How to Pay Remote Workers • Hacker News Board

Re: How to Pay Remote Workers

#51

Post by tdfx » Fri, Sep 13, 2019, 9:48 AM UTC

gjulianm wrote: post #47

tdfx wrote: post #31

Earlier quoted context omitted.

Workers should not be expected to be paid "fairly" or according to some broader social expectation. The company is not your friend and you are not the company's friend. They are paying you for sacrificing your time for their benefit. You are worth exactly the minimum that you're willing to accept in payment based on your individual circumstances.

"Expecting" is not the same as hoping that things would change. > You are worth exactly the minimum that you're willing to accept in payment based on your individual circumstances This is what I would like to change. There's an asymmetry of power in employment (if you lose an employee it's just a nuisance, if a person loses employment it can destroy their life) that is exploited by business and it can lead to terribl…

> such as people that are generating value for a company

Attempting to quantify this is exactly why we're in the situation that we are. If it was easy to quantify a person's "value" to the company relative to other workers, perhaps we would live in a different world. But it's not as simple as "salesman X received Y sales this month, 20% of that is Z". Who determines the hidden value of the marketing effort? How much of that should be allocated to the engineers who build and maintain the product? What about the people who find the talent to hire? Who would want to clean the toilets if the janitor wasn't here?

After that kind of thought experiment it becomes abundantly clear that there's no meaningfully objective way to quantify a worker's value as a percentage of company profit. Each person's perspective will color their estimation of a particular worker's value. An objectively bad solution.

The present way of doing things is not a result of any attempt at fairness or idealogical belief in the equality of man, it's really just the simplest working solution to the problem that anyone has been able to demonstrate.

Re: How to Pay Remote Workers

#52

Post by claudiawerner » Fri, Sep 13, 2019, 9:53 AM UTC

spurdoman77 wrote: post #34

cyborgx7 wrote: post #25

Earlier quoted context omitted.

The extra value generated from the combination of efforts is still generated by the workers who combined their effort to generate it. Why are the owners more deserving of that "extra value" than the workers?

The owners started the business, took the risk, etc. If an employee isnt happy with the salary, he can always ask for more, change employer, or start his own business. It is a fair game IMO.

>The owners started the business, took the risk, etc.

This does not seem like any kind of justification for continual reward, not to mention it doesn't apply at all in situations where the workers themselves take on a lot of risk day to day (e.g. construction). Furthermore, this would only work as a justification for when the owner really did take a risk, and companies where the current owner is the same as the person who started the business (i.e it's not clear that future CEOs shoulder the same risk). And of course, all of this is based on the idea that risk is an inherent good and worthy of reward and praise - I can see many cases where it's not, especially in very exploitative businesses.

>he can always ask for more

He can ask for it, but with the weakened power of collective bargaining it's unlikely he'll get it. It also depends on how replaceable the worker is. Did you see the article on HN today about how Kickstarter fired two union organizers?

>change employer

From the point of view of the worker this doesn't help much at all, since there would be no reason they'd necessarily get a better wage at other places.

>or start his own business

With what capital? Even if he had capital, why would a worker who is so disillusioned with the nature of wage work feel compelled to start a business? Unless he doesn't care for the plight of others against what he experienced while he was himself a wage worker.

Re: How to Pay Remote Workers

#53

Post by gjulianm » Fri, Sep 13, 2019, 9:56 AM UTC

pfisch wrote: post #17

gjulianm wrote: post #4

Salaries based on cost of living are always a mistery to me. If the company wants to have an honest relationship with the worker, the salary should be based on the value the employee is bringing, and that does not depend on where they live. Tying the salary to the cost of living looks like a way to cheat a worker out of the value they generate.

"the salary should be based on the value the employee is bringing" This is really so vague as to be meaningless. A McDonalds can't operate without someone at the drive through. So isn't the value of the drive through worker incredibly high since they are essential to the operation of the business? No. Labor Economics tells us that an employee will be paid at the market rate. They are paid based on how many other peop…

Not necessarily. The drive through employee is essential, but the cook is also essential, and the restaurant manager is also essential probably... The value is shared among them.

Also, Labor Economics tells us what happens, and I do not argue with that. I am saying that we should take more into account actual value and avoid extreme profit-driven views, such as reducing someone's salary for the exact same job just because they live in X country instead of Y.

Re: How to Pay Remote Workers

#54

Post by spurdoman77 » Fri, Sep 13, 2019, 9:57 AM UTC

idiocratic wrote: post #37

spurdoman77 wrote: post #28

Earlier quoted context omitted.

But as an employer, why I should strive for honestness? Does it bring me more profit? To me it sounds like paying too much. I pay market rates which doesnt consider cost of living or value produced, but the the average salary for the skillset/experience.

It brings value in the long run and makes retention easier. If I work for a company who pays differently based on location, I'll soon be searching for a company that pays the same based on level of seniority or other internal criteria.

I dont really buy that argument. Local developers are not going to quit because you are paying remote developers less. Location is substantial factor in salary, and almost everyone seems to understand that. Onsite developers are paid generally substantially more.

Re: How to Pay Remote Workers

#55

Post by spurdoman77 » Fri, Sep 13, 2019, 9:59 AM UTC

ehnto wrote: post #40

biblytens wrote: post #24

Earlier quoted context omitted.

Salaries are based on supply and demand. Think this one through with that in mind and it'll make more sense.

It still doesn't make sense, because the remote worker pool is global. If that were supposed to make sense then we would all be getting paid third world rates and cost of living would still have nothing to do with it.

Well being onsite adds value to buyers. If you dont think so, the only way to proce that is by starting your own company with remote-only. Remote devs are cheap so you should be rich very quickly, if they provide the same value as locals.

