TL;DR: We now have self-proposed salaries.

Some time ago, Sofia Reis wrote A Story About Salaries At Mindera.

If you haven’t read that one, please read it — for context — before reading this one.

What’s going on now?

Warning: this is a looong post, as I give context to explain the thought process which took us to our current process.

Looking for a TL;DR? We now have self-proposed salaries.

If you want the whole journey, strap on to your seat… you are in for a ride!

Salary transparency

More than two years ago, we started the salary transparency group. Basically, it started with 20 people, more or less, who after several meetings were comfortable with the idea, thought transparency had value in itself and didn’t look at salaries as a taboo.

Example of what could be 3 entries of the salary transparency sheet (only the gross salary is manually inserted by those joining, the rest is auto-filled)

The group grew steadily and it has stabilised at around 70 people.

Even though this wasn’t very publicly announced, just a bit on Sofia Reis’ post, it generated a lot of curiosity from people… especially outside Mindera. A lot of friends of mine kept on asking how it was going — most of them sceptical and wondering when would it start to go very wrong.

Let’s start with this: Mindera did not implode… People did not start a fight… the world did not end.

All people who joined are now more aware of the broad salary for each role, as well as their position on the salary band of the role. Some agreed with it, others didn’t.

Now the overall sensation of those who joined is that it’s positive to have more information. It didn’t end the tabu of this subject since not all people feel comfortable joining, but at least the topic is a little less sensitive.

Was this really useful? Or was it just an increase in information and transparency?

This information could be, and was accepted as, fair use when asking for a raise — if someone felt they were being underpaid, having taken into consideration now the visible salaries and the market value.

So, are you telling me this is all coming up roses…?

No. When someone joined, the agreement was that the information was to be kept within that group. In a few cases unfortunately that did not happen.

It was a known risk for those who joined but most of the people assumed good faith. When ‘a leak’ happened it generated a discussion on why people would break trust (and why they shouldn’t).

One person left the group due to that. But the effect had bigger ripples outside the group, as some people didn’t join expressing concerns over this.

Just to be clear, this wasn’t a short term ‘experience’. This is ongoing and seems to have reached a stable point (of growth and comfort).

If something relevant happens in the future we might share more about this and how it works. As this post is really big I won’t focus much on it, if you are reading this and you are interested please leave a comment and we’ll post more information about it.

What followed?

Credit: Evan Jackson

Self-proposed salaries. However, before going into this let me provide context for it…

Why are we doing all this?

Every option we make is guided by the principles that built Mindera: trust and self-organisation.

“We use technology to build products we are proud of, with people we love.”

We are trying to reach a process that makes sense, especially if you look at it from those two building blocks. We wanted to point to a method where each person would be more involved in their own fate.

Also, we don’t have performance reviews, ‘grades’, ‘metrics’… it doesn’t fit in our culture.

Yes… we don’t have performance reviews…

One of the things that is mentioned in some of our posts (and that is quite hard to grasp) is feedback over evaluation.

Why do we have feedback over evaluation? Are those really different?

I think, all of us want to improve. Be a better person, both in a personal sense and in a work sense. We thrive with different things but we all have one thing in common:

To be able to improve, we must be self-aware.

Self-awareness is the basis of improvement, whatever the goal is.

Our culture focuses a lot on self-awareness and we clearly ‘put our money where our mouth is’ by not having performance reviews but feedback instead. Those seem the same thing but the starting point is very different: In performance reviews:

Someone (hierarchically above) defines objectives.
After a period of time, those are checked – the more you approach them, the better review you’ll get.

Feedback on the other hand:

• Has no pre-determined goals to attain.
• You define your own goals.
  

You ask the people around you to (or they autonomously) provide feedback about yourself to increase your self-awareness.

They do not need to be aware of your personal goals, they just give you an ‘outside’ view that you can then compare with your own.

It’s not about who’s right, it’s about having a different perspective. Life is not black and white.

I look at it as an invaluable tool to grow. It’s a bit like the different answers you’ll receive if you ask the questions:

What have I done wrong?

vs

What could I’ve done differently?

The second one does not mean that you did something the wrong way, just that there are other ways to do it.

So, how can feedback and awareness help us with salaries?

If you are indeed focused on improving and gathering feedback then you start by collecting several perspectives, so you can create a sense of what your salary should be.

I said sense, as fairness is a tough concept. What is fair? Is 1000€ fair? What about 2000€? Why?

Normally, we tend to find a value fair or not through comparison. If Bob earns more than I do and I have more skills then that’s not fair. We compare not just with people within our company but also outside. Then we kind of have a ‘feeling’ of what’s fair or not.

Not so often we may think “what have I grown in the last three months? Or in the last year?”

