Are you being paid fairly?
I need an honest answer.
I’ll go first.
If I’m being totally honest, in over 20 years doing the startup thing, I’ve been underpaid way more often than overpaid. I’m willing to bet your answer is similar.
I used to think salary didn’t matter, because I love what I do. But along the way I’ve learned that it’s critical to get employee pay right from the beginning, whether it’s the pay you’re taking home, or the pay you’re handing out.
So how do we do that? It seems simple enough. The company pays its employees what they’re worth, by assessing their motivation, getting to value, and avoiding some basic mistakes.
But don’t misunderstand me. The calculations the company uses to determine that worth may not always equate to what employees and prospective hires actually want.
Small Outliers Add Up Quickly
Long story short: The company needs to value their employees properly, and employees need to value their jobs properly.
Those two value systems have skewed pretty dramatically and diametrically over the last three to four years. Today, finding the proper value requires a balancing act, and a few outliers here and there can eventually throw everything out of whack.
Yeah, sure, maybe the company spends a little more on a rock star employee to keep her away from a competitor, or maybe they save a little by getting a great deal on a developer who doesn’t realize the magnitude of her talent.
They can do that once, maybe twice, but it’s going to quickly spiral into a major crisis as the company grows. Every successful company eventually comes to a crossroads, at which point they’re faced with leveling employee pay up or down to keep the balance intact.
This almost always causes problems that are bigger than the benefits gained by doing it in the first place.