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This new rule could reveal the huge gap between CEO pay and worker pay

Discussion in 'Sports and News' started by YankeeFan, Aug 5, 2015.

  1. YankeeFan

    YankeeFan Well-Known Member

    You don't like the fact that a fellow employee with less experience and fewer skills makes $70,000 too?

    You're an asshole!

    Hey, look how much the boss makes compared to us:

    Thousands of public U.S. companies are likely to soon be forced to share a number many would rather keep under wraps: how much more their chief executives make than their typical rank-and-file employees.

    The Securities and Exchange Commission is expected to finalize on Wednesday a long-delayed rule forcing businesses to share their "pay ratio," a simple bit of arithmetic that would cast an unprecedented spotlight on one of corporate America's thorniest debates.

    Once the pay-ratio rule is in place, millions of workers will know exactly how their top boss's payday compares with their own, revealing a potentially embarrassing disparity in corporate riches that many companies have long fought to keep hidden.

    While the average American's pay and benefits have been growing at the slowest pace in 33 years, executive wages have soared. Fifty years ago, the typical chief executive made $20 for every dollar a worker made; now, that gap is more than $300 to $1, and it's growing.

    This new rule could reveal the huge gap between CEO pay and worker pay - The Washington Post
  2. Ace

    Ace Well-Known Member

    Business leaders don't like it because it could be "embarrassing."

    Damn straight, skippy. That's the idea.
  3. YankeeFan

    YankeeFan Well-Known Member

    I think people are more likely to compare their pay to the median, and be upset about where they stand, similar to what happened to the $70,000 company.

    Everyone making less will be pissed. Those making more will be surprised by how close they are to the median, considering the number of "low skill" workers the company employs.

    Also this:

    But greater transparency also had unintended consequences: Comparing executives at rival firms led companies to notch their top-level pay higher every year to keep their leaders onboard, an upward spiral that ensured the pay gap would continue to grow.

    It's going to lead to higher, not lower, executive pay.
    Jeff likes this.
  4. MisterCreosote

    MisterCreosote Well-Known Member

    Disclosing the pay of a company's "median worker" — the line at which half the employees make more and half make less — could also become a human resources nightmare, exposing the raw and awkward tensions of workplaces undercut by growing pay gaps.

    "This is going to sensitize every single worker to how it is they compare in pay to folks within their organization, and folks who do the same job at competitors," said Steve Seelig, a senior regulatory adviser for Towers Watson, a human resources consulting firm.

    This, yeah. There's a reason why people always say to never talk about salary with your colleagues. I'll bet this rule causes more friction among the "rank-and-file" than it does between them and the bosses.
  5. cranberry

    cranberry Well-Known Member

    I'm generally all for anything that makes people wake the fuck up and begin asserting themselves. One of the first thing Marvin Miller did when he took over the Players Association was suggest to players that they share their salary figures with each other.
    Huggy and I Should Coco like this.
  6. YankeeFan

    YankeeFan Well-Known Member

    In general, workers knowing their value is a good thing. It certainly gives them an advantage when negotiating salary.

    But, some people will be upset when they realize they, and their work, are not highly valued.
  7. YankeeFan

    YankeeFan Well-Known Member


    It's all political. It's designed to help foster class warfare, which Dems think they can use to their advantage. That's it. There's nothing practical about it.
  8. bigpern23

    bigpern23 Well-Known Member

    Yep. It's so the company can keep labor costs down. The only people who benefit from employees not speaking to each other about their salaries are those who have to pay them.
  9. Ace

    Ace Well-Known Member

    Personally, what I make compared with others does not bother me so much. Some people have different skills. Some are better negotiators, some lucked out, whatever.

    And at the $70,000 company, those whiners who quit would do well to look at a parable Jesus taught about harvesting the fields. Be happy with what you signed on for and don't worry so much about other people.

    My big workplace gripe is the do-nothing folks who spend 90 percent of their time sucking up to the bosses and trying to create the illusion of what great employees they are. And they seem to get promoted all the time!
  10. trifectarich

    trifectarich Well-Known Member

    I'd also be interested to know how all this is defined. It's one thing to know the CEO makes a million a year; it's another to know 100,000 shares of stock are doled out every year, he gets to use the company jet for so many hours every year, plus the mountain retreat, he gets his mortgage paid, yada, yada . . .
  11. doctorquant

    doctorquant Well-Known Member

    Stuff like this is silly. What does it matter how much the CEO is compensated relative to you? Do you really think if the CEO were compensated less that you would be compensated more? If you think that, you are a very, very foolish individual.

    Alternatively, suppose you're a mid-range employee at a firm that pays people like you particularly well. Let's say you make about 20% more than you would elsewhere. Further suppose your firm's CEO makes 100 times what you do. Would you rather be in a place that pays you less but at which the CEO compensation is only 70 times what you make?

    Or, suppose you make about average for your position/qualifications. A company with the CEO ratio at 100x offers you a 20% bump. You're going to turn that down because in your present gig the CEO makes relatively less?
  12. JackReacher

    JackReacher Well-Known Member

    People looooooooooooooove to bitch about how much other people are making, CEOs in particular. They're all the devil! And much, much less qualified than I am!
    doctorquant likes this.
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