of every single employee in the company, and includes the formula the company uses to get to each one. "One of the highest values we have at Buffer is transparency," says Gascoigne. "We do quite a number of things internally and externally in line with this value. Transparency breeds trust, and that's one of the key reasons for us to place such a high importance on it." Gascoigne, who has a salary of $158,800, revealed the exact formula Buffer uses to get to each employee's number: Salary = job type X seniority X experience + location (+ $10K if salary choice). Gascoigne says his open salary system is part of Buffer's "Default to Transparency" and says Buffer is willing to update the formula as the company grows but hopes that its focus on work/life balance fosters employees that are in it for the long haul. "In Silicon Valley, there's a culture of people jumping from one place to the next," says Gascoigne. "That's why we focus on culture. Doing it this way means we can grow just as fast—if not faster—than doing it the 'normal' cutthroat way. We're putting oil into the engine to make sure everything can work smoothly so we can just shoot ahead and that's what we're starting to see.""
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Tech Startup Buffer Publishes Every Employee's Salary, Right Up To the CEO

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  • Norway (Score:5, Informative)

    by lxs (131946) on Sunday December 29, 2013 @09:32AM (#45811099)

    The nation of Norway does this for every citizen. [wikidot.com] It seems to work out for them.

    • Re:Norway (Score:5, Interesting)

      by Anonymous Coward on Sunday December 29, 2013 @09:59AM (#45811267)

      No it does not work out well for us.

      It is a gross violation of privacy and it is being used by criminals.

      • Re: (Score:2, Informative)

        by Anonymous Coward

        Pretty much this.
        The tax info has always been public, but you used to have to request the papers in person.
        With it available online for a limited amount of time, websites like newspapers then store the information for anyone to look up, any time.

      • Lots of things work for Norway, and lots of other countries, that doesn't work for us. We are abnormal when it comes to the rest of the world. Now that may not always be a bad thing...but normal we are not.

      • Re:Norway (Score:5, Interesting)

        by buddyglass (925859) on Sunday December 29, 2013 @12:30PM (#45812061)
        Neither of those two things ("gross violation of privacy" and "is being used by criminals") necessarily implies that it is not "working out well for you". Perhaps the system creates benefits that (in some peoples' minds) outweigh those two negatives.
    • Re:Norway (Score:4, Informative)

      by TyFoN (12980) on Sunday December 29, 2013 @11:44AM (#45811813)

      This is incredibly stupid. Criminals use it to pick out who to rob, and the news has a feeding frenzy every year where they single out people who actually contributes.

      I hope this system will be gone and buried soon along with the whole envy culture that we have in this country with the new government.

      • This is incredibly stupid.

        Indeed. Income was also made public when the income tax was first implemented in America. The goal was to reduce cheating, because it was assumed people would report their full income because they would be ashamed to appear poorer than they actually were. But the opposite occurred. People did NOT want their neighbors and relatives to know the extent of their wealth, because they feared both criminals and leechers requesting "loans". The publicity led to under reporting of income. Unlike the Norwegians

      • Re:Norway (Score:5, Interesting)

        by drinkypoo (153816) <martin.espinoza@gmail.com> on Sunday December 29, 2013 @12:09PM (#45811931) Homepage Journal

        This is incredibly stupid. Criminals use it to pick out who to rob

        Perhaps the Norwegians feel it's incredibly stupid to create a culture that creates criminals by promoting wealth inequality.

        • by TyFoN (12980)

          Publicly posting tax information has nothing to do with wealth inequality.
          That is the excuse, not the reason. The only ones that need to know your income is the computer systems that is used to calculate taxes.

          Fighting wealth equality should happen in policies, not publicly shaming those who work hard and actually contributes to the society.

          It is hard to explain to foreigners often, but there is a deep rooted culture of envy that historically have been strong where someone standing out in a positive way is

          • by drinkypoo (153816)

            It is hard to explain to foreigners often, but there is a deep rooted culture of envy that historically have been strong where someone standing out in a positive way is pulled down as hard as possible.

            It's shocking, shocking I tell you, that people who have had less advantage in life would be upset when others with a superior starting position exploit it to their further advantage over others.

            Sure, sometimes people really do pull themselves up from nothing, with a whole lot of help from others around them of course, but hard work is the worst predictor of success.

            • by pipedwho (1174327)

              Someone please mod the parent up.

