Introducing Open Salaries at Buffer(open.bufferapp.com)

527 pointsby jliechti113 tahun yang lalu337 comments

open.bufferapp.com

http://open.bufferapp.com/introducing-open-salaries-at-buffer-including-our-transparent-formula-and-all-individual-salaries

337 comments

tikhonj13 tahun yang lalu

I've always felt the culture of hiding salaries was doing a significant disservice to employees. It creates a significant and largely artificial information disparity, giving a major market advantage to the employer. In turn, this makes the entire labor market less efficient for the employee.

This also makes the employer less accountable to the employees. The employer can easily pay somebody significantly more or less than they contribute, and the rest of the team cannot really say anything about this.

Now, there are some cultural reasons to do this--preventing jealousy, hiding inequality. But it really feels like a social band-aid, a temporary solution hiding the symptoms but not the underlying problem. Besides, everyone ends up having a reasonable guess as to who makes more and who makes less anyhow! The same dynamics develop, just with more uncertainty.

On the other hand, making salaries public takes these problems head-on. Inequality isn't bad in and of itself; some is basically necessary. But hiding that fact doesn't really help anyone. Instead, forcing people to see it head-on, deal with it and talk about it is probably a better solution.

I really applaud Buffer and the general movement towards transparency. I think it's a very healthy cultural progression and hope it catches on more widely, so that people stop having knee-jerk reactions to salary information.

EDIT: As an interesting additional note, all salaries (beyond a token minimum) at Berkeley (and the whole UC system) are publicly available at http://ucpay.globl.org/.

I've looked up various professors at the ParLab (where I did some undergraduate research). The fact that their salaries range from ~120k to ~350k did not change my perspective of anyone and did not seem to affect the lab's culture at all.

Essentially, I'd be perfectly happy to see this outside of public universities.

JonFish8513 tahun yang lalu

Let's say I'm a competitor, and I find that Niel (randomly picked) is someone I want to hire. All else being equal, I offer him $100k (website says he's making $88k). He comes to his boss to say "I like it here, can you match it?"

What does his boss do? Especially, if he's valuable to the company...

What if I have a very specialized skill that doesn't fit nicely into your matrix? Let's say market pay for my skill is $200k. Do you create a new category for me? Do I get dirty looks from all of my co-workers because I have a valuable skillset that most people don't?

I'd hate it, as an employee, as a boss or as an investor. But that could just be me.

suprgeek13 tahun yang lalu

Excellent concept - but one major Caveat. Why in the world would you publish it for all the world to see?

Keep it internal to the company - you have an expectation of privacy from your employer and this post just ruined it completely.

I hope they got written signed releases from every one of those folks whose private info they broadcast to the world.

kapilkale13 tahun yang lalu

Seems unwise to have a CEO co-founder be the highest salaried employee at a startup.

That person's equity position is probably at least an order of magnitude higher than the other employees. As an investor or employee, I'd find this alarming.

http://techcrunch.com/2008/09/08/peter-thiel-best-predictor-...

Call me old fashioned, but I think co-founders should be paid living expenses + 25%, even in a series-A funded startup.

danso13 tahun yang lalu

Wow...the engineering salaries are significantly lower than I would've expected for a well known startup in the Bay Area...at least compared to the perceived range for such things.

Note: a less cynical take is this: GodDAMN buffer employees must be happy working there if they tolerated transparency to this level...which, really, is the best win-win for all kinds of transparency scenarios.

carsongross13 tahun yang lalu

I like this idea, but with a few modifications:

* Names should be anonymous. Everyone knows where they are within the group and can determine if its fair without knowing exactly who makes what.

* It should include options and bonuses. In some companies non-salary compensation dwarfs salaries, and it's dishonest to point to a CEO salary and say "Look, he only makes 1.something X what regular people do."

* Keep it internal to the company. No point in giving the competition an exact target or requiring whole company buy in before you do it.

* Allow people to redact their own information, but display it as having been redacted. If enough people do that, or just management does it, everyone will sense that things are unfair.

sytelus13 tahun yang lalu

Things I learned today:

* Buffer is not somebody's weekend project

* It needs 16 (yes, SIXTEEN) people to run that thing

* They actually have revenue. In millions. $2.3 Millions!

* Their company values are based on How to win friends and influence people.

Aside from that, open salaries are pretty naive idea, if not completely dumb and dangerous. The lives you live everyday is in effect a game (as in "game theory" game). When you are talking to person, selling goods or buying one you are in the game. Like in any game, information is your advantage and your opponents weakness. This is exactly why privacy matters. If insurance company knows you eat too much pizza, they would want to get a higher premium from you. Similarly if a car dealer can look you up and figure out your salary, he can adjust his negotiation tactics. A plumber making half the money you do would want to charge you more than others. And so on. When all these people would look for their next jobs, their next employer would know how much salary to offer them.

dsugarman13 tahun yang lalu

I have a feeling you will regret this soon. There are certain benefits in having a firm salary structure sponsored by a transparent system, but the loss of flexibility will hurt in ways you haven't experienced. Also, letting everyone know what their peers make can cause disgruntled employees.

iampims13 tahun yang lalu

It’s one thing to have a transparent salary policy, it’s a whole another world to publicly blog about people’s salary with a link to their Twitter account.

