On Getting Paid

Showgirls or up-and-coming cabaret artistes are typically paid little per act (back when I performed £50-£150 which may sound like a lot for a 5- minute act but count travel and make-up time, costume cost, rehearsal time and you’ll arrive at a conclusion it’s by far not the most profitable career one could choose). However, those strippers who stand out from the crowd and develop an impeccable personal brand, can sometimes command their wages according to what they feel they are really worth. I have even seen a showgirl’s contract clearly stipulating she refuses to be flown to her performance location by the client with the Ryanair airline. Also, those who choose to do table dances and get really good can typically count on quite a few tokens of gratitude (read: a stack of bills) being slipped behind their suspenders. Also, they can branch out to becoming comperes and hosting entire shows (like I did) or even run their own nights.

At GrantTree people are expected to determine the monetary value of the work they do on a regular basis. Establishing self-set pay in the company has been our ambition ever since Daniel and I read Maverick!: The Success Story Behind the World's Most Unusual Workplace by Ricardo Semler. These days, with roughly forty people in the company, like not many other companies in the world, we also practice full financial transparency which means it’s clear how financial decisions are made, what resources the company has and how they are deployed (essentially everyone can log into our bank account and all financial systems) and exactly who is accountable for exactly what. This is thanks to holacracy which provides a framework making it easy to check what roles given people hold and what responsibilities these roles have assigned to them. More on this later.

In terms of self-set pay, people regularly assess their own performance as part of a self-assessment process. This, as well carrying out an extensive market research, is a requirement one must fulfil to adjust their pay upwards. Nobody has the power to approve or disapprove a pay decision – it’s the person’s responsibility to integrate the substantial information (such as job market data) and the feedback they receive during the decision process, and to come to the best decision they can, rooted in their own sense of integrity and knowing this decision will be visible to everyone else. The decision process has four steps: 

1) gathering information; 

2) making a proposal based on that information; 

3) receiving feedback on that proposal; 

4) making a final decision (which may be different from the proposal). 

The person making the decision about their own pay is in full and sole control of the proposal and the decision steps. They can ignore the feedback received if they choose to.

Needless to say, this is quite a task, which takes maturity and courage. A lot of people, understandably, feel under a lot of pressure when making their pay decisions, which wasn’t there in their past workplaces where the decision was made (and announced to them in secret) by somebody else. Still, they choose to work with us, despite the often significant challenges that this sort of workplace presents.

Some founders I talk to get very excited about self-set pay, some are horrified by it. A lot of people ask how come every second employee doesn’t decide to pay themselves a million pounds. If you make a little effort to put yourself in the shoes of someone making a pay decision in our company, it very quickly becomes obvious why. Firstly, you have access to the company accounts and it’s obvious we don’t have the £1million in liquid cash – or even the monthly equivalent – there required to pay you and to be able to cover other costs that we have. Then, during the multi-step decision process you are required to run, you will need to justify clearly why the job you are doing for the company is indeed worth £1million. This will be challenged from all directions and some people may even feel genuinely concerned what’s going on in your life emotionally speaking, given this is a proposal you are putting forward. You can still implement the proposal, despite all the feedback; the trouble is you are also the one who needs to deal with the consequences.

I’ve also been asked what impact people being encouraged to regularly review their pay has on the bottom line. Is it sustainable for the company? My answer typically is that if it weren’t sustainable, we should be considering changing our business model. I also don’t believe that our wage bill is necessarily higher than those of companies in our sector and of equivalent size. The disparities between higher and lower paid people are simply much less significant. Also, there are no special deals or bonuses given to those who are good at befriending the boss and/or arguing their case.

Does people’s pay ever get adjusted downwards? Not often but it has happened a couple of times when an employee changed their remuneration as a result of a role change in the company, for example migrating to a different department and taking on a role that’s valued lower in the marketplace. The same process needed to be followed to make sure the new, lower pay was a fair one.

All in all, I think we are doing a relatively good job to appreciate the vastness of cultural stories money is tied up with and how it represents entirely different things to different people. For many, the amount of money they earn is a measure of worthiness, also in comparison to peers. For others it’s tied to a sense of security and being able to have the life they want (which seems appropriate on the face value until you realise how many other factors, inner development for example, determine that). For me, up to a point, social status and a sense of worthiness or belonging (I’m a “successful entrepreneur”!) were definitely a factor. These days money is a way to follow my interests, for example by doing all the workshops and retreats that I do, and a way of expressing my beliefs, by investing in startups and projects I believe in.

Considering people have a variety of different needs, conscious and unconscious, around money, there is no possible system which is fair towards everyone. I think this was an important realisation for us and is likely to be one for any company that implements open salary. I personally feel that this remuneration model, because of its nature, is likely to be overall fairer than hidden payroll, which one (or very few) people have an oversight of and decision power over. Generally, the biggest inequalities need to stay hidden to survive as most people would be outraged to see them for what they are. 

This is why, in my view, the gender and socioeconomic pay gap can be eliminated in companies which choose open salary. If the responsibility is distributed and the complexity widely acknowledged, there is more of a chance to implement something which is fairer than the alternatives. Importantly, this is all a consequence of my belief that people are fundamentally good and wired to care about one another. If that’s not what you believe as a founder or a person of influence in your company, you will struggle with what I’m proposing. The pay system is simply a consequence of culture, which is a consequence of lived beliefs.