              'Success' is far better predicted by cut-throat underhanded behaviour and initial wealth than because someone 'worked hard'. An employee's ability to negotiate better than the next guy is also a huge advantage.

              Here's an anecdote that I'm sure is a deja vu moment for many here:

              At a company I worked at years ago, one of our best (and hardest working) software developers, was paid far less than one of the worst.

              The 'worst guy' surely would have been a sales guy if it meant he c

          • Re:Norway (Score:5, Interesting)

            by pijokela (462279) on Sunday December 29, 2013 @04:34PM (#45813335)

            Fighting wealth equality should happen in policies, not publicly shaming those who work hard and actually contributes to the society.

            It is hard to explain to foreigners often, but there is a deep rooted culture of envy that historically have been strong where someone standing out in a positive way is pulled down as hard as possible.

            I live in Finland and we also have publis tax information. I think the rationale for having that information public is to make hiding income harder... if you have no taxable income and your neighbour sees you buying new cars every year, that may cause him to go and talk to someone at the tax office. I'm not sure if there actually is someone you can report a suspected tax evader, but that's the general idea. The shaming is bad, but that is mostly done by the press here and AFAICT there is no shame if you have some reason for the large income. E.g. people owning companies are treated more like heroes.

            But, anyway, what I really wanted to say was that the "culture of envy" is a myth. We have the same myth here too. The envy is mostly inside the head of people earning a lot of money. The people earning less generally do not care.

            Personally I am very much in favor of public tax information. I usually check the income of some of my coworkers every couple of years. Usually their wages are very much what I expect, but once I noticed that my previous employer valued writing design documents over creating working software - and after learning that I decided to change to another job. I did not start raving and frothing at mouth.

            Usually, what you imagine without the information is much worse then the reality.

            Compared to what Google and NSA are doing, I find the public tax information to not be a problem.

            • by Darinbob (1142669)

              This is silly. It's not your business to now what your coworkers make, except as a way to leverage a higher salary for yourself. I would feel terrible if my salary were public to my coworkers; either because it was lower than theirs and I would be ashamed, or because it was higher than theirs and feel bad for them. It would affect peer performance reviews, rather than judge fellow workers fairly it would create a bias.

              It's my business to pay attention to myself, and not my business to pry into other peop

      • Re:Norway (Score:4, Interesting)

        by Anonymous Coward on Sunday December 29, 2013 @12:29PM (#45812057)

        This is incredibly stupid. Criminals use it to pick out who to rob, and the news has a feeding frenzy every year where they single out people who actually contributes.

        I hope this system will be gone and buried soon along with the whole envy culture that we have in this country with the new government.

        Fellow Norwegian here, this is actually a myth. There isn't any evidence that this ever happened. After populist politicians kept repeating this claim, the police did the research, and came up disproving it completely [p4.no] (Google Translate [google.no]). Criminals don't need tax info to seek up nice neighborhoods and look for houses to rob.

  • by smileytshirt (988345) on Sunday December 29, 2013 @09:37AM (#45811129) Homepage
    Salary = job type X seniority X experience + location

    So I guess productivity and contribution to the business doesn't count. Great. Time to sit back and eat pretzels!
    • How many pretzels can you buy now that they've curtailed the length of time you can receive unemployment benefits?
    • Re:Contribution? (Score:4, Interesting)

      by guises (2423402) on Sunday December 29, 2013 @09:57AM (#45811251)
      There aren't a lot of careers that link your salary to your productivity. It's usually not possible - how would you suggest doing that for a social media startup? Pay employees by total lines of code written? By smallest number of bugs? These sorts of things have been tried by many companies, but they always seem to create detrimental incentives. If you pay by lines of code then you're telling your employees to use longer, sloppier code. You're also punishing them for helping out around the office in any way that doesn't involve writing code.

      The method that has stood the test of time is to hire employees who have a good work ethic and fire those who don't. If all of your employees are helpful, contributing employees, then paying a standard wage isn't a problem.
      • Re:Contribution? (Score:5, Insightful)

        by psperl (1704658) on Sunday December 29, 2013 @10:20AM (#45811371) Homepage
        This is not true, especially with software developers. I manage quite a few of them, and it doesn't take long to be able to determine their approximate individual worth, without metrics. Activities outside of writing code are hugely influential to an employee's value, such as educating other team members and communicating with customers or our business sponsors. Obviously I can't pinpoint an exact number, but its obvious as night and day who the real catalysts are within the group, and I can adjust accordingly.

