I froze the salaries of my executive team to benefit other workers • Hacker News Board

Re: I froze the salaries of my executive team to benefit other workers

#101

Post by bluGill » Thu, May 16, 2019, 1:54 PM UTC

mercer wrote: post #82

Kalium wrote: post #74

Earlier quoted context omitted.

> I wonder if you could apply this to the rest of American society... At very large-scale companies, it doesn't always work as well as coud be hoped. A company ten times the size of this company may not have ten times as many extremely-highly-paid executives, but it probably has ten times as many people further down the pyramid. For example, the CEO of United Airlines is compensated $18 million-ish. There are 88,000…

What if you were to add up the income of not just the CEO, but all high level management or, say, those who make more than 500.000 a year? Honest question that I'm not sure how to answer myself, but I suspect the benefit to the lower ranks would be much more than the $200 a year.

Still not much. I didn't bother to look it up (it probably isn't public), but doubt more than 10 people at United make more than $500,000/year, so the amount isn't significant. Now if you said $200,000/year I would expect a significant amount of people make that. However now you are getting into the middle class where lifestyles have expanded to spend most of that money, and they would feel the pinch.

Re: I froze the salaries of my executive team to benefit other workers

#102

Post by lotsofpulp » Thu, May 16, 2019, 1:56 PM UTC

SketchySeaBeast wrote: post #88

allworknoplay wrote: post #85

This is insane -- paying a $7.25/hr minimum wage to people you call "teammates" and expecting them to stick around is preposterous. In anything but a terrible economic downturn, minimum wage says to employees that you just want a body doing a job right at this moment, but aren't willing to invest any further in them. Why would anyone stick around, or care to do more than the most basic job requirements? These jobs ar…

I was watching a sitcom called Superstore a little while ago, features the employees in a Wal-Mart like store, and the protagonist got a promotion to the head of the store. There was a whole plot line about how her wage was now in the 6 figures, and I was incredulous until I did a bit of research - Wal-Mart store managers can absolutely make that much money while their employees live in poverty. How you could make th…

Supposes employer A chooses to pay their employees more than other employers. Employer B chooses to pay their employees less. Both employers are selling products or services that the purchaser finds the same, i.e. they have no preference for who they buy it from.

Employer B takes the money they save by paying employees less, and invests in newer, better facilities or R&D or whatever. Now employer B is selling a better product than employer A. Who will customers choose to purchase from? Who will lose business, and end up having to fire employees?

To be a successful business, compensation decisions can't be based on people's feelings. You have to consider when a new store or hotel or restaurant will come around and put them out of business, and stay ahead of the curve. You pay what you need to to get the job done. There are some good examples like Costco, but there are only so many people with sufficient disposable income who can afford to shop at Costco and similar stores, and they're not competing with Walmart/CVS/Dollar Store or other bottom tier vendors.

Re: I froze the salaries of my executive team to benefit other workers

#103

Post by saalweachter » Thu, May 16, 2019, 1:57 PM UTC

mercer wrote: post #82

Kalium wrote: post #74

Earlier quoted context omitted.

> I wonder if you could apply this to the rest of American society... At very large-scale companies, it doesn't always work as well as coud be hoped. A company ten times the size of this company may not have ten times as many extremely-highly-paid executives, but it probably has ten times as many people further down the pyramid. For example, the CEO of United Airlines is compensated $18 million-ish. There are 88,000…

What if you were to add up the income of not just the CEO, but all high level management or, say, those who make more than 500.000 a year? Honest question that I'm not sure how to answer myself, but I suspect the benefit to the lower ranks would be much more than the $200 a year.

Or, if you take a company like Google, give every engineer a 5% haircut, bring the chefs and cleaning staff and groundkeepers and building maintenance back into the company (rather than contracting out), and distribute the money and stock grants among the support staff.

Re: I froze the salaries of my executive team to benefit other workers

#104

Post by leesec » Thu, May 16, 2019, 1:58 PM UTC

allworknoplay wrote: post #85

This is insane -- paying a $7.25/hr minimum wage to people you call "teammates" and expecting them to stick around is preposterous. In anything but a terrible economic downturn, minimum wage says to employees that you just want a body doing a job right at this moment, but aren't willing to invest any further in them. Why would anyone stick around, or care to do more than the most basic job requirements? These jobs ar…

The lesson isn't terrible, employee's should be paid more, but yeah to act like this is a grand discovery seems a bit absurd.

Re: I froze the salaries of my executive team to benefit other workers

#105

Post by mcv » Thu, May 16, 2019, 1:58 PM UTC

Chris2048 wrote: post #94

mcv wrote: post #77

Earlier quoted context omitted.

Maybe, or maybe not. I think the first concern is that everybody should be able to eat, have a roof over their heads, and have the freedom to focus on other things. I think it's definitely healthy for a society if the poor are able to save some money so their life doesn't immediately collapse on a rainy day. Once that's sorted, I'm all for investigating all the maybes.

Depends. Maybe not all "poor" are the same. Some choose not to stay in school, what do you do then? Guarantee food and shelter anyway? Why work my way up through the humiliation of McJob when I can stay home and prove my worth in Xbox?

