The critical thing here is that if pay was uncontrolled, then skilled employees could market themselves to the highest payer, and that would put more of the profits of the work of those employees into employee pay instead of into company margin (aka profit).
It is pretty clear when you look at the revenue per employee numbers at some of these 'digital product' companies (specifically Google and Facebook), that rank and file employees are not sharing equally with management in the returns.
That is not to say that pay is bad, or that wage theft is going on (extreme positions), employees in California at least are at will and can quit at any time to offer their services to another player. The regulatory requirement though is to identify and prevent collusion between those players in keeping salaries low.
> That is not to say that pay is bad, or that wage theft is going on (extreme positions), employees in California at least are at will and can quit at any time to offer their services to another player. The regulatory requirement though is to identify and prevent collusion between those players in keeping salaries low.
Wait, but isn't this situation actually making them getting hired at other players much more difficult due to the collusion?
This is the part of the whole internet-anger about this I've never understood.
I hate having recruiters call me. It's actively annoying. Having only Facebook recruiters call me was strictly better than the alternative that all major tech company recruiters cold call me, which started happening right after this broke.
I'm totally in favor of distributing more profits for all enterprises to workers, tech workers included, but "we agreed to not annoy one another's workers, but we're happy to hire when they apply" isn't really the story people tell. But that was my (and it sounds like your) experience of this.
I expect he means rank and file employees including middle management vs. Execs, which is probably limited to the set of people who are VP or above. (maybe Director, but I think the data would disagree).
Yes, I was generally draw the line at the same point, although I expect Director is in there too. Much of the director and above remuneration is in stock and bonuses which benefits disproportionately from profit.
From what I've seen, director level compensation follows mostly the same structure as non-director compensation, but with the dials turned up in much the same way. That is to say, L5 -> L6, L6 -> L7, and L7 -> L8/Director modify your compensation structure in similar ways.
This ignores things like truly discretionary cash bonuses and one-time stock grants which exist, but I'd have no visibility into.
> This ignores things like truly discretionary cash bonuses and one-time stock grants which exist, but I'd have no visibility into.
Having played at that level my experience was that generally they start at 100% of your 'base' salary and go up from there. Much of the knobs are intentionally opaque.
I was told by someone in HR that has HR friends at Google that the manager of a group always makes at least as much as the highest paid employee in that group.
Your friend of a friend lied to you. Comp is mostly based on level and performance and it's totally possible to have a higher level employee reporting to a lower level manager.
That's the plan, but it doesn't always happen due to internal transfers. Anyway it means little because if you are highly paid then you also are high level title so you just get managed by your manager's manager but stay working on your same team.
It is pretty clear when you look at the revenue per employee numbers at some of these 'digital product' companies (specifically Google and Facebook), that rank and file employees are not sharing equally with management in the returns.
That is not to say that pay is bad, or that wage theft is going on (extreme positions), employees in California at least are at will and can quit at any time to offer their services to another player. The regulatory requirement though is to identify and prevent collusion between those players in keeping salaries low.