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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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  • 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: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.

  • by WOOFYGOOFY (1334993) on Sunday December 29, 2013 @10:18AM (#45811357)
    I think transparency is intended to forestall the structural imbalances which create jealousy in the first place.
  • Re:Meh.... (Score:3, Interesting)

    by Lumpy (12016) on Sunday December 29, 2013 @11:04AM (#45811593) Homepage

    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 they would not give him a piddly 10% increase.

    I really hope that companies come back to having real leadership, but I highly doubt it will happen in my lifetime.

  • 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.

  • 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.

  • 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.
  • by Austerity Empowers (669817) on Sunday December 29, 2013 @12:56PM (#45812165)

    If managers were paid that well anywhere I worked, I'd be inclined to get promoted! Mostly they make my salary with a little bit of extra "bonus" %. You know that bonus all employees get for good performance that is microscopically impacted by any individual working hard, but significantly impacted by the CEO being a moron.

    For 500 times my pay you're looking at some CxO. I'd take their jobs too but my father, mother, uncle, cousin, best friend('s roomate) are all poor nobodies, so short of blackmailing someone on the board there's no reasonable way to reach those heights. Plus, I'd have to start taking responsibility for investor's greed, which I could never bring myself to do.

  • by AK Marc (707885) on Sunday December 29, 2013 @03:24PM (#45812967)

    Let's say one of your unionized coworkers came up with and lead the implementation of an idea that would save your company $5M or increase revenues by 10% over the next year. What would their expected reward be? If a different company saw that result (or potential) in that same coworker, what might they be willing to extend in terms of a job offer to that person?

    Have you ever worked? If you are at a job and had one of those ideas, do you know what your reward would be? I'll give you a hint. It isn't monetary (unless the company had a written policy before-hand, and almost none do). So unions don't make a difference in whether a single exceptional worker is paid for their exceptional work. Those types of bonuses are reserved for management only, so at best, your idea could make your department head some cash.

  • 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 IcyWolfy (514669) on Sunday December 29, 2013 @06:21PM (#45813921) Homepage

    Back at a company I worked for in So Cal (2009)
    We switched to publically maing available everyone's salary.

    It basically quickly turned the tide on everyone there.
    Those where were hard workers but paid less got raises,
    And those making more but were obviously (to other developers) not pulling their weight, were either given a hefty salary cut, or let go.

    The net effect, was everyone was happier, and wage equalization among the general seniority levels.

    I personally thing this information should be made publically available across the country.
    Wage equalization and stopping the money from poolings up the social ladder is worth it.
    Large income disparities for "Silver tongued" and charismatic people shouldn't be allowed.

    And net benefit: wages across geographic areas owuld balance out, as companies won't be able to
      : pay H1B people less/more
      : under/over pay people as co-workers would quickly be able to tell if someone is under-performing
      : ability to easily switch companies with knowledge of their pay-grades
      : ability for companies to lure talented people by simply paying more making it more attractive
            - but not be able to do so on one-off bases, as existing staff would be offended
            - so wage leveling. Pay everyone more, or offer new person less.

    This would be awesome to implement.

  • by Anonymous Coward on Monday December 30, 2013 @06:16AM (#45816963)

    How do you know they've verified your old salary via a background check?

    (Posting anon for a good reason, see below)

    That's a good point. Currently on the prowl, meself, so talking from recent experience here :) All the slave traders and prospective employers ask for proof of your current salary (latest salary slip). They've always done so. This is to provide an anchor point (preferably a low one) before any negotiations even start. What generally happens is that they then offer a salary not too far off the current one (say... +10%). Giving away the salary slip effectively ends the negotiation and caps the most that they are willing to offer you. Even if they were, for example, willing to offer R500k, but your current salary is R300k, they'd rather you walk away than take you at R400k (fully R100k below what they were initially prepared to pay). The reason for this is because a hard negotiator is a "problem" down the line, and not easily manipulated.

    My, ahem, solution to all those jobhunters who are tired of getting hit with the anchor point tactic, is to simply photoshop the salary slip (they're all digital and emailed these days) with a higher salary. A simple spreadsheet formula calculates the correct value (to the cent) to put into all the fields so that it all works out correctly. Set the anchor point to around 115% of your current salary (don't want to make it too obvious, now do we?), photoshop all the fields in correctly and send them the resulting PDF.

    The recipient can't actually double-check this because:

    It isn't legal for them to contact my current employer and tell current employer that I am looking

    Even if they did contact current employer, it's still a criminal offense for my current employer to reveal my salary

    Personally, I'd prefer them to do so, as then I'll collect quite a windfall from the two criminal cases :) (Current employer paid out around R200m in 2013 due to stupid HR not knowing the law - a fraction of that my way and I'll never need to apply for a job again)

Given its constituency, the only thing I expect to be "open" about [the Open Software Foundation] is its mouth. -- John Gilmore

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