My question is, isn't this specifically anti-competitive wage fixing? This seems exactly like RealPage but for employee compensation. As far as I know, colluding on wages like this is illegal. Is there something about the company that I'm missing?
My question is, isn't this specifically anti-competitive wage fixing? This seems exactly like RealPage but for employee compensation. As far as I know, colluding on wages like this is illegal. Is there something about the company that I'm missing?
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I cannot comment on the legality of this kind of data sharing, but as I and others have pointed out, it has existed for a while. I do agree that it is concerning. You can freeze your Equifax The Work Number report at least, just like other credit reports.
[1] https://theworknumber.com/
That felt like a huge breach of privacy. Given that equifax had already proven incompetent at keeping my data secure, I immediately sent HR a request to stop sending my supposedly 'confidential' pay info. They politely told me to kick rocks, so I went on TWN's website and froze that report so no one would be able to request it, and it will be a cold day in hell before I thaw it.
"...for the purpose of automating employment and income verifications. This feature helps streamline the process for employees who may need to provide proof of employment or income for loans, credit, or public aid."
https://techcrunch.com/2023/06/27/gusto-remote-deal-500m-rev...
Surely that can't be legal?
It's a bad argument through and through.
But, of course, that says the same thing. These companies are scumbags because that's how the customer wants them to behave. In this case, because it makes executing payroll cheaper for the customer, which is a highly desirable trait to the customer.
IBM for example waits to fly you out to orientation in Armonk before they show you the binding employment contract with dubious clauses.
These businesspeople know this. Introducing pressure and a sense of inevitability of poor conditions is part of the game. And they know that it's scummy. But Ayn Randians will defend them to the grave as they eschew the responsibility to build a stable enduring economy for one that disproportionately rewards them.
Framing it as the customer wants this level of strongarming is the same as saying they want bloody revolution when it inevitably follows. What customers actually want is for scumbags to be banned from leadership roles in the economy, and for toxic business strategies to be regulated out of relevance.
https://employees.theworknumber.com/employee-data-freeze
Most highly-paid people have no idea how much privilege this affords them.
You wonder why so many businesses are nice to you? It’s because they’ve already looked you up and know you’ve got a high income and are a millionaire.
Write a personal check for your next automobile? Sure thing, you can drive it off the lot a few minutes later. They won’t even bother cashing the check for a week or two.
Try doing something like that as an hourly worker, even if you’ve got the money in the bank.
The dealership can also just call the bank to verify funds. Which would be reasonable and non-discriminatory all without needing a third party and wouldn't involve your salary at any level. Aside from this it's the financing company that cares, not the dealership, who only wants the car off their floor credit plan.
So what you're saying is it _shouldn't_ matter if you have money, because if you're a low income earner, you should be treated poorly, and you're happy to be personally invested in a system which creates this outcome.
It not only should be regulated but you should feel a little gross for saying any of this outloud.
From what I understand from my cousin, a career criminal, there are entire theft rings working off of databases such as these. He knew mostly of car-related theft rings, but I hear about safe-cracking burglaries quite often, usually stealing Rolex watches or precious metals.
Or at the very least, require Equifax to send free physical mail notifications to everyone when their data is accessed, stating when, by whom, why, and what answer was given. (Physical mail because there's no other predictable way for the general population.) Yes, I realize this would be financially unsustainable for Equifax as they currently operate, but that's their problem to solve. Even as someone who myself has excellent credit and many years of high income in my file, they're creepy and shouldn't be catered to at the expense of our privacy.
And don't even get me started on an average person. I get blank stares when I go on a privacy rant. At best, they simply do not have time to care.
I have no connection with the industry at all. But that doesn’t prevent me from understanding the implications.
Equifax does this stuff because it is profitable. It is profitable because companies buy it. Companies buy it because they can put the information to use for their benefit. In doing so, some consumers are harmed and others benefit.
Also, for the record: I don’t often buy cars, but when I do I choose the best financial option. Sometimes that would be financing, other time it would be writing a check. One factor that everyone should consider it that your free time has a higher dollar-per-hour value than your work time.
This doesn't seem right to me. I think it would only apply to someone who felt comfortable with the level and stability of their income.
When I was self-employed or job-hunting, I would always trade an hour of free time for an hour of employment.
Personal check? What year is this?!? :-)
Don't know if things have changed since.
