Turnover: Longevity, Tenure and Compensation

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I thought you might want to know how your company pulls together a job offer for you. Specifically, how they determine your salary.

Whether there’s a formal HR department or not, and whether this is a conscious or unconscious effort, we consider a few things. We look at the market — both the real market and the market we assume to be true because we think we know stuff about wages. Then we look at what the previous guy earned. Of course we ask what you used to earn and how much money you expect to make.

It’s very scientific, obviously. Don’t question us. We mix it all up together — and in the process we overestimate the value of our soft benefits such as a flexible work environment and our awesome PTO plan that you’ll never fully realize — and then we do the unthinkable. We have an internal discussion and ask ourselves whether or not you will work here for a couple of years.

That’s right. Turnover still matters to HR.

Even though some people believe that the average Gen Y worker changes jobs an average of 29 times and the average time in one job is 1.1 years — and even though HR has been laying people off for years — we still hope for long-term compatibility and an extended tenure. We say stupid shit like, “It’s expensive to replace someone.”

Never mind that labor is part of the cost of doing business. Let’s ignore the fact that capitalism can’t succeed without employees who do the actual work. Let’s ignore studies that show a healthy amount of turnover can benefit your company’s innovation agenda.

HR loves longevity. For some reason that has nothing to do with math, we like employees to stay in their jobs for at least two years. It makes life easier for everyone. And maybe — just maybe — we like to plan service award parties.

Now listen, if you’re an employee, you should know that you have some rights. When crafting your salary expectations, you should account for something called ‘the bullshit differential.’

Think about your hourly rate and how much nonsense you’ll have to put up with on a daily basis. Does this company seem to hassle its employees? Is there a ton of email? Do people like to have meetings where everyone goes BLAH BLAH BLAH and nobody can focus? Will you be asked to work in an environment where people seem to participate in an endless loop of narcissism and nonsense? Do people watch your time? Are there employees who are territorial? Is there a bully in the office? 

Much like union workers will factor in a shift differential to work at night or on the weekends, you can subconsciously create a bullshit differential. How much extra money will it take for you to work in a company for more than two years and put up with all that hassle?

You are more powerful than you think. Don’t enter salary negotiations without realizing how HR calculates your pay, and don’t accept an offer for a job that will suck up your time and energy for the next 24 months without fully calculating the bullshit differential.

You owe this to yourself.

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