Should we know other people's salaries?

[Jurgis]

There's somewhat of a movement (articles/etc.) that knowing colleagues' salaries is a good thing .

There is some argument that this improves your own negotiating position, etc. (Well, it works for CEOs clearly!  ;)).

OTOH, you could argue that knowing colleagues' salaries lead to envy, hate, toxicity, etc.

 

What do you all think?

 

Vote.  8)

[mwtorock]

There's somewhat of a movement (articles/etc.) that knowing colleagues' salaries is a good thing .

There is some argument that this improves your own negotiating position, etc. (Well, it works for CEOs clearly!  ;)).

OTOH, you could argue that knowing colleagues' salaries lead to envy, hate, toxicity, etc.

 

What do you all think?

 

Vote.  8)

 

I think it is helpful to know the range of salaries of your coworkers. That way you can tell whether you have a future in the place or not, or whether you are undervalued or not, etc.

[Liberty]

At the time when looking for a job or negotiating for a raise, it can be useful.

 

Otherwise, I can't think of any good that can come of it and it's pointless. For many people it'll play into a bunch of negative cognitive biases, but I can't think of any positive ones (except maybe some people driven by a mix of ambition/envy).

[Gregmal]

I see no point to it. You should know what you are worth, or I guess at least, what you are comfortable doing for a said price. That's all that really matters.

[TwoCitiesCapital]

I fall in the middle. If the company is good at keeping records of internal reviews and can justify why a differential exists, open it up and let people know IF that's what the employees want.

 

Without having documented justification for differences though, it will likely create a toxic environment where jealousy arrives and a bunch of people demand pay raises regardless if they have earned them or not. They will feel entitled to the money without understanding the negotiation that went into it or the performance reviews that led to it.

 

Ultimately, a salary is a scorecard of relative performance (and negotiation ability). You have to make sure you can explain the disparities i.e. why someone is 1st in pay and someone else of the same position is in 10th. It also helps if salaries already reflect relative performance before making those disclosures....

[LC]

Absolutely yes. Although I will disclaimer that I am not the type to get jealous over these things.

 

I think generally, the more transparency the better. It is easier to take advantage of people who know less vs. people who know more.

 

Specifically, I think salary knowledge helps as others have mentioned in negotiations, knowing how your employer views you, etc. "Honest is the best policy".

 

What's the worst case, you believe you are underpaid/your co-worker is overpaid? You can either sit back and feel jealous and resentful, or you can behave like an adult and have a conversation with your manager to understand why that is the case.

 

Shit, if you have a good management team, they won't even wait for this. They will approach you and explain why you are paid this amount vs. your team-members.

 

So I think yes, it is good to know - but it requires a level of professionalism from all parties (employees and management).

 

There's a Munger quote out there about being wary of the person who limits your access to information. One of my favorites because it extends beyond investing and hits at how you treat people throughout life.

[undervalued]

Yes. Why? Because it will make a huge difference by time you retire.

 

Do you think Glassdoor (or other internet job search website) range is accurate? You won't know until you ask coworkers.

 

From my own experience, it's not accurate. If I use Glassdoor average, my salary is too high for my position. This indicates I won't likely find similar paying job if I chose to look for a new one. In my current company, I am in middle of the salary range.

 

I do realize that some people do ENVY so I don't think this is for everyone. You will find people who do less than you and get paid more, maybe a lot more. For me, I take it as a learning opportunity and reflection.

[flesh]

If we are talking about mandatory disclosure. No. Free market. Private property. Nobody has any business knowing what I pay people.

 

If we are talking about glass door or similar, sure.

[abitofvalue]

yes.. it would improve negotiating position of the average worker AND increase probability that managers actually pay based on performance rather than use confidentiality to pay based on whatever is easiest / convenient.

 

Intrestingly - I think California has a law that makes it illegal to force employees to keep salaries confidential that went into effect recently. Already having an impact at a couple of firm in finance - I've heard of West Coast offices getting bigger bonuses than NY..