2. If they charge you extra for using a credit card, they're breaking even
3. If they _don't_ charge you extra for using a credit card, they're paying 3% of the purchase cost to the credit card company (so, $1,000+)
So yes, it's a dick move to pay via credit card for any purchase in the thousands of dollars, if you have the option to pay by check or debit card. I always offer to pay by check if I know the money for the CC will come out of their pocket.
Bought mine with cash but realized it was Sunday and I didn't have a way to get a cashier's check from a savings account.
They offered to put the down payment on a credit card and finance. Paid it off once I had access to the account.
Ended up being a wash, the points were worth a little more than the percentage charge.
I'm not saying that rich people do not have privilege - they do. But it isn't because your local car dealer looked up your earnings data.
"Oh, aren't you happy we live in a world where the rich are explicitly treated better because they carry around a big sign saying 'I am rich' when interacting with corporations?" No. I am not.
Is it yours though? The employer could probably argue that it's theirs. Devil's advocate: I think it's widely understood that entities can be transparent with their data if they choose, other than NDA scenarios.
Not "Oh hey there, you're not allowed to do that, stop that", but "We are diluting your stock by a quarter and distributing it to your workers" type shit.
I find it amusing/annoying how many Free™-market boosterism messages are actually contradictory "heads I win, tails you lose" constructs. For example:
1. "Regulations are bad, because left to its own devices the market will be optimally-efficient, once everyone has perfect-information about all the prices and deals other people are making."
2. "Regulations are bad, because cartels and collusion will be destroyed by defectors who use their freedom to make secret prices and hidden deals."
Sometimes these arguments come from the same people, but even when they don't they represent two wildly incompatible ideas of what "the free market" really is.
It's like a strawman fallacy did a fusion dance with an ad-hominem. I see it all the time on HN - surely it has a name.
No, what's disingenuous is your weird attempt to stifle an entirely on-topic discussion which has made you uncomfortable. You're suggesting that we may not criticize a stance or argument unless another Hacker News user has directly advocated for it. That's not how it works, or else we'd never be able to talk about things like the DMCA or Microsoft's forced-reboot update policy.
That said, how about we steer away from pure-meta personal attack posts to something that at least involves the original topic of markets and market-actors, starting with:
> I'm just going to make them up and pretend that an imaginary member of [group that I don't like] said them"
Your comment is saying--via sarcastic subtext--that I have "made up" items #1 and #2 and that (to substitute GP's term) "free-market ideologues" do not advance either argument about efficiency or cartel-risk.
Is that really what you believe and you'd be convinced otherwise by examples, or would you like to issue some non-sarcastic clarification?
Incorrect. I'm pointing out logical fallacies and emotional manipulation. Nothing disingenuous here, just rationality.
> attempt to stifle an entirely on-topic discussion
Incorrect. This is "flamebait....generic tangents...internet tropes." (as the guidelines say to avoid) because, as already pointed out, nobody in this thread has made these arguments together.
> You're suggesting that we may not criticize a stance or argument unless another Hacker News user has directly advocated for it.
Also incorrect. I never suggested that. Additionally, even if I had, you're not criticizing a stance - that's a dishonest and incorrect portrayal of your comment, which was fabricating an imaginary contradiction between two distinct arguments, as a means of attacking a group you didn't like.
> That's not how it works, or else we'd never be able to talk about things like the DMCA or Microsoft's forced-reboot update policy.
Also dishonest and incorrect. Microsoft is a single organization that makes public statements that you can link to and point out inconsistencies in.
That is not what you're doing - the free-market HN users that you're emotionally attacking (because that's what it is - there's no logic here) are not a single person or entity, but a highly diverse group of individuals with wildly different opinions.
What's more, you didn't even respond to a comment that one of them made - you're fabricating the existence of one of them that has a set of contradictory opinions (that you've also invented) to try to generally attack the idea that they represent. That's very bad form and very clearly against the HN guidelines.
> That said, how about we steer away from pure-meta personal attack posts
You're violating the guidelines and engaging in dishonest and anti-intellectual emotional manipulation and ideological warfare...on a site that's designed for intellectual curiosity. It's very reasonable to call that out.
> Your comment is saying..."free-market ideologues" do not advance either argument about efficiency or cartel-risk.
That is not what my comment is saying or implying - that's you fabricating a strawman.
You are "fabricating" a person because there's no specific person that you're debating with. That clearly does not mean that there don't exist people who don't hold those beliefs individually (or even together) - but you're not referring to a person in your comment, you're referring to an imaginary archetype, and you're doing so as a way of attacking it.
