Let's Talk About Pay

"Am I getting paid enough?" is a really hard question to answer. And, as a woman, I'm constantly wondering if I'm somehow unknowingly a part of the wage gap. Websites like Glassdoor don't offer specific-enough data, and it can be difficult to ask your colleagues about their salaries because it's a cultural taboo. This blog aims to help make it easier for all of us to figure out when and if we're getting paid a fair wage by promoting the idea of salary transparency and encouraging individuals to talk to each other about salary. - - - Do you have advice on asking for a raise, negotiating salary, or talking with colleagues about salary? Do you have a story that you'd like to share? or did you read an interesting article about salary transparency? Contribute to the conversation!

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Freelance Designer Rates: Interactive Data Chart from Hello Bonsai

A friend just sent me this interactive data chart that allows you to see how much most freelancer make / charge  for design work. They have nice filtering options for things like US West Coast vs US East Coast, number of years of experience, and skill title.

Niiiiiice.

You can play with the chart yourself here.

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S.E.C. Approves Rule on C.E.O. Pay Ratio

Requiring companies to compare the chief executive’s compensation with that of employees could further stoke a debate over income inequality.

After a long delay and plenty of resistance from corporations, the Securities and Exchange Commission approved in a 3-to-2 vote on Wednesday a rule that would require most public companies to regularly reveal the ratio of the chief executive’s pay to that of employees.

Representatives of corporations were quick to assail the new rule, which will start to take effect in 2017, saying that it was misleading, costly to put into practice and intended to shame companies into paying executives less.    

But the ratio, cropping up every year in audited financial statements, could stoke and perhaps even inform a debate over income inequality that has intensified in recent years as the wages of top earners have grown far more quickly than anyone else’s.

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Here’s why our team now chooses their own salaries - The Logbook by Hanno

We think we've found an even better way to tackle the problem of calculating team salaries: the whole team will choose their own!

Pretty effing genius, and awesome.

If you’re all TL;DR, the reasoning behind how this works without people abusing the system is as follows:

Sure, if you tried to drop this system into a faceless big corporation, where people don’t feel strong ties to the company, you’re going to have issues. But you have to keep in mind that at Hanno, there’s a strong sense of loyalty to the team, a lot of peer pressure, and everybody knows how much everybody else is earning. Here’s where the nuance comes into play and stops the whole thing turning into a free-for-all cash grab:

“Cynics thought a few [people] might take advantage and award themselves undeserved or even outlandish sums, but that didn’t happen. I like to think that it is because everyone at Semco is reasonable and honest. Maybe, but I’m sure that transparency had a lot to do with it – public salaries are a strong disincentive to be conspicuously greedy.” – Ricardo Semler, Maverick

When you work with a bunch of people you respect, you don’t walk into the party and eat the whole cake before anyone else can have a slice. Plus, when the rest of your team has the ability to dictate who is being hired and fired, and can shape the budget within the company, you have a far stronger incentive to be decent and reasonable about the way you approach the decision as to what you’ll be paid. As Semler explained in Maverick:

“There are three reasons why reasonableness prevailed. First, everyone knew what everyone else was paid. Second, the top people are all modest about their pay. The third reason our people tended to be modest about salaries has to do with self-preservation… Our people know salaries account for most of our operating costs, and they think about our six-month budgets when they set them. It’s easy to solve a budget problem by eliminating a salary that seems too high, and no-one wants to stick out.”

Can’t wait to hear more about how this works our for the team at Hanno! 

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What Happens When You Talk About Salaries at Google

Former Google employee Erica Joy gave a tweet-by-tweet replay of exactly what happened when she tried.

TL;DR: A Google employee started a spreadsheet for fellow employees to spread salaries. There was definitely some unfairness happening. Google managers weren’t happy, and they retaliated by refusing to give Google employees pay bonuses.

It’s so exciting to see employees take pay transparency into their own hands. I hope it sets off a string of similar guerilla spreadsheets. :)

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The Unexpected Benefit of Telling People What Their Coworkers Make

Advocates for pay disclosure typically focus on the advantage it gives to women in negotiating for equal pay. But new research suggests that companies might be the real winners.

TL;DR: Pay transparency has the potential to increase people’s productivity.

Why did pay disclosure increase productivity? We’re not sure, but the answer may be that people care about their position relative to their coworkers. We may work harder even if we don’t see a raise if we know that we’re doing well compared to our peers. Workers may care about the level of their earnings not only because it lets them buy goods and services, but because it also lets them know where they stand in their peer groups, giving them an internalized sense of status.  Normally a productivity jump of the size I found would be significant for any business, not to mention, hard to come by. But these gains were made simply by giving workers information, yielding greater firm output without increases in wages, and, thus, potentially greater tax revenue without increases in tax rates. This is one potential advantage to pay transparency, quite different than the rationale that pay transparency is a plus because it can reduce the pay gap between male and female workers.

