Should employees have access to company books?

[Magiver]

Using the same logic shouldn’t the players disclose all their endorsement money?

[FasterThanMeerkats]

@Skald_the_Rhymer

I am currently in the process of writing employee evaluations, which will be used to determine what raises my account execs do and do not receive. Should I have access to their income tax records, bank statements, and so forth, so that I can determine which of them is in most and least financial distress, and use that in deciding who to give raises to?

Please explain your answer.

Hey, that’s not fair!! (explanation implicit in whining tone)

[Giles]

@Skald_the_Rhymer

I am currently in the process of writing employee evaluations, which will be used to determine what raises my account execs do and do not receive. Should I have access to their income tax records, bank statements, and so forth, so that I can determine which of them is in most and least financial distress, and use that in deciding who to give raises to?

Please explain your answer.

No: that’s the function of the minimum wage.

So, how do you decide what raises they get? Is it the value they add by the work they do? (Which would be deduced from looking at your company’s books.) Or is it something else? Please explain your answer.

[magellan01]

@acsenray

Stands as what, the word of god? Please. Your statement is an opinion. There are equally valid contrary opinions, and it’s more than a little risible to dismiss them as lemony sparrow porn.

There’s nothing inherently moral about the at will employment system, and there are ways to coerce people into making decisions that aren’t related to physical compulsion. The fact of the matter is that employees, more than employers, are individually subject to economic pressure that plays a coercive factor in accepting terms of employment.

Whether the at will employment system is the most practical or desirable for other policy reasons, it is not a representation of a system that is “most moral” or even “mostly moral.” It is largely amoral. Whether or not that makes it the best policy choice is an issue that must be tempered by balancing various kinds of legal rights, and more often than not, those balances favor employers.

You may disagree with all of this, but if you do it with declarations like “most moral” or “My statement still stands,” you won’t be persuading anyone that you’re right.

I already explained why my position was right. You offered nothing really in the way of a rebuttal until now. It is completely moral because there is no arm twisting. Both parties either choose to strike a deal or not. The economic pressure you mention, I agree, is present for the employee, and he may even feel it much more than what might befall the employer, but that is a situation of his own making. The Employee may feel a particular salary insufficient, or even an insult, and is ready to walk away. But then he realizes that he has a mortgage, a car payment—a situation that he put himself in. Why is that the employers problem? If the employee had a larger cushion he could walk away. But because he decided to take on some debt, he’s reluctant to. All a situation of his own making.

[Acsenray]

Actually, there’s absolutely no reason to assume that the employee has done anything that makes his or her financial situation fault-based. The fact of the matter is that in the employer-employee relationship, employers face less financial coercion than employees. There is no reason to assume that any of it is either fault-based or morality-based.

[Skald_the_Rhymer]

@Giles

No: that’s the function of the minimum wage.

So, how do you decide what raises they get? Is it the value they add by the work they do? (Which would be deduced from looking at your company’s books.) Or is it something else? Please explain your answer.

Well, I’m in corporate, B2B sales. My guys & gals are paid in two ways: salary & commission. If they’re doing well, the salary is much less important than the bonuses. But everybody is assessd based on things like productivity (which is not the same as sales), how much effort they put into the team (or are seen inputting), and a half-dozen other metrics I’m not going to get into.

To be honest, the system is nebulous enough so that an unscrupulous manager could give base salary raises to whoever the fuck he felt like, and deny same to anybody he didn’t. I have a particular manager in mind for that, by the way; he was a team leader when I started my first tour with this company. Over the course of two years he succeeded in populating his group entirely with comely twentysomething young women, each of whom he sexually harassed in one way or another. Those who made waves got punished subtly; those who made no waves got rewarded subtly.

[Damuri_Ajashi]

@Sage_Rat

The goal of the idea seems to be to absolutely minimize profit.

That is in fact what an efficient market does through the pricing mechanism. However recently, companies have been able to put much of the pricing pressure off on labor while preserving returns to capital (and management’s share of those returns to capital).