I've absolutely met individuals who hold either of those positions individually. And I have definitely met people that are self-inconsistent with respect to the beliefs that they hold.
Neither of those things justify you inventing a nonexistent self-contradictory person as a way to wage ideological warfare against a group/ideology you don't like.
"Please don't use Hacker News for political or ideological battle. That tramples curiosity."
https://news.ycombinator.com/newsguidelines.html
Who said they were talking about HN users? AFAICR, the GP explicitly said that was not what they were talking about.
Maybe you're not arguing from bad faith; just bad reading comprehension.
I wouldn't say that HN commenters have been especially influential advocates in selling a potent brand of free-market capitalism to the United States of America. That happened long before HN began, and even the other advocacy efforts of people like Thiel are at this point a drop in a very large bucket.
Silicon Valley antitrust enforcement is especially topical because the government is apparently gunning for Google now, but if Realpage-like labor price collusion becomes common in the corporate world (inside or outside of SV) that's a substantially bigger deal.
Not arguing that payroll information can't be protected, my only point was that your comparison was off.
You can also request them to do likewise, with similar recourse.
A request is nothing without teeth behind it.
Most of the taboo around it is cultural, because people here attach their self-worth to their paycheck.
You could also always do it anonymously or pseudonymously. You'd have almost no chances of retaliation in that case.
That doesn't mean I'll be flying a kite in a thunderstorm, but it also doesn't mean that you should lock yourself in a bunker the moment the sky turns grey.
Most of the taboo around this is cultural, not retributive.
That there was no way to sue the company in that example is a demonstration that the employee lacked any right to break any taboo.
As such there are teeth anywhere that is at will for any request whether it is reasonable or not and whether it relates to a taboo the employee may be expected to have or not.
No funnier response to a post directly proving you wrong. L
They're welcome to do what they want with that, but once it includes the ability to make inferences about me as an individual, more than the company, it becomes my data. I likely have to choose to share it to meet the terms of the emploment contract, but that doesn't change the appropriate ownership.
Try and apply whatever rules you want to IP the company claims to own? Surely the exact details of some trade secret process also belongs to me and I can do whatever I want with it because I need to know it to fulfill the terms of that same contract right? I can sell it to a 3rd party just 'cause right?
So while, in many jurisdictions, it's fine for companies to sell data collected on their employees, and it could be argued that those employees consented to this data sharing by working there, one could also easily argue for an employee protection law that prevents companies from requiring their employees to consent to this.
Edit: it is now some time since I studied the GDPR, so I'm actually unsure if, for healt-related data, it can be used any legal basis other than consent. The reason being that health, together with a few other categories, has special protections.
Like, I haven't seen this happen, but could a recruiting team buy the compensation data on staff at a competing firm, identify those that look like a good deal, and poach them starting with a "we'll offer you k% more than your current employer"?
Could market analysts use this data to notice when a company starts firing more people, or starts giving fewer/smaller raises? What if the next time your company showed up in a Gartner or Forrester report, it came along with a caveat "however given decreased investment in staff, their pace of product development or quality of client services may be at risk."
In the private sector, your comp is determined by a negotiation undermined by an asymmetric information disparity. HR at a hiring company has way more information around market comp as it is without having your exact current comp when they make an offer.
What I find particularly egregious about this is that management at this company had admonished me that my comp was 'confidential' and that I shouldn't discuss it, while simultaneously selling it to equifax.
https://www.weforum.org/agenda/2018/11/finland-has-just-publ...
Most of these jobs are not special or meaningfully "public". They're just normal jobs for firms that happen to be public bodies. I don't think it's at all obvious that people are knowingly and deliberately making these tradeoffs by working there.
That they receive their salary from the tax payer, the public is their employer, and it'd be pretty odd if your employer didn't know what they paid you. They're executive organs of the state, police and firefighters, unlike private workers, also don't get to choose what laws they enforce or what fires they put out. If you're a civil servant you obviously forego most of the rights of private sector workers in exchange for usually lifetime employment and set pay rates.
I do not think it can be stopped, but the days when a wealthy person could safely live in a suburb and have the kids imagine that they are middle class is long gone. It is terrifying. The best thing for a wealthy discrete person to do is move to Singapore or Australia, or somewhere with a sufficiently low crime rate to feel comfortable, or get quality security, which sucks.
