Our Simple Salary Policy
This post is part of a series about our VERY FEW company policies. Read this intro post for some context.
Given that we have different people all around the world and that we are 100% open books internally (i.e. everyone knows how much everyone else makes), it helped to come up with a salary policy that was both simple and fair.
Here's what I came up with:
You are paid a little better than someone with your same job in your geographical area.
The goal of this policy is to remove salary as a something employees think about. Basically, people at Balsamiq should know that they are paid well compared to their peers. In other words, Balsamiq employees are not going to find a better paying job somewhere else, unless they are willing to move. And if they are, we're open to that and we'll adjust their salary accordingly (both up and down).
Once a year or so, I review the local averages from sites like careers.stackoverflow.com, salary.com as well as the Italian contracts and look at how much each employee could get if they got a similar job in their same geographical location now, and we adjust each person's salary accordingly. It's subjective, but we discuss it together one-on-one and come up with a figure that makes both of us happy (my dad tought me that it's only a good deal if both parties walk away happy about it).
I agree with Dan Pink that carrots and sticks don't work for a company like us. I want salary to not be part of the equation, people should do their best work not for a raise, but because they want to. Again, see Dan Pink's book: people want Autonomy, Mastery and Purpose, all things I try to provide as an employer.
This is the base salary. To participate in the company's profits, we also have a generous profit sharing program as well.
That's it! What do you think? What's your company's salary policy? How would you improve ours?
Hope this helps,