Perfect information is one of the assumptions of a free market, why would you want to deliberately obfuscate some piece of information and provide the firm an assymetric information advantage?

If every company minimized profit, that would mean that they had no finances to grow. Given that we have a growing population base, that means we would effectively have growing unemployment at the same time.

No it would simply reduce the returns on capital, your scenario only exists if you take that to the extreme. Normally, money will either flee to risk free investments, thereby reducing the return on these investments, which consequently reduces the required return on riskier investments, or rising unemployment will reduce the cost of labor despite perfect information.

Money which is “profit” isn’t, despite what many believe, swooped up and placed into the CEO’s pocket. That’s money which gets earmarked for expansion and rainy days. The more of it, the better for the company.

That is still value going into the shareholder’s pockets.

Yes, the more of it, the less that the current employees are getting, but remember that the corporation is the world’s most successful social security program yet devised.

Noone is proposing communism with ZERO returns going to capital, BTW what do you mean by “the corporation is the world’s most successful social security program yet devised”

Let’s also note that if a business’s profit level shrinks because of wages, but investors still require that the company grow, then the business will need to raise prices on goods. The increased wages will be eaten at a higher rate than before, so that everything equalizes.

I think the popint is that the return to capital is too high.

Notice for example that tax rates in Scandinavia go up to 80% of personal income, and yet the lifestyle there is effectively the same as in the US. An economy is like water. It’s very hard to create a change that actually changes anything.

Then why so much resistance to letting employees see the books of the employer (I’m not saying this is always a good idea but the last few decades have seen incredible improvements in productivity and almost all of the increase in welath generation has gone to capital (investors) and management.

[magellan01]

@acsenray

Actually, there’s absolutely no reason to assume that the employee has done anything that makes his or her financial situation fault-based. The fact of the matter is that in the employer-employee relationship, employers face less financial coercion than employees. There is no reason to assume that any of it is either fault-based or morality-based.

Oh, I agree. There’s no reason to assume that or to even bring it into the equation. But if you do bring it into the equation, the responsibility for the employee being pressured financially resides with him, no?

[Damuri_Ajashi]

@Joey_P

Understanding what a profit margin is. Understanding how much an owner really gets too take home after all is said and done. What kinds of expenses are really involved in running a business etc…

I hear what you are saying. Ignorant employees will see the gross sales figure and think that is your take home.

I don’t think you are giving your stupid employees enough credit. I think even the most retarded mcDonalds employee realizes that the franchizee doesn’t take home $4 for every happy meal they sell but when they see the franchisee taking home $1,000,000/year, they might decide to go to McDonald’s University and eventaully own their own McDonalds some day.

[Brad_the_Impaler]

Isn’t the NFL claiming poverty while part of their deal was after a billion dollars off the top for the owners, they players and owners split the remaining profits by a certain percentage? So, in that specific case, I think seeing the books should have been mandatory. I suppose anywhere there is profit sharing as part of the deal, the books should be able to be opened, within some reason.

But, as a general rule, no.

[furt]

@Giles

So, how do you decide the going rate for a football player? Especially when the employer is a monopoly, and no one else employs football players?

I was under the impression that this thread was addressing the question in a general sense, not about the NFL.

In the NFL’s case, I have zero problem with the players demanding open books, and I hope they get them. The government has granted the NFL an exemption from anti-trust laws, and thus it’s an entirely different situation from 99% of the private businesses in the country.
Personally, I’d prefer there wasn’t a government-enabled football monopoly in the first place, but that’s another topic.

[Damuri_Ajashi]

@Sage_Rat

If you’re worth that much money, someone else would hire you at that amount. Your original person is now down a trained employee and unwilling to keep up with the going market wage so that position is liable to sit empty or go to the worst person.

It’s not a one-sided issue.

Its not one sided but its lopsided. the labor market is a lot more liquid for employers than it is for labor.