[Jurgis]

Some additional questions to ponder:

 

- You can ask your colleagues what their salaries are (yeah California. MA soon too). Do you? (Not friends, but random colleagues). I don't.

 

- If a colleague asked you your salary, would you tell them? (Assuming they are not a friend). I would not.

 

- Do you ask your manager to tell you salaries of other employees? Would you ask them if company explicitly told you that you can ask? I'm not sure. Maybe..

 

- If you're a manager/business-owner, do you tell your employees salaries of other employees? If you don't do it because of company policy, would you do it if company was neutral about it? I'm not a manager, but I probably would not.

 

- I don't know any company/management that voluntarily discloses salaries of employees to other employees. Any examples of companies who disclose?

 

- Should the management be forced to disclose salaries of (all?) employees to (all?) other employees? I don't think they should be forced. I do like the CA/MA laws that make it illegal to force employees to keep salaries confidential. Employees should be able to tell their salaries/bonuses/whatever if they want to.

 

[rkbabang]

Twice in my career I've felt as I was underpaid.  The first time was when I was 5 years out of college and had worked at the same company for those 5 years.  I decided to leave, secured a job for 30% more than I was making, +stock, +half a years salary sign on bonus.  I gave my notice and my company immediately matched the offer (salary, stock and retention bonus), so I obviously was underpaid.  The next time over 10 years later after being with that company for over 15 years, I again felt underpaid.  I found another job, gave my notice and left for a much, much better offer which my company wasn't willing to match (they said they couldn't match it).  That was over 7 years ago and I couldn't be happier. I've never known what my coworkers made at any company, but if you feel you are worth more than you are making, see if you can find a job for more.  If you do and your company is not willing to match it, leave.

 

I don't want to know what my co-workers make or them to know what I make.  All I want to know is what my skills are worth on the market.

 

[Jurgis]

Meanwhile in Finland: https://www.nytimes.com/2018/11/01/world/europe/finland-national-jealousy-day.html

[rkbabang]

Meanwhile in Finland: https://www.nytimes.com/2018/11/01/world/europe/finland-national-jealousy-day.html

 

I've always said that this whole thing the left has about "equality" and "wealth disparity" is nothing but pure toxic envy eating at them.  It is a personality malignancy.  No matter how good you have it you can't be happy if someone else has more.

 

Interesting quote from the article:

 

"When people could easily learn the incomes of co-workers and neighbors, self-reported happiness began to track more closely with income, with low earners reporting lower happiness. "

 

[wachtwoord]

Meanwhile in Finland: https://www.nytimes.com/2018/11/01/world/europe/finland-national-jealousy-day.html

 

Wtf are these people (Finland and Norway) crazy? Incentivizing tax evasion to avoid being a target for an abduction or blackmail. It's really no-one's business how much wealth you've got.

 

Anyway I'm curious now: are there more countries than these two where it's possible to look up resident's private tax records? (Either as a private person, business or media).

 

Thanks for sharing the article!

[undervalued]

Twice in my career I've felt as I was underpaid.  The first time was when I was 5 years out of college and had worked at the same company for those 5 years.  I decided to leave, secured a job for 30% more than I was making, +stock, +half a years salary sign on bonus.  I gave my notice and my company immediately matched the offer (salary, stock and retention bonus), so I obviously was underpaid.  The next time over 10 years later after being with that company for over 15 years, I again felt underpaid.  I found another job, gave my notice and left for a much, much better offer which my company wasn't willing to match (they said they couldn't match it).  That was over 7 years ago and I couldn't be happier. I've never known what my coworkers made at any company, but if you feel you are worth more than you are making, see if you can find a job for more.  If you do and your company is not willing to match it, leave.

 

I don't want to know what my co-workers make or them to know what I make.  All I want to know is what my skills are worth on the market.

