[newsbinator]

Yes, and it should also be tied to their spouse's income, their sex, gender, age, and skin color, to keep things fair. Perhaps their sibling's/ancestor's income too. Make sure you account for all these factors to keep things equal.

But if you're not able to account for all these factors, why not determine what an employee at a given level is worth to the company, and pay that amount to anybody who can successfully communicate & do the work, regardless of their circumstances or physical attributes?

[bboygravity]

> But if you're not able to account for all these factors, why not determine what an employee at a given level is worth to the company, and pay that amount to anybody who can successfully communicate & do the work, regardless of their circumstances or physical attributes?

Sounds good to me. I'd be a retired millionaire at age 30 something if any of the companies I've worked for (remotely or otherwise) followed that logic.

Example: I found the correct root causes of failures in an aerospace product within months. The company's own R&D team had been trying different "fixes" that weren't fixes for at least 5 years. They had spent 1 million EUR in R&D material cost alone (not counting engineering time cost). They lost multiple clients to competitors (> 15 years contracts worth millions per client) due to the malfunctioning product. After I came through the problem was fixed, tested, confirmed to be fixed and implemented within months.

And that's an example of one project of a few months for one of my clients.

hmmm. Maybe I should start charging differently. :D

[vsareto]

Sadly, companies basically have no obligation to pay out for this kind of contribution since you basically gave it to them for free. You're kinda working for 'exposure bucks' in this regard.

If you somehow save the company (provably), do you get to own the company? Likely not, although most of the lower employees probably would vote for that if it meant they kept their job vs. the company dissolving.

But companies can do this too: "If we hire you and you make a simple mistake and leak our database or something, do we get to charge you millions in potential damages?" At some point it goes to a court.

Maybe you just have to get adversarial and say "I can save you tens of millions and you should give me a million dollar bonus if it works, but if the bonus is not in writing, I won't give it to you".

[bradstewart]

> I'd be a retired millionaire at age 30 something

How do you know what value the companies would assign to those factors?

[bboygravity]

They assign to those factors whatever you can convince them of as an employee/contractor during your interview :)

In case you're fixing an existing problem, the cost of the problem is often roughly known (like in my example). Lost clients due to the specific bug, current clients threatening to leave, sunken/running R&D costs without a solution, missed sales/tenders where clients mentioned the bug as a reason, long term damage to the brand, etc. You might be able to roughly extrapolate that into the future.

In case you're working on a new product or general improvement it can be impossible to measure how much your contribution was worth.

Hence, employees/contractors are usually valued by the hour or by the amount of equity they own and not actually by their value to the company.

In some industries it is possible to be valued exactly by the value you saved. A common example that comes to mind: a lawyer who does pro bono work.

Another example in engineering: filing warranty claims for failing (very expensive) products. You could negotiate to get a percentage of every successful claim. I've heard of people making millions that way in aerospace. Apparently companies in aerospace for whatever reason often don't claim warranty when they're entitled too. Keep in mind that large companies in some industries really really don't care about a couple of deci-millions here and there because their turnover is in the billions and they have "better things to do" :D

[elbear]

"> 15 years contracts worth millions per client" would be a start.

[s1t5]

> determine what an employee at a given level is worth to the company

Nobody does this. It's not even possible apart from the most contrived cases. Salary is determined by a number of factors none of which have anything to do with the employee's worth to the company.

[kyriakos]

I agree that it's not happening but this is how it should be happening.

[BeetleB]

I believe that s1t5 is trying to say no one does it because it is very hard to do.

Especially in a bigger company, where the work you do is tied to so many others' work in the company (sales, etc) - how do you expect them to figure out what the value of the work you did is, vs your teammates, let alone vs all the non-SW folks involved?

Example: You could have done a great job, but someone further down the pipeline screwed things up and the product never got released, and your code is never reused. This is a case where your work produced no value to the company (through no fault of your own). Should you get paid $0?

[mandelbrotwurst]

> "none of which have anything to do with"

This is hyperbole, right?

[BeetleB]

Not by much. Salary is mostly decided by supply and demand. These are tied to your worth to the company, but very loosely.

[happytoexplain]

Fully half of your post is a sarcastic rant.

>why not determine what an employee at a given level is worth to the company, and pay that amount to anybody

Because the same salary may be worth the same amount to the company paying it, but it is not worth the same amount to different people receiving it. Among two equally valuable people, one may accept and one may decline due to salary's differing value to them based on environmental factors. This is obvious to businesses, and is generally accounted for (fairly or unfairly).