Are we still talking about stimulating the economy? Then yes, making sure they have money to spend will ensure they spend it, increase demand, and grow the economy.

But yes, reject humiliating jobs. I'm not sure why you'd actively want people to be miserable.

But if you want a bigger picture: create better opportunities, and make sure they are accessible to everybody. The whole reason people withdraw from society into either drugs or gaming or whatever, is that, from their perspective, society has nothing to offer them but humiliation and misery. Heaping more humiliation and misery on them is not going to fix anything.

And if rich kids drop out of school and spend their time partying, they're also guaranteed food and shelter, and quite a bit of wealth on top of that.

Re: I froze the salaries of my executive team to benefit other workers

#106

Post by SketchySeaBeast » Thu, May 16, 2019, 2:00 PM UTC

lotsofpulp wrote: post #102

SketchySeaBeast wrote: post #88

Earlier quoted context omitted.

I was watching a sitcom called Superstore a little while ago, features the employees in a Wal-Mart like store, and the protagonist got a promotion to the head of the store. There was a whole plot line about how her wage was now in the 6 figures, and I was incredulous until I did a bit of research - Wal-Mart store managers can absolutely make that much money while their employees live in poverty. How you could make th…

Supposes employer A chooses to pay their employees more than other employers. Employer B chooses to pay their employees less. Both employers are selling products or services that the purchaser finds the same, i.e. they have no preference for who they buy it from. Employer B takes the money they save by paying employees less, and invests in newer, better facilities or R&D or whatever. Now employer B is selling a bette…

But employer B also can now remove employees due to the investments they made in automation - if they can remove the workers entirely they'll have even more money to invest in making a better product to edge out employer A. At the end of the day the worker always loses.

Re: I froze the salaries of my executive team to benefit other workers

#107

Post by res0nat0r » Thu, May 16, 2019, 2:01 PM UTC

lotsofpulp wrote: post #102

SketchySeaBeast wrote: post #88

Earlier quoted context omitted.

I was watching a sitcom called Superstore a little while ago, features the employees in a Wal-Mart like store, and the protagonist got a promotion to the head of the store. There was a whole plot line about how her wage was now in the 6 figures, and I was incredulous until I did a bit of research - Wal-Mart store managers can absolutely make that much money while their employees live in poverty. How you could make th…

Supposes employer A chooses to pay their employees more than other employers. Employer B chooses to pay their employees less. Both employers are selling products or services that the purchaser finds the same, i.e. they have no preference for who they buy it from. Employer B takes the money they save by paying employees less, and invests in newer, better facilities or R&D or whatever. Now employer B is selling a bette…

Sounds like a great argument to increase the federal minimum wage so everyone is forced to pay their employees more.

Re: I froze the salaries of my executive team to benefit other workers

#108

Post by bluGill » Thu, May 16, 2019, 2:01 PM UTC

taneq wrote: post #37

rakoo wrote: post #35

Earlier quoted context omitted.

If it even goes into luxury buying, rather than to an investment account that will only enrich them and whoever is managing the account.

That's the thing, once you reach a certain level of net worth it's actually relatively hard to become poor again. You have to actively make really poor financial decisions over a long period of time. Buy a boat for $100,000 and it'll cost you money to maintain and run. Buy a boat for $100 million and it'll earn you money if you lease it out or take passengers during the 11 months of the year that you're not using it.

Maybe. It is hard to making money leasing your boat. You need to pay the crew and such. If the market of people wanting to lease a boat is down one year you still have to pay those people.

Note that a boat is a bad example on your part. There are lots of other things you can do that are more likely to earn money.

For that matter if you can afford a $100 million boat, the crew cost is a line item that you can ignore and thus your boat sits in port 11 months just so you can have your boat. If you really like that boat it isn't a big deal that you are losing that much money.

Re: I froze the salaries of my executive team to benefit other workers

#109

Post by Miner49er » Thu, May 16, 2019, 2:02 PM UTC

It's amazing this article even needs to be written. You'd think the executives pulling in these crazy salaries would be competent enough to know that paying their "team members" next to nothing is going to result in high turnover and be a bad business decision in the long run. This article frames his choice to actually pay his employees as some big discovery, but it's not. The fact is, execs already know, but they put their short-term greed over what is best for their employees, the company in the long term, and their communities.

Re: I froze the salaries of my executive team to benefit other workers

#110

Post by bluGill » Thu, May 16, 2019, 2:05 PM UTC

agent008t wrote: post #39

rakoo wrote: post #35

Earlier quoted context omitted.

If it even goes into luxury buying, rather than to an investment account that will only enrich them and whoever is managing the account.

You seem confused. It is much, much better for the world if the money is invested than if it is spent on frivolous personal consumption.

It doesn't really make much difference.

If you invest it directly you support whatever you invest in. (you might or might not get it back depending on if the investment is successful) The best case you supported a new things that everybody buys, thus creating a company that employees a lot of workers.

If you buy luxury goods you directly support all the employees of the companies that make those goods, keeping them in a job.

Even if the investment choice was a life saving drug, the luxury purchase means those employees have money and they are likely to donate to research of life saving drugs.