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My Struggle With the Last Great Taboo: Admitting My Salary | WIRED

Using the hashtag #talkpay, people are tweeting about how much money they make—a radical thing to do in a culture that treats disclosing your salary as the ultimate taboo.

A brief introduction of the #talkpay Twitter hashtag:

Late last week, using the hashtag #talkpay, people began tweeting about how much money they make—a radical thing to do in a culture that treats disclosing your salary as the ultimate taboo. The movement was dreamed up by Lauren Voswinkel, a software designer, and was born out of the ongoing conversation about gender discrimination and inequality in the tech sector, and across the board in terms of pay in the US. How can we make sure men and women are paid equally for equal work? Well, one simple way to at least start is to make it clear what everyone makes. 

On the importance of advocating for yourself:

By the time we hit 30 [my friend Emily] was making so much more money than me it was nauseating, but she’d started her career exactly as I had, working her way up from intern to manager, learning on the job (we’d both attended the same liberal arts university where practical skills were not the focus), and switching jobs every few years. The difference was she had the guts to advocate for herself every single time anyone told her what she was worth. She would stop and say, actually, here are the reasons I am worth more. And she’s right. Every time I have an annual review or a meeting about expanding my role at work, I aim to be her. I think of my friend and it gives me strength.

On how scary it is to disclose how much you make:

Hopefully we also derive meaning and satisfaction from our work, but we’re kidding ourselves if we pretend that work does not exist primarily to put money in our pockets in order for us to live lives. To support our families. And therefore, salary information should be considered the most vital, the most important aspect of a job. By sharing that basic data, we empower everyone. And yet when I look deep into my heart and ask why I haven’t yet just typed my current salary here I must admit that it’s because the powers of taboo are strong in me, too. I think back to that man in my old job; I think of my current colleagues. One tweet could change the way we all feel about each other. And that’s what’s so terrifying about it.

Overall I would say this perfectly sums up the response I get from friends and colleagues when I ask them how they feel about salary transparency. Logically they see no reason why we shouldn’t all just be open about how much we make, on an individual level. But when it comes to actually doing it: Almost everyone is uneasy and hesitates to put their number out there.

This is a deeply ingrained cultural taboo, and it’s going to take time for us to overcome it. 

I, for one, pledge to be completely transparent. Just ask me, and I’ll tell you. 

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What to say when an interviewer asks, ‘How much money do you want to make in your next job?’

Full article from Business Insider here.

TL;DR, I thought the most important points were:

1. Offer a range, not a specific number. 

“This gives you wiggle room and allows you to reach for the highest number”

2. Share your research. 

“This allows you to speak in more objective terms: ‘My research has shown that this kind of position with my experience is in the range of X.’”

3. Think in terms of overall compensation. 

“Before you get into specifics, know the entire compensation picture.” Consider if there’s a 401k, vacation time, benefits, etc.

4. Back up your requests with reason.

“Don't make an unreasonable salary request. But if you quickly back up an aggressive request with understandable circumstances that have kept your salary below market level, you'll get better support.”

5. Don't cave too early. 

Never throw out a number and then immediately say, "Well, maybe I'm not worth that much," just because the hiring manager looks surprised.

6. If the initial offer is a little low, but you really want the job, negotiate a salary review in 3 or 6 months.

"If you get this in writing and exceed expectations, you may well be at your target salary by year-end."

7. If you really don't know or don't care, evade the question. 

Normally this would be terrible job interview advice. But, if you really don't know or don't care about salary — or you're too uncomfortable answering the question — try something like: "Salary is not my primary criteria. I really place a lot of importance on seeking a challenging, supportive environment where I can make a significant contribution and grow."

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Asking for a Raise: Advice from Helen Hou-Sandí

Helen Hou-Sandí is Director of Platform Experience at 10up and a Lead Developer of Wordpress. You can find her on Twitter at @helenhousandi.

I asked Helen about her experience asking for raises, as well as what advice she would give to women in the tech industry who are looking to ask for a raise.

I think the advice of “the worst that can happen is a no” is sound advice here, even if it feels overused and almost trite. Sure, you could find yourself on the outs if you approach it as entitlement without grounds and/or attack anybody, but that’s essentially unrelated to the ask itself so much as a negative trait that probably presents itself in other areas as it is. I requested a VERY significant raise once and got it without much back-and-forth - it made me realize that my nervousness was mostly unwarranted and that I was still undervaluing myself, but at the same time, I am glad that I put the prep work into justification and doing the work that earns that kind of pay, because that’s the respect my company and team deserves. I think that compensation should be related to the work you are already doing, not the work you think you should be doing, if that makes sense. But it shouldn’t lag very far behind, either. At [my current company], our executive team includes compensation conversation as a part of every review - it helps even out the field for those who are less vocal, and realistically, in a competitive market, if your employer isn’t proactive about these things then they are probably going to lose out.