 

That sucks. I've had the same experience. First 3 years, I was under paid a lot. I then moved to a different company and got a 50% bump. In that 2nd company I learned from my nosy coworker that there too I was underpaid. I found this 2nd company through an agent and the agent also felt I was underpaid so he fought to get me a 20% bump. From my nosy coworker, I learned that I was still under paid. He then moved to a different state and had me apply there as well which I did. The company then matched my salary which gave me another 15% bump.

[LC]

Meanwhile in Finland: https://www.nytimes.com/2018/11/01/world/europe/finland-national-jealousy-day.html

 

I've always said that this whole thing the left has about "equality" and "wealth disparity" is nothing but pure toxic envy eating at them.  It is a personality malignancy.  No matter how good you have it you can't be happy if someone else has more.

 

Interesting quote from the article:

 

"When people could easily learn the incomes of co-workers and neighbors, self-reported happiness began to track more closely with income, with low earners reporting lower happiness. "

 

I disagree with your comment about envy. Now I understand you have your own biases when you're attributing these characteristics to "the left", but how can you be envious of something you do not know?

 

On the topic of wealth inequality you can simply look at the state of the US to determine the consequences.

 

On the topic of salary and income disclosure, it is about having full(er) information to assess your own situation. While ignorance may be bliss but I would rather people not live in it.

 

Also, the full picture of that quote is:

 

A study of faculty members at the University of California, where pay was made accessible online in 2008, found that lower-earning workers, after learning how their pay stacked up, were less happy in their job and more likely to look for a new one.

 

This jives with undervalued's experience. Presumably he is much better paid now thanks to knowing his coworker's salaries.

 

Wealth inequality is easier to develop when you (1) underpay everyone you can, and (2) limit their knowledge so they never find out they are underpaid. Why not discourage this?

[rkbabang]

Meanwhile in Finland: https://www.nytimes.com/2018/11/01/world/europe/finland-national-jealousy-day.html

 

I've always said that this whole thing the left has about "equality" and "wealth disparity" is nothing but pure toxic envy eating at them.  It is a personality malignancy.  No matter how good you have it you can't be happy if someone else has more.

 

Interesting quote from the article:

 

"When people could easily learn the incomes of co-workers and neighbors, self-reported happiness began to track more closely with income, with low earners reporting lower happiness. "

 

I disagree with your comment about envy. Now I understand you have your own biases when you're attributing these characteristics to "the left", but how can you be envious of something you do not know?

 

On the topic of wealth inequality you can simply look at the state of the US to determine the consequences.

 

On the topic of salary and income disclosure, it is about having full(er) information to assess your own situation. While ignorance may be bliss but I would rather people not live in it.

 

Also, the full picture of that quote is:

 

A study of faculty members at the University of California, where pay was made accessible online in 2008, found that lower-earning workers, after learning how their pay stacked up, were less happy in their job and more likely to look for a new one.

 

This jives with undervalued's experience. Presumably he is much better paid now thanks to knowing his coworker's salaries.

 

Wealth inequality is easier to develop when you (1) underpay everyone you can, and (2) limit their knowledge so they never find out they are underpaid. Why not discourage this?

 

The state of the US is pretty damn good.  Jobs are plentiful and almost everyone is doing pretty damn well.  No one (and I mean no one except for the mentally ill living under a bridge drinking themselves to death refusing shelter) is without food or a roof over their heads or heat (if needed).  Almost no one lives without a smart phone or access to the internet.  Everyone has a TV, a microwave, a cooking stove, and most have a car (if needed).  Look at socialist countries where everyone is equal, even food isn't a given.

 

EDIT:  I deleted something I wrote here that upon re-reading wasn't very nice. I apologize.  It is just that I do not understand how anyone can look at the tremendous wealth generated in the United States and the elimination of anything that could be called real poverty as a bad thing simply because some people happen to have a lot more than others.

