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Worker-owned businesses: 'We get paid the same regardless of role'

theguardian.com

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Re: Worker-owned businesses: 'We get paid the same regardless of role'

#11

Post by T2_t2 »

morgante wrote: post #4
golergka wrote: post #3

> We all get paid the same hourly rate regardless of the roles we do. Good luck retaining any skilled professionals then. One of the most repulsing stories that I got from Soviet Union from my grandparents was about excellent engineers being on the same pay scale with manual labour workers. No matter how much do you put into your skills, the system had standard pay scale that you couldn't break out from. I'm happy th…

Seriously. Can you imagine trying to hire a skilled professional who has put years of effort into acquiring a skill when you won't pay them any more than a retail cashier?

It depends on the mix of roles in a company I guess, but animal farm comes to mind here: all worker-owners are equal (but some are more equal than others). What happens when the company expands? Do the new employees get equal shares?

But these are positive-negatives, i.e. the harm is done by being successful. When the company starts to fail, what then? What happens when a company needs to downsize? Which of the worker-owners will survive, and under what conditions? Will it be political, e.g. we all vote, so the 7 PAs who everyone loves get to stay, but the entire sales department gets voted out? What about if departments vote together? Seems very sketchy.

Ironically, the ability to survive failure is why our system perpetuates. In the hard times, hard choices can be made that are individually distasteful, but required. Evolution is driven by the non-dying breeding, and corporate evolution is similar, with company structures that can navigate the bad times - much more than maximise the good times - the ones most likely to be replicated.

Re: Worker-owned businesses: 'We get paid the same regardless of role'

#12

Post by crdoconnor »

golergka wrote: post #10
crdoconnor wrote: post #7

Earlier quoted context omitted.

The market rewards leverage though, not skills. They only coincide sometimes. Academia is one place in particular where the two do not go together.

Markets rewards what you can give. You can have a lot of very hard to learn and impressive skills that have no economic sense whatsoever. Don't expect to get paid for them.

No, markets reward leverage.

This can be about what you can give, it is also about what your alternatives are, what their alternatives are, what you can take away and what you can threaten.

You don't need skill or economic sense to have it.

Re: Worker-owned businesses: 'We get paid the same regardless of role'

#13

Post by jubal00 »

lev99 wrote: post #2

I'd be interested in the economics of founders selling to their employees from a founder's point of view. It seems like a way to protect a founder's legacy after they exit. Where does the money come from? Do the employees get a loan and then the money from the loan go to the founder? Does the founder provide a loan to the employees and receive regular payments on the loan? Do the employees have to have cash? Do all e…

Employee Stock Options Programs (ESOPs) are the way most conduct this transaction. It's frequently a way for a founder to sell to employees due to relationships/promises, to get a higher valuation than the market offers, or, like with options, to incentivize productivity and retention.

The employees can get a loan with the business as collateral but the founder/s is going to hold a note as well. Assignments of stock are similar to options - customizable but more valuable employees get the lion's share.

Re: Worker-owned businesses: 'We get paid the same regardless of role'

#14

Post by jacob019 »

crdoconnor wrote: post #12
golergka wrote: post #10

Earlier quoted context omitted.

Markets rewards what you can give. You can have a lot of very hard to learn and impressive skills that have no economic sense whatsoever. Don't expect to get paid for them.

No, markets reward leverage . This can be about what you can give, it is also about what your alternatives are, what their alternatives are, what you can take away and what you can threaten. You don't need skill or economic sense to have it.

and markets reward luck

Re: Worker-owned businesses: 'We get paid the same regardless of role'

#16

Post by vedloseper »

golergka wrote: post #3

> We all get paid the same hourly rate regardless of the roles we do. Good luck retaining any skilled professionals then. One of the most repulsing stories that I got from Soviet Union from my grandparents was about excellent engineers being on the same pay scale with manual labour workers. No matter how much do you put into your skills, the system had standard pay scale that you couldn't break out from. I'm happy th…

Skillfulness to me implies giving a crap about the world you share with others. Skilled, in comparison, is a consolation price.

