Common concerns

What are our top concerns as an organization regarding pay equity?

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Pay equity playbook⁠

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Common concerns about pay equity

Common concerns about pay equity

Common Concerns

Response

We’re too small of an organization

Now is the cheapest time to fix any problems you find. Additionally for high-growth tech organizations, mistakes you make now on stock-based compensation will be magnified dramatically as you get larger. E.g., a delta of 10,000 ISOs at $0.01 strike price doesn’t sound like much today, but it will be massive as you grow and approach IPO.

We don’t have the resources or team to do this work

Most software companies spend 80%+ of their cash on employee salaries. This totals millions of dollars in annual spend, even for A round startups. A robust compensation plan provided by compensation consultants should only cost $20-50K for smaller organizations on an annual basis. This is less than one-third of the cost of a fully loaded software engineer. It’s relatively cheap, you can find a great consultant, and it’s worth it.

Fixing any mistakes will be expensive

Employees will (or will soon) figure out that they aren’t fairly paid. And they will attrite. And they will tell their friends why they left. And the damage to your employer brand and attrition of employees will ultimately be more expensive. Also, not fixing mistakes opens you up to regulatory violations and potential lawsuits.

It’s too time consuming

Market-based pay is much more efficient than onerous pay-for-performance models. You can redirect that time savings to having development-oriented conversations across your team and to achieving your business goals.

There are no rows in this table

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