 

Also. You quoted the paragraph above the one that I did. The full quote is:

 

"A study of Norway, which made its tax data easily accessible to anonymous online searches in 2001, reached a similar conclusion: <b>When people could easily learn the incomes of co-workers and neighbors, self-reported happiness began to track more closely with income, with low earners reporting lower happiness.</b> In 2014, Norway banned anonymous searches, and the number of searches dropped dramatically."

 

[wachtwoord]

Lol moved to politics haha

 

Anyway I think we have several topics:

 

1) should we know the salaries of co-workers?

My answer to this is that the employer should decide. There is an obvious opt-out if you don't like it (quit).

 

2) nation-wide public tax records?

Seems like an obvious no to me because short of emigrating there is no opt-out (and then there needs to be a country which doesnt do it) and obvious safety concerns. The maffia would love this.

 

3) is wealth inequality a problem?

No quite the opposite. Value creating behaviour in society needs to be sufficiently rewarded to motivate those able to  to actually do so. The rest of society benefits from this behaviour because a rising tide lifts all boats, albeit only on an absolute level (the only thing that should matter) and not on a relative basis, causing the jealousy we see today with people complaining about wealth inequality. I suggest we treat them the same as any crying jealous child: tell them to work harder and if they steal from other kids or break their toys give them a time out.

[LC]

I see we have been relegated to the politics forum. Our biases are too strong, rk :D :D :D

 

Regarding the quote it is a small matter - yes finding out you are underpaid sucks. If you are underpaid, you can:

-Live in an ignorant bliss where you do not know it.

-Try to negotiate a higher wage, either successfully or unsuccessfully

-Do nothing about it

 

I just find the argument that the intangible downside, i.e. "it makes people feel bad", to not be a good one - when the potential upside is actually tangible (raise or new job).

 

In terms of the US....we can debate endlessly. The indicators are out there - we will select the ones which support our own conclusions, but perhaps this is not the topic to do so.

[LC]

3) is wealth inequality a problem?

No quite the opposite. Value creating behaviour in society needs to be sufficiently rewarded to motivate those able to  to actually do so. The rest of society benefits from this behaviour because a rising tide lifts all boats, albeit only on an absolute level (the only thing that should matter) and not on a relative basis, causing the jealousy we see today with people complaining about wealth inequality. I suggest we treat them the same as any crying jealous child: tell them to work harder and if they steal from other kids or break their toys give them a time out.

Oh I agree on the treatment. When a child takes all the toys for himself, take the toys away and give him a time out before he can play again with the other kids.

[rkbabang]

3) is wealth inequality a problem?

No quite the opposite. Value creating behaviour in society needs to be sufficiently rewarded to motivate those able to  to actually do so. The rest of society benefits from this behaviour because a rising tide lifts all boats, albeit only on an absolute level (the only thing that should matter) and not on a relative basis, causing the jealousy we see today with people complaining about wealth inequality. I suggest we treat them the same as any crying jealous child: tell them to work harder and if they steal from other kids or break their toys give them a time out.

Oh I agree on the treatment. When a child takes all the toys for himself, take the toys away and give him a time out before he can play again with the other kids.

 

You, like most leftists, are confusing "takes" and "earns".  "Takes" is when someone takes what someone else creates/earns through force or fraud (i.e. theft, taxation, etc).  "Earns" is when someone creates wealth in the free market without using force against another human being through labor or creativity and it is rightfully theirs.

 

[LC]

The topic is literally about not telling underpaid workers that they are underpaid.

[Gregmal]

An employer finds a value investment(a good worker at a great price). What's wrong with this? Do we need to do everything for everyone now? If, as an employee, you feel underpaid, go test the market. If you're content, great. Who gives a shit what the guy next to you is making? If he's negotiated a higher deal, has better friends, is screwing the boss, that's really none of your business; not to mention if it leads to a higher salary maybe something you should consider doing too.

[undervalued]

Based on the poll, I would say 59% of the people who answered are employees. :)

[LC]

Take a look at sports leagues for the exact opposite situation.