[Damuri_Ajashi]

@Joey_P

Honestly, I didn’t think it was going to become an issue to begin with. She told us her new hours at the other place, we told her that wouldn’t work for us and that was it. I was just about knocked out of my chair when I got the UI paperwork from her.
Luckily, even though I didn’t think I would need any proof because I didn’t think there was going to be a problem, I actually had all the proof I should have needed. On her original application she wrote the hours of her 1st job and the hours she would be available to work for us. Then when they changed her hours and she came in to talk to us about it she handed us a piece of paper with her new hours written on it with the hours she’s be able to work for us on it (something that really wouldn’t have done us any good).
When I disputed it and we went before the judge she didn’t lie about anything, so that was never a problem. I thought I had it in the bag. I even had her original application where she wrote down the hours she was available to work (around her current schedule), I brought in old schedules to show what her schedule looked like, I brought in a copy of what she handed me showing her new hours at the other job etc… She confirmed this was all true. She even confirmed to the judge that she couldn’t work for us anymore due to the new schedule at the other place. I walked out of there feeling pretty confident since the judge (and she) agreed that working for us really wasn’t possible given the new situation.

Unemployment insurance must work very differently in Wisconsin than it works anywhere on teh east coast. If you still have a job after losing a job, you are not typically considered unemployed.

[Joey_P]

@YogSosoth

Sure, your father settled for the cheaper car so he didn’t have to deal with stuff, but he could just as easily institute a rule mandating no complaining about the boss’s bling. Hiding things isn’t always the best solution. To 18 year old cashiers maybe, but if your father had a loyal worker who’s been with him for decades and watched the business grow and still is paid the same as he was 10 years ago, then maybe it would have been your father who was wrong. Not saying that’s exactly analogous to the NFL though, just using an example

I think you might be pushing it a bit far talking about someone getting paid the same thing for 10 years. But I’m going to go back to something I said a bit earlier. How about this. If, an employees feel they should get to look at the books when talking about raises, how about, as an employer, I get to look at what you spend your money on when deciding if you need a raise?
If you think an employee deserves a raise just because the company can afford it, then I (the employer) should be able to deny the employee that raise because they don’t need it.

“How come I don’t get a raise, but you can go and buy a new car?”
“How about you move out of your $1200 per month 2 bedroom apartment that you live in by yourself and get a 1 bedroom for $900. Boom, that’s as good as $70 (after taxes) per week raise, right there. Now you don’t need a raise.”
Personally, I think the an employer saying that would be just as wrong as an employee requesting a raise simply because the company can afford it.

[Joey_P]

@Damuri_Ajashi

Unemployment insurance must work very differently in Wisconsin than it works anywhere on teh east coast. If you still have a job after losing a job, you are not typically considered unemployed.

I have no idea how it works where you are, but in Wisconsin you do not need to be unemployed to get it. For example, if I work 40 hours a week and I get cut down to 30, I can collect unemployment for those 10 hours. It’s a bit more complicated then that, but no, you don’t need to be totally out of work to get UI in Wisconsin.

From Wisconsin’s UI Site
“I’m working part time or reduced hours, can I still claim unemployment?”
“Whenever income is reported on a weekly claim certification, all wages earned in that week are added to other types of income (such as holiday pay, vacation pay, and dismissal/severance pay) to determine the gross income for the week. The Department then uses the “partial wage formula” to compute whether partial UI benefits are payable and if so, what amount should be paid. It is possible to receive a partial UI check for a week even when your gross income is greater than your weekly benefit rate (WBR). However, you will not receive benefits if you work a total of 40 or more hours for all employers in a week you are claiming.”

As I said earlier, Wisconsin’s UI rules are very employee friendly.

[YogSothoth]

@Joey_P

I think you might be pushing it a bit far talking about someone getting paid the same thing for 10 years. But I’m going to go back to something I said a bit earlier. How about this. If, an employees feel they should get to look at the books when talking about raises, how about, as an employer, I get to look at what you spend your money on when deciding if you need a raise?
If you think an employee deserves a raise just because the company can afford it, then I (the employer) should be able to deny the employee that raise because they don’t need it.