Helen brings up a great point about justifying your request for a raise. The best way to ask for a raise (and really for almost anything), is to have ample evidence to back up your request – a request that is essentially saying “I am worth X.” The obvious question is “Why are you worth X?” 

So, how do you ask for a raise?

Create a list of all of your major accomplishments and contributions to the company. 

Focus on things that you did that were above and beyond.

Include testimonials or quotes from your colleagues and/or clients about the great work you’ve done.

If part of the reason you’re asking for a wage is because you feel your wage is below market rate, politely include this as a reason.

Use positive, instead of negative, language. e.g. Rather than focusing on the idea of “I’m not getting paid enough”, frame it as “I believe that I add value to this company in a meaningful way.” 

Remind the company that you enjoy working there and care about the work that you do. (If this isn’t true, then maybe a raise won’t solve your problems, like Helen mentioned.)

Questions? Comments?

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To fight income inequality, tell your friends how much you make

Meredith Bennett-Smith’s article on Quartz yesterday is so on point right now. She shares her own personal experience of being severely underpaid, but not knowing enough to ask for more. Some great takeaway points from her article are as follows:

If you are underpaid at your first job, you will likely continue to be underpaid for the rest of your career.

“One thing we see a lot is that pay is set in your last company,” Joelle Emerson, leader of a strategy firm that works with tech companies to promote diversity, recently told Fast Company. “If you were being treated unfairly at your last company, that’s just going to follow you throughout your career.”

Reddit’s move to end negotiations doesn’t really help us address income inequality (see also my rant on this exact issue from a few days ago):

Over at Reddit, interim CEO Ellen Pao thinks she has a solution for gender-based wage discrimination. [...] It’s a bold move, and Pao’s strategy may help the company’s weakest negotiators, but it won’t address the fates of employees who have been “systematically underpaid.”

The best way for us as women (and anyone else really), individuals, and employees to fight this is to TALK TO EACH OTHER. 

Yes yes yes. Thank you Meredith Bennett-Smith!!

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Q: How much should I charge for my work?

There’s no wrong rate the first time; pick a number out of thin air. (Hint: that’s how everyone does it.) I’ll start you off. Most professional designers and developers that have a few years under their belts charge somewhere between $70/hour–$120/hour. 

Dan Mall published this awesome article that details how you can figure out how much to charge as a freelance designer. Note that these are hourly rates. You can use this Salary Converter to figure out what a rough equivalent would be in annual salary. 

P.S. This article is part of Medium’s series, “Dear Design Student” which is a great collection of advice from professional designers.

[annelibby]

Dear Rachel,

The salary converter is a good start, and #itscomplicated.

1. As a freelancer, you’re taxed at a different rate. 2. When you’re finding your next client (aka “selling”), you’re not paid, and you don’t receive unemployment insurance. Expect to be unpaid for more than just vacation time. 3. You buy your own laptop, pay for your work phone. And so forth. 4. Your health insurance (in NY) has no out of network options, so you’ll likely pay more out of pocket for your health care… 5. There’s no equity, no 401k match. (Talk to a financial advisor about different retirement savings vehicles, though.)

Also, give yourself a raise every year. If you have long-term clients, they’ll understand an annual increase tied to a cost of living index. Easier for your to sell to her boss than it is to wait 5 years and try to raise your rates accordingly.

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Word. Great points annelibby!

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YES. 

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We pay designers on the same scale as we pay engineers. A good junior designer will make around 80-120k with us, depending on their experience and skills. A really senior designer that I can trust completely is worth around 150k to 200k.

Jonathan Wegener, Co-Founder and CEO of Timehop

Hear that designers? Thanks so much for your transparency Jonathan! :)

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Q: How much should I charge for my work?

There’s no wrong rate the first time; pick a number out of thin air. (Hint: that’s how everyone does it.) I’ll start you off. Most professional designers and developers that have a few years under their belts charge somewhere between $70/hour–$120/hour. 

Dan Mall published this awesome article that details how you can figure out how much to charge as a freelance designer. Note that these are hourly rates. You can use this Salary Converter to figure out what a rough equivalent would be in annual salary. 

P.S. This article is part of Medium’s series, “Dear Design Student” which is a great collection of advice from professional designers.

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Thoughts on Reddit’s Elimination of Salary Negotiations

There have been lots of articles about this, but the one I like most is the Salon article, which you can read here.

THOUGHT #1: ELIMINATING NEGOTIATIONS DOESN’T ACTUALLY SOLVE THE WAGE GAP. 

Pao’s move to eliminate salary negotiations doesn’t directly address the root of the issue. Eliminating negotiations still leaves room for the company to pay their employees unfairly, below the market rate, or even to engage in gender discrimination.