I hope all employees agreed to have their salary published on the buffer blog.

Kudos to them for trying something different.

dxbydt13 tahun yang lalu

Back when I was a really dumb undergrad, I did some work for a company & they asked me where to mail the cheque. I gave them the University address. So I was chatting with my professor & we walk by the mailboxes, and by pure reflex, I reach out into my mailbox & grab my mail & he does the same & we say our goodbyes & go home.

Now, I open the mail at home & am staring at my professor's salary! You see, the secretary had switched our mails by mistake because our last names began with the same letter. I was quite stunned by the number - it was a measly sum, and I did the math & worked out that the Professor's salary was about 60K. Now, I knew my Professor was an important CS scholar & had tons of papers to his name, but that low number irked me. After the PhD and all these papers, just 60K...why..?

At the same time, my Professor had also gone home & opened his mail & was staring at my salary! So much money for some dumb undergrad who was basically an average student & had no major publications or research! He was quite bothered.

The next day, we had a very awkward exchange of mails. But from then on, the student-teacher dynamic completely changed. I suddenly began getting B's instead of C's & even occasional A-. He probably felt, hey if this guy can get so much money in the market, he probably knows his shit. otoh, I began to respect him & the CS program less & less. So I still have to spend 3 more years & take 45 more credits & do the qualifiers to get the PhD & then write all these papers & for what..60K ? That was my attitude at the time.

Needless to say, I dropped out of the PhD pgm with a Masters & went to work full-time. That was the stupidest thing I ever did, but I just didn't know it then. Now, I look back & think...hey if I hadn't known about his salary, I'd have slogged it through & actually gotten my PhD instead of half-assing it out here :(

ra313 tahun yang lalu

Can't say a lot of good things about a company that pays a "Chief Happiness Officer" more than most of its engineers. I know plenty of startups that seem to be doing alright in the customer service department without an overpaid exec heading it.

Does she really contribute more to the bottom line than any of the other 4 underpaid engineers?

mrkmcknz13 tahun yang lalu

Very humbling that no one at Buffer would call themselves a "Master", indeed many would probably but Joel at that level but he sits there on a 1.2x multiplier.

I once had a conversation with an old hat who said "If you call yourself a python master you better be fucking Guido."

YZF13 tahun yang lalu

One result from behavioral economics is that people care more about their relative standing to others than the absolute value of the salary. This is why transparency can be a double edged sword. If I think I deserve to be paid more than Joe, as long as I don't actually know how much he's paid I can believe that I'm being paid more. However, once you have transparency and I can see Joe is getting paid more than myself this will probably have a negative impact on my morale and performance.

One example I've heard discussed (I think by Dan Arieli) is how transparency in CEO pay has failed to bring CEO salaries down. One problem is now CEOs can see what other CEOs are getting paid and naturally every CEO will want to be paid higher than his peers.

I used to think open salaries would be a good thing but lately I'm not so sure. You definitely want to tread very carefully there as there are many implications and unexpected consequences.

zhuzhuor13 tahun yang lalu

I found one thing interesting is that only 4 out of 17 people choose equity over $10k salary. Even CTO chooses salary.

I am curious if this is common in startup companies, since I have never worked in startups.

vladgur13 tahun yang lalu

Wow, these salaries seem to be pretty low. I mean a senior IOS engineer making $107K in SF? Id expect them to easily increase their salary by 30% by jumping ship.

rmason13 tahun yang lalu

I wonder in five years looking back whether Buffer getting hacked or their 'transparency' will have hurt them more. I am betting the latter.

Do they really think they can ban private emails between engineers? it would have been much easier to simply load eavesdropping software on their computer if management doesn't trust them.

I really like Buffer but I'm a little worried about them.

benaston13 tahun yang lalu

When the market shifts, or for tactical reasons you have to pay more to recruit someone, you instantly have a problem.

nsxwolf13 tahun yang lalu

Seeing these pathetic salaries (and in the Bay Area!), I don't feel so bad about my boring enterprise development position at no-name established corporation anymore.

freyr13 tahun yang lalu

Many people here are picking on the senior developers salaries, hovering right around $100K. Maybe this isn't a particularly competitive startup salary, but note that salaries are tied to revenue.

If the company's revenue grows significantly, their salaries could become much more attractive. If, for example, revenues grow from $2M revenue to $20M revenue, senior developers would see their salaries increase by $54k or ~50% over this time.

