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Salary Issue

I was wondering what's the general opinion about salary raise. I'm working for a software company in India. We used to get fabulous increments till now. Hoewever this year it has been pathetic.  This is despite the fact that the company has made a better than expected profit.
The management says that the increments are determined by general market conditions and not by profits. However the big shots in the company get a percentage on the profit as part of their compensation. Is this the general trend or is there something fishy going on ?

Curious
Thursday, June 20, 2002

In Israel (at least at my company) it's the same thing, same reasons.... Though we had a better than expected quarter recently, we weren't granted anything either.

Nor were we reimbursed for our 10% across-the-board paycuts that we had to take last October.

Yoav
Thursday, June 20, 2002

Curious,
My management is doing the same thing. They are playing with you(and with me). See the market is bad so you will think many times before you switch if at all you get a good job. Its nothing fishy here just plain business tactics.
When the market is good they will be singing a different tune altogether. Its the trend where everybody is cashing on(I mean the management).

RK
Thursday, June 20, 2002

Standard economics. If the market is bad, you will have less employment opportunities and be willing to keep onto your current job with less incentives.

Just me (Sir to you)
Thursday, June 20, 2002

Yup. Don't ever be fooled into thinking a pay rise is a reward of any kind - it's simply a bribe to stop you from leaving if they believe that to be likely. Once any company realises it's more difficult for you to leave than to stay put even without a raise, they'll skip the raise.

DB
Thursday, June 20, 2002

My employer did the same thing. At the beginning of this year, they announced that (due to poor market conditions) no one would be receiving a bonus or raise this year. Convenient. Of course, they then asked us to work overtime and weekends...

Banana Fred
Thursday, June 20, 2002

"Its nothing fishy here just plain business tactics."

Real business tactics are not fishy... and this is fishy.  It is not a business requirement to treat your people as fools or to consider this "psychology" move related to business.  It is due to the small minds of your management showing the amount of respect they have for you.

Joe AA.
Thursday, June 20, 2002

Amen to Joe.

The only reason to tie raises to current market conditions is to keep money in the coffers during uncertain times in case of an unexpected emergency not related to the core business (such as banks collapsing).  But that's a pretty hollow excuse when one looks at it -- there will always be uncertain market conditions in some part of the market.

If the company's doing well, it can afford raises.

I suspect this is simply a convenient excuse to keep profits in the coffers, and a lack of confidence in upper management that the company is *really* going to weather the times.

Either way, it's a bad sign, in my book.

Brent P. Newhall
Thursday, June 20, 2002

Most of the whacky salary issues seem to be centered around carrot-vs-stick issues decided by people who don't actually know who's doing the work.

Essentially, they figure that it costs $5-10k to find a new person of equivelent experience (remember that HR departments tend to believe in plug-interchangable engineers) and then they figure what everybody else is paying people of equivelent experience.  Sometimes, the costs of getting somebody new up to speed is also counted in.  If it looks like you could get a better job elsewhere and they can't replace you for less, you get a raise.  If it costs less to just hire somebody else if you quit, you don't get a raise.  It breaks it all down to some easy to model equations and eliminates the possibility of some manager giving massive unnecessary raises to their buddy for no real reason.

Remember, these models work just great for other professions, like the corporate auditor in the accounting department who has to approve or deny expense requests.  Sure it doesn't make sense when you consider that engineers are people with individual strengths and 5 programmers on a project is a team with team dynamics.  But it's also the case that bean counters can be counted on to be a boss; many engineers really don't LIKE being the boss, so this isn't likely to change, especially with larger companies.

w.h.
Thursday, June 20, 2002

My company is doing this too.  At first, I was onboard with the idea.  The company was losing money, laying off, etc.  Now, the company is profitable again but they decided not to give raises for a second year.

I think it comes down to this; since technical salaries are dropping, they aren't giving raises.  End of story.

It's crappy but I see both sides.

Them: Look, people with your job make 15% less this year.  I could replace you but instead we'll just keep it like it was.

Me: I'm getting better every year.  I'm a class or two from finishing my master's degree.  I'm not the same employee I was when I got this salary.  It's time for a raise.

Bottom line:  If I find something better (and I'm casually looking) I'll take it.  They'll lose the bargain I've become as I've grown into a tech lead with a worker bee's salary.

private
Thursday, June 20, 2002

private... if you do find something better, take it, give notice and then leave without looking back.

