Earnings vs Worth

D

Dr Who

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Hi All

I am in the lucky/unlucky position to be the one to review all my staff's salaries annually. This would include increases, bonuses and promotions. I have also seen alot of payrolls in my life so I have a fair idea of what the average man/woman has been earning for ages.

What I find so impossible is that more and more nobody is ever satisfied no matter what they get, if you raise a staff members salary by a significant amount over 2 years it becomes an expectation or if you hire someone who is overpaid but is needed and you give them modest increases they are also not happy.

Is this a 3rd world issue when CPI is not really 6% and everything is going up ? As you speak to people in UK , USA and often increases are few and far between yet they are just happy to have a job. Have we become a society which is never happy or is this a myth?

The other item which has been discussed on many occasions is that you should be paid based on the work you do, so if you are asked to do an extra task then you should be compensated for this? My view is that we all should be looking for more opportunity as this might turn into long term wealth/success. But imagine if that was true everytime you take a task away do you then reduce a persons salary?

What is seems is that people at different levels of organisations have a different view on the above, while lower level staff see it as more money for more work those of a senior nature see it as part of the job description. Do you think this is a education issue or just a seniority issue?
 
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The problem is that inflation is nowhere near 6% for the middle class. I estimate it to be in the region of 14%. That is the real cause of the problem. Basically if you do not get that type of increase, you are earning less. And in fact that is also more or less the rate at wich the Rand has been devaluing for the past 5 years.
 
Dr Who said:
while lower level staff see it as more money for more work those of a senior nature see it as part of the job description.
Click to expand...

Of course, the peasants must break their back for free to line managements pockets.
 
The cost to keep the same standard of living has increased more than the CPI due to many "luxury" goods becoming more expensive due to the rand falling versus the dollar.

For getting a flagship phone contract 2 years you would pay something like R400 for a good contract, now it is around 500-600 rand. That CPI index is based more for those who earn less such as mine workers.

Also, electricity just went up quite a bit on top of that. Lots of people are worried that the Rand might drop even more and that they could not keep up their current lifestyle, so they ask for more now because they can only ask for more again in a year (depending on the contract).

Many employees also believe that salary should increase due to them becoming more skilled for working longer at your company, they could fill the roll better than someone completely new to it who you just brought in (which is generally true).
 
Problem is that everyone thinks they are sh*t hot at what they do. If you are, go get another job or start your own company if it's so easy.
 
Well, like you I am that guy - the guy who sees, determines and approves salaries.

IMHO - I lecture at Stellenbosch from time time and at DUT from time to time as a guest. I then bring the students into the plant for a month to six months for experience.
My first comment is the old question - is money a motivator. IMHO - and not to debate the issue - I say it is. The business exists for money, we work for money to use to barter for goods and services.

Then, I explain that expectation and reality rarely tie up. A graduate expects a big salary, without in all reality asking what value he or she adds to the business.

The starting salary is always the easy part - the person needs a job, and needs money - the wants come later and hence the discussion or question you raise.

In my case, I have unionised members and non unionised people. Obviously - the one looks at the other. When workers strike - as is their right - I expalain that as wages are negotiated at a sectorial level rather than plant, well theres not much I can do for them. Having said that, the non unionised and managerial staff are quite capable of doing the work, and often it is what keeps us going.

For the non unionised guys - we pay in bands - roughly guided by the Hays model. We used have a policy of salaries are confidential, but I have done away with that. I know people discuss salaries, and I believe its a good thing. It permits a level of transparency. But then, the job evaluations MUST be done.

Everyone, without exception, believes they are worth more than they are paid. Its human nature.

For the lower levels - task manual work, indeed I pay more for the work rate and work complexity, but again I am also bound to a collective agreement.

For the higher levels, well, an annual raise, upto about three years ago, was just expected. But, we had to come to point where we told our guys - no increase this year. This impacted the directors down to mid management. Those who wanted to leave, left. Those who stayed - stayed.

The only aspect we didnt change - no matter what, was the bonus cheque. We budgetted this and continue to do so. This is a part of the remuneration for going the extra mile.

I also think, the pay, benefit, grade scheme would depend largely on the type and nature of the business involved.
 
Inflation, tax, interest rates and then currency depreciation. If salary doesn't keep close to these factors you actually decreasing it much like annually goods & services appreciate in cost. I don't hi k I know of many companies that have kept their prices the same without going out of business..

Exception being companies that have over priced for capital & have been forced to reduce and then you can see the difference it makes of staffing for that sector.. See Telecoms
 
Many employees tend to live beyond their means and then attempt to shift the responsibility to their employer by demanding more pay.

This demand is in most cases not justified by their actual performance.

What I found helpful was to brief my staff on financial life skills.

Most of them were drowning in debt and used a large portion of their take home pay to service that debt, but in a haphazard manner.

I would help them (individually, to ensure privacy) by analysing their debt and them drafting a debt repayment plan and then monitoring them monthly.

After a while the impact on the workplace was tangible. It became a happy place where staff enjoyed their work and visitors enjoyed being caught up in the atmosphere.
 
If you're happy to take 6% on your R70 000pm (R50 400 pa) how can you begrudge me 6% on my R25 000pm (R18 000 pa)?
 
I thought it stood for something else because your calculations are weird.
 
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