It could be argued that 10X growth or an $18M increase in revenue is unrealistic for a tweet scheduler, but that's for the employees to determine.

zmitri13 tahun yang lalu

I have a question: Why would the founders take such high salaries?

Seems to go against everything I would think was important for a company that is venture-backed.

corry13 tahun yang lalu

Serious question: Why aren't equity positions posted too?

To me, that's part of the trade-off that the startup founder / leaderships takes (for good or ill), and seeing salary in the absence of actual equity positions is only half the picture.

Hopefully they all know each other's equity positions internally and just chose not to share publicly... otherwise it would seem like a betrayal of the open culture if the actual ownership structure of the company wasn't openly known and discussed.

jballanc13 tahun yang lalu

Imagine if you went to the store to buy bread, but you didn't know how much all the other people in line were paying for their bread. When you get to the counter, the baker charges you some arbitrary amount. Today you have enough money to buy bread, but the baker warns you that he may charge more tomorrow. Since you don't know what anyone else is paying for their bread, you can't have any idea if what the baker charged you is fair or not. All you know is that you need to work as hard as you can so that you can be sure you will be able to afford tomorrow's bread.

Of course, this doesn't work. Nobody is preventing you from asking your neighbors what they paid for their bread. Once you know what a "fair" price for bread is, then you know exactly how hard you need to work to afford bread, and you have little incentive to work any harder than that.

If you own a company, ideally you don't want your employees competing with each other. You want each of them to compete with themselves, pushing their abilities, growing, learning, improving. You don't want them to know exactly how much they need to do to earn that next promotion, because then they will have little motivation to do more than the bare minimum.

If you own a company, unlike the baker, you can have some amount of control over the flow of information. This control allows you to manipulate your employees motivations. Like any amount of control over anything, this control can be abused...but in capable hands it can also be wielded to great effect.

An open salary policy gives away that control entirely...

dj-wonk13 tahun yang lalu

I've read dozens of the comments on this page so far. The thing that jumps out to me is the interplay between these factors: (1) internal transparency (2) external transparency (3) internal privacy (4) external privacy (5) human motivation and (6) company culture. There are many combinations here, and I can't help but think Buffer didn't do an effective "search" across the possible "parameter space", even according to their own goals and interests.

For example, Buffer could have easily added a policy saying that each employee's compensation may be adjusted by, say, +/- 20% based on individual factors. That would give some uncertainty, and thus a bit of individual privacy. Peers would still have some confidence that they were, more or less, in a similar range as others with their public performance characteristics.

Let's put ideology aside (i.e. do we want this to work, according to our theories of human nature) and focus on the actual effects. How do you know if you've succeeded? How do you measure this? How do you design the experiment?

Call me skeptical, but I can't help but think that Buffer is doing this, largely, to say "look at us!" and "this makes an interesting blog post!".

newobj13 tahun yang lalu

Well, Sunil and Colin, seeing that you are criminally underpaid, are you interested in opportunities elsewhere?

I will figuratively eat my underwear if you don't come to regret this strategy (public, non-anonymous open vs. internally open) at some point.

symfrog13 tahun yang lalu

This post reminds me of Miley Cyrus at the MTV VMA earlier in the year. Pop singers are incentivized to be the first to break cultural norms for no practical reason in order to ride the wave of subsequent teen followers.

In the same way, posts like these are created to be the first to break a specific norm (i.e. do not post employee salaries publicly) in order to ride the wave of traffic (and hopefully a few additional users).

Euro_IT_drone13 tahun yang lalu

Just trying to compare here with my European salary.. How much of this do you get to take home, ie. what part of it can you spend on food, clothing, housing etc. after takes? What about health insurance, is it provided for?

dmourati13 tahun yang lalu

Wow, those salaries are low. If I was making that much and someone posted my salary to the internet, I would immediately quit.

icambron13 tahun yang lalu

I actually love the radical transparency here, even after reading all the warnings in the HN comments.

What I like less is the salary formula. What's going to happen is that all of the negotiation is going to get packed into the experience and seniority multipliers. It creates the illusion of rigor and possibly does more harm than good.

overpaidprobly13 tahun yang lalu

Does anyone have an opinion on how these numbers square with market rates?

I make $113k/year as a juniorish engineer at a VC backed startup in SV. Am I hilariously overcompensated?

joshuaellinger13 tahun yang lalu

I always thought the best system would be to tell people what their boss makes, including options and other non-salary compensation.

This eliminates the problem of people comparing themselves to their nominal peers on incomplete information. It really tells you everything you need to know about compensation.

But the most valuable part of the buffer system is the formula. You have a framework for calculating what is fair.

One of the dangers at small busy startups with well-intentioned leaders is that you basically forget to give people raises and your employees don't get you to correct it until they are pissed enough to quit. That's part of why I left my original company and it cost me a good employee recently.