Yes, you read that correctly.

Simply telling employees that the first offer they got is the only offer they’ll get DOESN’T help if the offer is unfair to begin with.

And what does it mean that salary negotiations are eliminated? Does that mean that employees can no longer ask for a raise either? Because that to me just sounds like all employees would be at the mercy of their employer, never able to advocate for themselves if they think they are being underpaid.

The real solution would be salary transparency. If, as a company, you believe you are paying people fairly, then there is no shame in making salaries public. If someone disagrees, then, fine, it’s time for a conversation. But at least that transparency helps people to determine if they’re being paid fairly to begin with. Salary transparency automatically means that any gender disparity can be addressed immediately if it ever occurs. 

If you simply eliminate negotiations, all you’ve done is take away employees’ right to advocate for themselves, without empowering them to know when inequality is afoot.

And in the long run, I actually think that eliminating the employee’s right to advocate for themself AND continuing to keep salaries hidden from all employees only increases the potential for companies to abuse and underpay their people. 

To be fair: I’m sure Ellen Pao, as Reddit’s interim CEO, is working hard to ensure that all of Reddit’s female and male employees are paid fairly with no gender discrimination. This is not a critique of Reddit per se, simply their tactic of eliminating salary negotiations.

I’m glad that Ellen Pao is able to draw so much media attention to this issue, but I implore everyone who is and does support gender equality to think deeply about how we can actually solve the wage gap, and not just put a bandage on it.

THOUGHT #2: LET’S BE THOUGHTFUL ABOUT THE LANGUAGE WE USE TO TALK ABOUT GENDER INEQUALITY. 

The reason I like the Salon article (slightly more so than this Mic article) is that the Salon article explicitly frames the issue like this:

Pao is right about disparities in outcome when men and women negotiate. According to a 2006 study, researchers found that women who negotiate often pay a price. The study found the “negative effect” of negotiation — a decline in the evaluator’s willingness to work with the person who negotiated — was 5.5 times greater for women than it was for men.

This frames the issue as a problem of our culture – the problem is that women are treated differently even when they act the same way as men. 

On the other hand, I think the Mic article could be a little more careful with their language:

A 2007 study in the Journal of Personality and Social Psychology found that women were less likely to negotiate salaries. For historical reasons relating to power, politeness and language, the study argued that, "framing situations as opportunities for negotiation is particularly intimidating to women."

Even though the first part of the sentence (“for historical reasons”) is the key, the final point of the sentence feels like it’s saying that women are more intimidated of negotiating than men are, just by virtue of the fact that they are women. I doubt the writer meant to intimate this, but I think the phrasing leaves room for people to think that this is somehow just the way women are.

Which, obviously, it is not.

I think it’s very important for us to be explicit when writing about issues of gender equality about the root of the inequality. Women are raised in a culture that teaches us to NOT explicitly ask for what we need and want. We’ve been told since we were children that it isn’t nice for us not to be “ladylike.”

So this is how I would rephrase it: It’s NOT that negotiating is “particularly intimidating to women.” It’s that women have been PENALIZED their whole lives for being up front about what they want and need. We have been criticized for being too blunt, too straightforward, too aggressive, too bitchy... really anything that isn’t considered “ladylike.”

Let’s be clear: I don’t give a shit about being ladylike, and neither should any other woman.

The problem is our culture and with gender stereotypes. Women wouldn’t have to be intimidated of negotiating if they were treated with the same respect as men are. And women wouldn’t have to feel like they should tone themselves down if the world wouldn’t stop threatening us for not acting or behaving according to gender norms.

The language that we use is important, because it shapes how we all think of the issue – even subtly and in ways that we don’t suspect. 

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LIVE CHAT THIS SATURDAY @ 4PM EST

THIS SATURDAY – April 11, 2015 – I'm hosting an online chat for Product/Interaction/UX designers to talk about pay! 

The Rules:

Anonymity is optional: You’ll have the option to use a pseudonym, your real name, or connect your Twitter. (I’ll point out that connecting your Twitter makes you more real though!)

What We’ll Talk About:

Asking for raises

Negotiating salary / benefits

Offers we’ve received

And, of course, salary!

How to join: Go here!

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Help me by filling out this survey :)

So I’ve been talking to a lot of designers and non-designers in the tech industry, and I’ve heard a lot of stories. I’ve also gotten a lot of great input and ideas about what else can be done around this issue.

Based on many of the conversations I’ve had over the last couple of weeks, I’ve realized that I actually need a lot more information. 

So, here’s the first thing you can do to help: Take this survey!

Filling out the survey will help me figure out things like:

How do people feel about salary transparency?

How often do people feel that they are underpaid?

How comfortable / uncomfortable do people feel about having conversations about salary?

Thanks in advance for all your help! And please share this with anyone you think this will matter to. :)