I.E. The absolutely worst thing you can do, is try to use the "new better offer" as a bargaining point to get a raise at your current job.

Joe AA.
Friday, June 21, 2002

Why do you say that Joe? [don't use another offer to lever a raise]

Not saying I disagree, but you assert that with such force I'm curious about your reasoning.

Matt Conrad
Friday, June 21, 2002

Place yourself in the position of "private's" manager.  Even say you, and not private, starts the negotiation and eventually private accepts your increased salary offer and stays.

Now consider:  What do you think of "private"?  What trust do you have in him?  Would you consider him a person of integrity?  What will "private" think you are thinking of, everyday afterwards?  What will you be thinking of when raise time comes around again?

Joe AA.
Friday, June 21, 2002

Joe is naive.  What are my requirements as an employer?  To maximize shareholder value.  Thats it.  Don't give me any peopleware crap about happy programmers.  There's too many good programmers out there that are just happy to have a job, and their work reflects it.  I've seen too many programmers that were treated like KINGS leave after a couple of years just for a change of scenery.  Don't feel so bad, it hurts my job too.  It seems that only the ceo is immune.

striving for ceo
Friday, June 21, 2002

Of course I am naive - simple in nature.  I don't create a bunch of artificial complexities, nor do I tolerate them.

Peopleware crap?  Happy programmers?  Never would I recommend to anyone to treat any employee as a "king".  Only a fool would do so, as the fool ain't receiving fair value.

If you believe your "only" job is to maximize shareholder value, then you ain't gonna make CEO.  There's another word you should learn... it's called "customer".  If they don't support you first, the shareholders damn sure won't. 

Joe AA.
Friday, June 21, 2002

I've always questioned the advice against accepting a counter offer.  Head hunters give out that advice but of course they have a vested interest in getting you to leave.

I suspect my manager would be happy to have me around if I accpeted a counter-offer.  However, my company never gives them out.

private
Friday, June 21, 2002

private, just because someone may have a vested interest, as in your headhunter example, doesn't mean the advice is bad.  No vested interest doesn't mean the advice is good.

Most managers/companies worth their salt won't provide, much less entertain the issue of, a counter offer for a current employee.  It is not really in their best interest.

Good luck with your choice.

Joe AA.
Saturday, June 22, 2002

Regarding the counteroffer of a current employer scenario.  I've thought about this before and came to the conclusion that if they needed me they'd make a counter offer and then start looking for my replacement.  With that in mind I've never considered a counter offer.  If I wasn't worth it to them before then how can I suddenly be worth so much more?

Greg Kellerman
Saturday, June 22, 2002

{
If I wasn't worth it to them before then how can I suddenly be worth so much more?
}

That's an illogical conclusion.  You WERE worth it to them before, they just needed a little kick in the ass to realize it.  You're forcing them to react, and the counter offer is proof they think you're worth it.  Yeah its a shame they were reactive instead of proactive, but thats the way it is.

Here's a parallel:  After dating my girlfriend for many years she gave me the dreaded ultimatum:  "We've been together a long time, my biological clock is ticking, yada yada.  Either we talk about marriage or I have to move on."  I committed.  That doesn't mean that she suddenly became marriable after all these years, she just gave me the kick in the ass I needed to realize how good I had it.

RJS
Sunday, June 23, 2002

If I said to a lady friend that I was scoping out some Other Girl, and will go to her if we don't marry...  I think I might wake up one day with parts missing.

If you're a really good worker who gives a great deal to the company, and you make it clear you're leaving, you might be lucky enough to have a manager who just won't let you leave.  This happened to GE's Jack Welch, and it probably happens to others in the real world too. 

Just make it clear that you're fed up.  Not that you're going elsewhere for more pay, but just that this company is doing you wrong.  I did something similar, and it appealed to their sense of needing to be competent at their life's work.

Sammy
Monday, June 24, 2002

Oh yeah, this assumes that you're complaining about salary because the rest of work sucks, or you're grossly underpaid.  Simply not getting the raises you got before... that's a fuzzy subject, and I don't know the situation enough to say what's fair.

Sammy
Monday, June 24, 2002

You mean that people aren't just entitled to a raise for just showing up at work over the last year?  That doesn't seem fair!!! (this is a joke BTW)

Joe AA.
Monday, June 24, 2002

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