Salaries tend to be a payment for the work we do, due to the skills and traits we have.

So, salaries?

Remember that what you bring to the table are not just skills, you bring your whole self!

With your good or bad mood, funny or serious personality, always providing support for those who need it. Or just sitting still doing an awesome job.

What if you had to propose your own salary and provide reasons for it?

Have you ever thought about that?

I guess you start to wonder more about your own skills and traits.

That tends to help to search for a high sense of self-awareness. If corroborated by feedback around you, you can elaborate on a very interesting proposal.

If you join that with a vision of what is the ‘value’ of your skills in the market, you can probably provide a fair salary proposition.

So you self propose salaries? How does that actually work?

One of the things that makes Mindera different is our endless search for different and better (we hope) ways to do things.

This was not different, several people proposed ways of having a self-proposed salary system within the company (via Slack initially) and later on in meetings that anyone interested could attend.

Out of those meetings, a lot of questions, doubts, proposals, and more questions appeared. But it ended with some interesting conclusions… and a platform.

Instead of having some people reviewing the salaries of everyone on the company every quarter, making most of the company passive to the process, we would now give a formal space every quarter for people to propose their own salary raise (if they thought fit to do so).

It included the actual value, but also a text explaining why.

It also included the global range of salary values within the company as per position.

A screenshot of the real platform we use (some data was removed/altered since it’s only meant to be shared internally).

Step by step…

1. Self propose a budget for the quarter with start and end dates for the proposals are announced via Slack.
2. People can generate their proposal.
3. People can propose other people (but that is only received by the person in question, who can then use that info in their own proposal) if they want.
4. Some information is available for anyone internally to see — who proposed a raise, when was their last raise, how many times have they been raised?
5. Proposals end date arrives — the proposals are checked and can be approved or not (it’s not all or nothing) they can also be reduced or increased.
6. People that haven’t been raised in a year are also looked at even if they haven’t made a proposal.
7. People that participated in the salaries check are assigned with some colleagues — before the salary updates are done they should inform everyone how their proposal went (if the raise will occur and if so, if the value is the same as proposed).
8. For transparency, an overview is shared internally via Slack — a number of proposals, minimum value proposed, maximum value proposed, and the total sum of the proposals.
9. Salaries become final and the payslips are sent. ## What’s the catch? Well, we still haven’t found a way that doesn’t need the checks. We were trying to reduce that to a minimum.
   

Something we found after the first iterations is that it’s easy for someone to have (at least some of) an idea of how their skills compare to those on their team. But it’s much harder for them to have a global picture within the company.

The checks remain due to that (to keep global fairness) and since we mustn’t forget a company must be profitable to remain alive. While each person can make an honest proposition, it can and must be inserted into context:

• Company budget.
• Skills position within the entire team and company.
• Which other self proposals are at stake.
• Market value.
  

If we can’t accept all, we need to have some people establishing some sense of priorities. The criteria are normally:

And especially, “if we had to hire that person today, what would be the offer?

That last question is the pillar stone for a proposal to be accepted or declined.

Who does this?

Most of these checks are done by the founders of the company.

They try to have a broad look over everyone. But of course, as the company grows they may not be able to reply to those three questions by themselves. When they need to, they ask some people within the company (that rotate according to the needs) to provide some feedback.

But?

So, those people that do that ‘check’ are evaluating people?

From a point of view of performance evaluation, definitely not.

The attempt is to try to check if, according to the skills and reasoning provided by each person, there is a global balance.

We haven’t finished our iterations…

Some people struggled when thinking of themselves using this process. The most common issue was “I don’t really know what is a fair value to ask, since I’m not used to asking for raises.”

In an attempt to help teams deal with this — in a simple and fast way — we are now experimenting (in a small set of teams) some feedback platforms to:

Get quick feedback within the team (complementary to the feedback method we posted before). It takes less than 15 minutes. Help each team member have more insight into what value the team thinks they bring to the table.

As we try with different teams, we will soon have a clearer picture of if this is helping as much as we hoped.

I won’t go into much detail over this, as we’ll probably address it in a future post, if we find after the experiments that this really helps people.

Is this perfect?

Let’s be clear, no, I don’t think this is a perfect approach. But I also haven’t seen one that is — at least yet!

I like this one as it puts each person front and centre. It creates an incentive to have more self-awareness and propose a salary without any taboo.

More than anything else, it’s the reason why we did it. We don’t just accept the world as it is presented and do something because it’s ‘how it’s done’.

We really push ourselves to find better ways to do everything. Sometimes we manage to do it, sometimes we don’t.

The big question for everyone reading this is:

• What would you prefer, a standard performance review with a raise process or this one?