> One of the most repulsing stories that I got from Soviet Union from my grandparents was about excellent engineers being on the same pay scale with manual labour workers.

That's the most repulsing? Nothing about children and old people being murdered en masse? See above, more skillful grandparents would have told wholly different stories.

Re: Worker-owned businesses: 'We get paid the same regardless of role'

#17

Post by geofft »

golergka wrote: post #3

> We all get paid the same hourly rate regardless of the roles we do. Good luck retaining any skilled professionals then. One of the most repulsing stories that I got from Soviet Union from my grandparents was about excellent engineers being on the same pay scale with manual labour workers. No matter how much do you put into your skills, the system had standard pay scale that you couldn't break out from. I'm happy th…

Isn't it the case that with this sort of system that if you increase your skills, your company is more profitable and therefore you all get paid more? (Which is a common system in capitalist America - the exact same job with the exact same skills at different companies pays differently based on the company's ability to pay, and year-end bonuses are often linked to the company's profits that year. And employees who get stock grants or options are effectively compensated based on the performance of the company, incentivizing them to cause the company to succeed.)

That's very different from a system where the government sets pay scales for the entire country, and an individual's efforts cannot make a meaningful change in their own earnings. In the system described in the article, it can.

Re: Worker-owned businesses: 'We get paid the same regardless of role'

#18

Post by TheOtherHobbes »

golergka wrote: post #10
crdoconnor wrote: post #7

Earlier quoted context omitted.

The market rewards leverage though, not skills. They only coincide sometimes. Academia is one place in particular where the two do not go together.

Markets rewards what you can give. You can have a lot of very hard to learn and impressive skills that have no economic sense whatsoever. Don't expect to get paid for them.

Markets reward what you can take.

Sometimes you have to give first.

But only sometimes.

Re: Worker-owned businesses: 'We get paid the same regardless of role'

#19

Post by remir »

I find worker-owned businesses very interesting. Obviously getting paid the same regardless of role may be an obstacle to attracting highly skilled people, but if salaries are competitive and established in function of role and experience, in a transparent way, that could be great.

Re: Worker-owned businesses: 'We get paid the same regardless of role'

#20

Post by balance_factor »

golergka wrote: post #3

> We all get paid the same hourly rate regardless of the roles we do. Good luck retaining any skilled professionals then. One of the most repulsing stories that I got from Soviet Union from my grandparents was about excellent engineers being on the same pay scale with manual labour workers. No matter how much do you put into your skills, the system had standard pay scale that you couldn't break out from. I'm happy th…

> skills and professionalism can be valued by the free market by people competing for them; why, despite pure populism for the lowest common denominator, someone wants to return to something like this, is completely beyond me.

The real determination of where the money goes is by the owners of the business. If one looks over the Forbes 400 richest list, we can see the heirs who drain off so much profit each year from the labor of those who work - the Kochs, the Waltons, the Johnson family. The Rockefellers fell off the list in the past few years, $2 billion is the individual cutoff and I suppose Forbes doesn't know of any individual in the family worth more that that. But I can assure you if they and their three siblings are worth 1.5 billion each, and their first cousins are all worth 1.5 billion each, they are not out there breaking the bricks.

It's amusing to hear about meritocracy and the rat race for education, skills etc. when these heirs are the people controlling the economy, and causing so many economic and other problems due to its increasing lopsidedness towards them. What are their skills and professionalism that are valued? The money they suck off from those who work is the truest lowest common denominator, rule by parasites. At least Lenin, Stalin and Molotov rose due to their merits, not their birthrights. Russia went from being a country pushed around by the Japanese, with an GDP equivalent to 1917 Brazil, to a superpower sending satellites, men into space, probes to the Moon (the first country to do so). It also had little crime and little poverty.

I am supposed to get into a tizzy about someone with less skills getting the same pay as me, when the money is being sent off to the heirs who do no work? I certainly would prefer that the people actually doing the work alongside me get the money.

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