I think you are misinterpreting what I’m saying

In the case of the NFL, they share revenue, and when one side wants more and is claiming they are not making enough, there needs to be complete transparency to determine if that claim was made honestly or not. Employer and employee matters not in this case, it’s about supporting your claims

In the case of your father, obviously there is no profit sharing between him and his cashiers, but that is because cashiers are a dime a dozen and by themselves have no leverage. Your father doesn’t need that particular cashier like the Patriots need Tom Brady. Cashiers are paid a standard wage for their services that is determined by the thousands of cashiers in that city with neither of you being able to really affect that

You seem to think that I believe all financial decisions such as raises are equal to the NFL’s situation and all employees should be able to look through the books when negotiating raises. I am not making that argument, therefore your hypothetical doesn’t apply to the cashier. They do apply with the NFL though

Recall that my objection to your father’s practice wasn’t simply that he didn’t open up his books, but that he thought hiding it was the best or default possibility. He seemed to do it to avoid confrontation, to avoid having to explain himself, and avoid disgruntled and stupid employees. I’m saying that if he really wanted to avoid that, he should either tell his employees not to complain or not go into that business. I do not think the best solution was to simply hide the facts.

Personally, I’d open it up, I’m not hiding anything and I’m happy to tell someone why I get to drive around in a rich car while they’re making minimum wage. I’m not going to be an ass about it, but I will explain supply and demand

[Joey_P]

@YogSosoth

Recall that my objection to your father’s practice wasn’t simply that he didn’t open up his books, but that he thought hiding it was the best or default possibility. He seemed to do it to avoid confrontation, to avoid having to explain himself, and avoid disgruntled and stupid employees. I’m saying that if he really wanted to avoid that, he should either tell his employees not to complain or not go into that business. I do not think the best solution was to simply hide the facts.

I think it’s one of those things he’s learned works the best. Also don’t forget, how much time do you want to spend explaining why have nice stuff to an employee who might only work for you for 4 months. Sometimes it’s easier to just not let them know you have the jetski to begin with (he doesn’t have a jetski BTW).

Also, part of the problem is, some employees are just plain stupid. I mean, when a 16 year old (think about that for a second, 16 years old, they’re in high school) honestly thinks that the money in the register gets put into my dads pocket for him to take home every night, how much time should we spend explaining to them that it’s not the case…and on whose dime? Should I keep them on the clock while I explain this to them?
I’ve heard 70 year olds say similar things.

I guess it’s a YMMV type thing. My dad has owned this store for 31 years, I’ve been part of it for the last 17 years, his father was in the same business for 50 or 60 years before that, his father before him etc… As a family, we’ve found it easier just to avoid the issue altogether. Personally, I don’t see why it’s a problem. Why bother explaining the bling when you could just not show it to the employees to begin with?

Now, I should mention that I really have no idea whatsoever how NFL salaries work and if this drifts in to union talk, I don’t understand much of that either.
YogSosoth, I’m not sure if you own/run a small business, but I’d be curious about the opinions of anyone else here that does. Maybe my family is going totally against the grain.

[Brad_the_Impaler]

@furt

I was under the impression that this thread was addressing the question in a general sense, not about the NFL.

In the NFL’s case, I have zero problem with the players demanding open books, and I hope they get them. The government has granted the NFL an exemption from anti-trust laws, and thus it’s an entirely different situation from 99% of the private businesses in the country.
Personally, I’d prefer there wasn’t a government-enabled football monopoly in the first place, but that’s another topic.

Actually, the NFL doesn’t have an exemption, it’s MLB that does. That’s the reason the NFLPA decertified, so they could file anti trust lawsuits.

[Fear_Itself]

@magellan01

It’s the most moral position possible. Neither party is forced to do anything in any way. It’s a purely voluntary association.

Do you feel the same way about management negotiating with unions? The owners always have the option of refusing to meet the union’s demands. Entirely voluntary.

[Sage_Rat]

@Damuri_Ajashi

Its not one sided but its lopsided. the labor market is a lot more liquid for employers than it is for labor.

It takes a lot more awareness of fiscal responsibility to become an employer.