Re: How to Pay Remote Workers

#56

Post by mnm1 » Fri, Sep 13, 2019, 9:59 AM UTC

spurdoman77 wrote: post #28

oAlbe wrote: post #21

Earlier quoted context omitted.

That's not the point though. Having an honest relationship with your employees and treating everybody fairly doesn't prevent you from profiting. It think this point is explained really well in the article: why should someone who lives in a city with a high cost of living be paid more than someone who lives in a low cost of living one? Effectively, what you are doing is giving the person in, say, SF, more money to be…

But as an employer, why I should strive for honestness? Does it bring me more profit? To me it sounds like paying too much. I pay market rates which doesnt consider cost of living or value produced, but the the average salary for the skillset/experience.

You should strive for honesty because otherwise you will not get the most out of your employees. If you don't pay them as described here or forgo raises, they will respond in kind by working less, taking more time, and doing lower quality work aka slacking off. You think you'll be able to tell, but you won't because from the outside it won't be obvious. So you'll get what you pay for instead of what you could get if you paid honestly.

Re: How to Pay Remote Workers

#57

Post by gjulianm » Fri, Sep 13, 2019, 10:04 AM UTC

tdfx wrote: post #51

gjulianm wrote: post #47

Earlier quoted context omitted.

"Expecting" is not the same as hoping that things would change. > You are worth exactly the minimum that you're willing to accept in payment based on your individual circumstances This is what I would like to change. There's an asymmetry of power in employment (if you lose an employee it's just a nuisance, if a person loses employment it can destroy their life) that is exploited by business and it can lead to terribl…

> such as people that are generating value for a company Attempting to quantify this is exactly why we're in the situation that we are. If it was easy to quantify a person's "value" to the company relative to other workers, perhaps we would live in a different world. But it's not as simple as "salesman X received Y sales this month, 20% of that is Z". Who determines the hidden value of the marketing effort? How much…

I agree that quantifying value brought by someone is extremely hard. I think market rate (when the demand of employees is high enough) works as the consensus of how much does a worker generate.

> it's really just the simplest working solution to the problem that anyone has been able to demonstrate.

'Working solution' is a stretch. There is a lot of people working below a living wage in companies that still post significant profits, where top executives receive salaries several orders of magnitude higher than those employees. That does not seem adjusted to me.

And don't get me wrong, solutions to this problem are hard and I know it, the system is complex. But situations like paying less to remote workers when they do the same work are incredibly clear and easy to solve, and they show that it's not only that it's difficult, it is that those business do not care at all about making things fair for their employees.

Re: How to Pay Remote Workers

#58

Post by barry-cotter » Fri, Sep 13, 2019, 10:06 AM UTC

Hard_Space wrote: post #2

As a remote worker, I think there is an assumption of 'necessary common suffering' which continues to make remote work a 'privilege' rather than a simple logistical alternative. So long as there are on-location cubicle-dwellers who might get disgruntled to know that other employees are living some kind of fantasy high life from home (working in PJs, etc., all the tropes), then providing any remote working options bec…

> I'm not sure how much progress we are ever going to make towards remote working as core practice, since the last decade has re-built a collapsed economy on the basis of hyper-inflated urban property values in 19thC-style urban conurbations such as NYC, SF, Tokyo, London, etc

Tokyo’s rental prices and house prices have moved very little in the last twenty years while the population has gone up by half. If you let people build housing you can have huge increases in population without increases in property prices.

> The net-enabled, 'dispersed' society is probably further away than it has ever been because of these factors.

Fully remote companies exist and their numbers will only grow. There were very few of those ten years ago and there will be a lot more than double the current number ten years from now.

Re: How to Pay Remote Workers

#59

Post by pfisch » Fri, Sep 13, 2019, 10:06 AM UTC

gjulianm wrote: post #53

pfisch wrote: post #17

Earlier quoted context omitted.

"the salary should be based on the value the employee is bringing" This is really so vague as to be meaningless. A McDonalds can't operate without someone at the drive through. So isn't the value of the drive through worker incredibly high since they are essential to the operation of the business? No. Labor Economics tells us that an employee will be paid at the market rate. They are paid based on how many other peop…

Not necessarily. The drive through employee is essential, but the cook is also essential, and the restaurant manager is also essential probably... The value is shared among them. Also, Labor Economics tells us what happens, and I do not argue with that. I am saying that we should take more into account actual value and avoid extreme profit-driven views, such as reducing someone's salary for the exact same job just be…

What you are describing isn't how the free market works though. It is just a fantasy of yours.

In an efficient market your theoretical business would be driven into bankruptcy or bought out by the competition that is properly allocating capital.

Also the ceo answers to the shareholders who hired him with the job of maximizing returns. Unless this is a coop there is no reason for it to operate the way you are talking about.

Re: How to Pay Remote Workers

#60

Post by AstralStorm » Fri, Sep 13, 2019, 10:14 AM UTC

cyborgx7 wrote: post #41

onion2k wrote: post #36

Earlier quoted context omitted.

Where do you think profits come from? Profit is the difference between what you pay your workers and the value of their work. I don't think the OP is refuting that. Paying someone 50% of the value they generate is fine. That's how businesses work. Paying someone 2% of the value they generate because they live in is much less easy to justify.

It's trivial to justify. Companies exist to maximize profit. You make more profit by paying your employees less. Also, plenty of people in my responses are denying that this is what profit is.

It is still inhumane. There are other ways of running businesses, but rarely tried as they are typically squashed by bankers or VCs not providing financing.

Examples include directly hiring trade unions, cooperatives, associations...