In Norway, salary information is viewed as public information. Each year the government releases the income, assets and amount of payed tax of every citizen, so that the media can make it public. It is then made searchable online, for example here: http://skattelister.no/
Warning: Look at these databases at your own risk. You may be shocked at what others at your company are probably earning. Google H1-B salary database.
Fog Creek has secret profit-sharing plans. All Joel has done is move a portion of employees' compensation from the "salary" column to the "profit-sharing" column.
If Joel were to begin posting the annual profit sharing of all employees, including Michael and Joel, then this article would make sense. But until then, it's just flair.
Honestly, I know it sounds too good to be true, but all compensation is completely open and honest.
Just to be clear - does that apply to Joel and Michael too? If so, a tip of the hat to both of them.
I like the idea of transparency with salaries as long as the company pays well. If an employee decides he/she wants a higher salary than is afforded by a system like that they can look for another job or start their own company.
So, joel may make a lot of money, but i seriously doubt he's half, or even 10% of the profit sharing money. I also wouldn't count out the idea that some employees (other than Joel and Michael) have stock, so they get paid again when profits are distributed.
employees are rich. shareholders are wealthy.
It kinda implies that while in school you couldn't have possibly picked up any experience that would define you above someone who has a year of industry experience.
I was going to read this article, but halfway through the first paragraph some stupid ad blocked my view. I'll definitely think twice before clicking through on anything pointing to inc.com again.
Wow, talk about self-important. People have a term for something you just took a paragraph to explain. Can you guess why? This comes across as a pointless dig to make yourself feel superior.
"is this the UDA? / Or is this the IRA? / I thought it was the USA / Or just another country" (c) Sex Pistols
Fog Creek is free to compensate people in this manner. You are free to seek employment elsewhere if this is a problem.
It would not be a free market if either A: the government mandated this approach (or worse, mandated the pay scale) or B: an oligarchy formed where everybody determined compensation the same way. So far, neither have happened.
(Ironically, many people's proposed solution to various problems caused by their not liking one particular centralized entity's choice is to centralize the entire market into one entity. You didn't say anything about that, I just can't resist pointing that out. Unionizing programmers could have this effect, though.)
If there was no built-in scaffolding of corporate status and corporate law, and it were just individuals operating in a free market forming whatever arrangements they want via private contract law, it's at least possible that large, centralized entities wouldn't emerge as easily or as frequently. From that perspective, the modern "sea of centralized entities" version of capitalism is itself centrally planned: the government decided that it'd be best if the economy were made up of a sea of centralized entities, and wrote the rules so that it happened.
The key question, then, when applying to a company for a job, is do they have the profit to throw my way?
If they are worth X, but I can only pay Y (where Y < X), then I pay Y (and hope that they'll work for Y) until I can afford to pay them X. At that point, I raise their pay to X.
Also note that, if they are worth X, but you can only pay Y, this should only be a temporary situation. Because, if they are truly worth X, then once you hire them there should be no reason you cannot afford to pay them X eventually (since they are bringing that value to your organization).