        Companies that don't link your wage to your individual abilities are trying to take advantage of you. Plain and simple. I say trying, because one day it'll backfire. The most profitable companies that depend on skilled labor (not Walmart or McDonalds) pay their employees well, and do not use a uniform pay scale.
      • how would you suggest doing that for a social media startup? Pay employees by total lines of code written?

        Employee B frequently misses deadlines based on his own scoping of the task. Employee A rarely does.

        Employee B's code is frequently the cause of serious production bugs. Employee A's code rarely is.

        Employee A often suggests solutions in technical meetings that are superior to what was currently being discussed. Employee B rarely does.

        Employee A is capable of quickly diagnosing and repairing co

  • by rolfwind (528248) on Sunday December 29, 2013 @09:43AM (#45811159)

    Do they also list the stock ownership ,stock options and bonuses of every employee too?

    No snark, genuinely interested in how far transparency goes and how far it has to go before transparency is actually achieved.

    And what is the goal?

    I know some people that do the work of 4 of their colleagues, would it be wrong to pay them 4x more? Afterall, the company still saves on healthcare, parking spaces, and other redundant costs. What a person is worth is not always reducable to a position.

    • by fermion (181285)
      This is what I was thinking. I have had jobs where bonuses were 35% of my compensation. In addition to that, there are other means to keep compensation non-transparent. Health care plans can be more expensive for certain employees. Certain employees may get various allowances. In the religious racket, these allowances are often kept hushed up to make it appear that leaders are compensated in a limited fashion. For corporate compensation, the number of under the table tricks are endless, including cars
  • Spending over $300k/yr on whatever the hell these people do. I wonder what they add to the bottom line (surely a better basis for calculating rewards).
  • by Lumpy (12016)

    Seniority is not always a good reason to give someone more money. There are new guys out there that can show up at the job and be 2X as effective as the guy that has held the position for 5+ years. And this assumes that the CEO is an honest guy and gives out raises every 6 months for cost of living.

    Dishonest companies do not do the Cost of living increases.

    • by rcs1000 (462363)

      While that's true, firms want to encourage employees (by and large) to stick around. Therefore making it attractive financially, in terms of some seniority element, is economically sensible.

      • Re: (Score:3, Interesting)

        by Lumpy (12016)

        I have not seen this for over a decade. Almost every job change I make, I will come in at a salary that is equal to or higher than the guy that has been there for 10 years.
        This might have been a reality in a distant past when management actually cared about employees and wanted them to stick around, but I noticed in the past 10 that most only care about the next quarter profits and to hell with anything else. I watched my company recently let a very good person walk out the door to a competitor because t

  • by rockmuelle (575982) on Sunday December 29, 2013 @11:17AM (#45811691)

    It will be interesting to see if they keep this up when they're spending customer's money rather than investor's. A blank business with a set amount of money to spend is easy to model this way. Once you start to find the real value in your offering and determine how revenue is actually made, things get trickier. One or two stellar salespeople or engineers can be responsible for an outsize portion of the business. They need to be compensated appropriately.

    -Chris

  • Isn't this the way the free market is suppose to work? In an open market workers (suppliers) can see what positions and skills are being paid the most (demand). I would think open salaries would make for a more competitive environment and assist in reducing the extreme income equality in America.
  • by argStyopa (232550) on Sunday December 29, 2013 @11:40AM (#45811797) Journal

    Personally, I'd rather not work for a firm where the quality of my work doesn't equate in the least with the pay calculations. Do I look like some unionist drone (at least in Europe, they are usually paid along the same sort of gridded scale).

    Yes, of course, anyone rationalizing it will simply say "well, we only keep exceptional people" - to which, after 30 years in the workplace, I call "bullshit".

    In every group there are going to be achievers and slackers. Frankly, I want my compensation*/pay to be the highest I can compel the company to pay me, otherwise yeah, I will go somewhere else.

    *note, compensation isn't pay - there are a host of other ways a company can compensate an employee that can be hugely beneficial that aren't cold, hard, taxable cash.

    • Personally, I'd rather not work for a firm where the quality of my work doesn't equate in the least with the pay calculations.

      Wow, that was like a triple-negative sentence ... absolutely no idea if you are for or against being a slacker and fair pay for laziness ... and don't think you didn't break my brain with that ... er, in the least.

  • I'm sorry, but it's hard for me to respect any firm that employs multiple people under the title "Happiness Hero". What exactly is it that a "Happiness Hero" does?

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