Equal Pay

[andrewducker]

News here that companies have been told that length of service is _not_ a good enough reason to pay people more.

And, I have to say, about bloody time too.

True, longer service can lead to greater levels of experience and thus better productivity and usefulness from an employee - but it doesn't have to. If someone is being more productive/useful then they should be rewarded for that - paying them for length of service is jut a lazy way to avoid thinking about someone's actual contribution.

It also biases the system against women. It's very easy to justify paying women less when you can point out they've taken a year (or two) off to raise kids - but unless that has an actual, demonstrable affect on their levels of productivity, it's irrelevant.

Comments

[heron61.livejournal.com]

Damn you and every other person in the EU. The US is legalizing torture and disappearing people and you lot are actually passing laws to make life better and more humane. It's not even remotely fair...

[andrewducker]

To be fair, we're also having problems with stupid laws being passed - just not quite as stupid as your lot are passing...

[missedith01.livejournal.com]

The change you describe discriminates against the indolent! To the barricades!

[spaj.livejournal.com]

Oh no! The Indolent are trying to organise a riot.

The government finally figured out that despite the fact that since what? 70% of the counry are too lazy to vote, they're probably also too lazy to complain, or do anything else at all.

So they can screw them in the eye! ;)

[missedith01.livejournal.com]

Yeah, the indolent didn't turn up. Apparently, they didn't get the memo.

[pickwick.livejournal.com]

Huh. This could affect my work quite a lot, actually. There are people who've been here 20 years or so, and because it was such a new, technical, professional job when it started, those people are still being paid about twice as much as me, I think.

[drainboy.livejournal.com]

I own a company and person A has been there for 20 years. They're no more talented than person B who I just hired but they stuck with me through thick and thin, through the months everyone got paid weeks late, through the low times when the company wasn't doing well and everyone was taking pay cuts, they stuck with me with diligence and belief that things would get better when others walked out. Finally the company's doing better, so I hired person B who happens to know just as much about their job as person A. However, person B might well quit in a week for an extra £1000-a-year elsewhere but I'm not allowed to reward person A with higher pay (do bonuses come into this, as conceivably they should) even though I know they'll continue to stick with me due to the intense loyalty they've shown in the past?

Sure, not all situations are like this, but doesn't company loyalty count for something? If so, how would you deal with this situation?

Generally speaking, I like the idea of this law though. I just reckon it'll screw over some peopple whilst helping others.

[missedith01.livejournal.com]

Presumably there would be some way to objectively pay person A more based on experience. It's only a decision purely based on length of service which is dodgy.

[guyinahat.livejournal.com]

I think the problem here is you're defining talent to exclude company loyalty. For appraisal situations, I would think talent shouldn't just be technical skills, but also the wider picture of what someone brings to the company.

Whether the law will allow that though...

[andrewducker]

If you're rewarding person A for sticking about then give them a reward - a bonus for doing so, or make up the pay that they lost in the cut. Paying them more year-on-year for doing the same work isn't the right way to reward them for single actions.

[drainboy.livejournal.com]

But what if you want to reward continuing loyalty? Because hiring and training people costs a lot of money, you'd prefer to have low staff turnover. It also leads to a nicer workplace environment, so how do you do that apart from rewarding people for staying? A yearly bonus based on how long they've stuck around? That's the same as paying them more for sticking with the company.

I'm still not saying the law is right-minded to stop people using time-served as an indicator for pay, but I still think that perfectly sensible time-serve-related attributes that companies actively like will be unfairly challenged.

[andrewducker]

And I think it's exactly this they're trying to discourage - rewarding people just for hanging about.

And I have to agree that rewarding people for just this is a terrible idea - recruitment costs make it worthwhile to keep people on for a bit, but not indefinitely. And if it's expensive to replace someone whose been there for 6 years it's equally as expensive to replace someone whose been there a year.

If by sticking about they've become more knowledgable and better at their job, reward them for _that_.

[drplokta]

The FT seems to take a rather different view of the judgement (article will disappear behind a paywall shortly).

[andrewducker]

Interesting - cheers.

I don't actually have an objection to experience affecting pay - insofar as it's justifiable and relative to the amount of extra usefulness that experience grants. i.e. someone with 2 years experience is definitely worth more than someone with 1. But 15 years vs 14 isn't worth the same differential.

[guyinahat.livejournal.com]

The Beeb puts the focus on experience too (http://news.bbc.co.uk/1/hi/business/5405064.stm).

I also wonder how this sits alongside performance related pay rises. Quite large disparities can arise when an individual gets consecutive high appraisal ratings. When someone else then comes back from a maternity career break, how is it reconciled?

[andrewducker]

Where I work we have pay grades. Your place on that pay grade is based on how well you're performing relative to what's expected at the median level. In addition, the pay grades go up each year according to inflation/salaries across the industry. Going more than 20% above scale is damn near impossible.

On the other hand, if you've worked well during the year you'll get a bigger bonus - and _that_ I think, is what your reward is for year-on-year good work. If a person comes back from a career break, but is still working at the same level as someone that isn't then they should be on the same percentage - but they'll have missed out on bonuses for the intervening time.

[wordofblake.livejournal.com]

In my old job I was the lowest paid person in the department because everyone else had been there for years. I personally felt like I was at least as competetent as the others, especially since my actual job only predated me by a year.