Example: https://silentprofessionals.org/jobs/protection-agents-liais...
https://fiscal.wa.gov/Staffing/Salaries
Literally every single State employee's salary is listed here.
That's not a problem for the public sector because both sides can see it and there is no real negotiation (you still save time/money by not having to go thought the interview process to figure out your potential compensation).
Thanks
Living addresses, birth date, vehicles, pets are available in plain text without login and can be Googled.
The problem is identity fraud, and evil corpos like equifax plus some weird laws facilitate it way too much on a giant scale. This is what's infuriating.
They don't give out salary info in employment checks though. AFAIK they require your explicit permission except for government agencies who use it to verify your eligibility for benefits. I would be surprised if they are not selling aggregate salary data though
The only way this stops is when people return the favor (on the spot, without a notice period).
#sad #speakingOfMonopolies
This made getting approved for a mortgage more difficult. These days, loan officers just expect to be able to hit a button and get all your info.
We're losing the privacy battle.
IMO this type of information should be illegal to sell or request.
https://www.congress.gov/115/plaws/publ174/PLAW-115publ174.p...
To be fair, I'm not sure if the same rules apply to whatever type of "freeze" the work number offers. I'm not even entirely sure it's regulated at all.
That said, I have seen anecdotes online that say that when somebody pulls a frozen The Work Number report, it comes back as blank even if there is information in the file. This is different than how freezes are handled elsewhere. Most places just report back that the report is frozen when a frozen report is requested. They do not imply anything about the state of the information in it.
To communicate a freeze request, send an email to the address below requesting a Freeze Placement Form: [email protected]
I love that they have ALL my personal info, but I can't create an account with a password longer than 16 characters.. Why the heck are they not storing the hash?
Great security.
https://www.pave.com/blog-posts/announcing-paves-series-c-an...
How does this ultimately not end up having a depressing impact on salaries?
Spits out 403 error forbidden
Gosh, that’s awful.
A good US.A. could probably argue this meets that bar. Didn't they just do something similar with the rent fixing from that similar SaaS product?
* RealPage sells raising rents, not just market info.
* RealPage pressures clients into taking their higher rents.
* RealPage also pressure clients to refuse to rent at lower rates for their own narrow economic interest - in other words, they actively seek to circumvent competitive pressure to keep rents high. (edit: to clarify, I mean they discourage lowering rent to attract a renter)
Pave does sound like it gives businesses a leg up over employees in wage negotiations, but until it e.g. starts promising clients that they will be able to pay lower salaries, the critical element of coordination won't be in the mix. Pave gives you the data, but you can still choose to pay above market to attract talent.
- Set reasonable ranges to find the right candidates they are looking for faster and minimize hiring friction
- Standardize payment levels in a way that reduces legal liability in certain states like Colorado/California. Or the most generous reading of "reduces legal liability" would be "promoting fairness".
- Reduce the time spent by HR/other teams of negotiating or setting salaries, as they can simply target some target like "we want to pay more than 60% of companies like us"
- For budgeting/forecasting with new hires, this allows companies to have more confidence in their estimates as they plan hiring.
- Some companies now offer calculators even before you're hired with what your salary/compensation might look like, such as https://posthog.com/handbook/people/compensation
But yes, overall I do believe that most companies also expect a general reduction in salaries when they use these tools.
If they were aware of market rates, they could avoid making potential candidates laugh at them.
Not that I’m not happy with you, the OG and clearly greatest of the name!
"Dilution? What? Stop worrying about made-up words and let's go change the world!"
When you don't know what the market is paying, you're liable to lowball offers and refuse to raise them, and not get the employees you want.
If you know market rates, you can provide reasonable first offers, or have a more accurate idea of how high you should go.
It makes me wonder how it would affect salaries if companies were required to make the salary distribution public for all their roles. So you knew both the range where you were applying, as well as at other companies.
And also how that would interact with unionization. E.g. would it make collective wage bargaining less necessary to some degree? If workers felt they had the data to know they could bargain individually for more money?
I certainly don't trust that this doesn't hold wages down overall, particularly in the boom hiring market we had until recently.
A small businesses owner who pays themselves whatever is left over after expenses doesn’t care about what other companies pay, the company only has so much money. Apple could increase salaries up to the point where they make zero profit, but the goal is profit maximization not salary maximization.
It’s fundamentally the attempt to limit salaries that causes companies to look at the overall market.
Hiring well is hard - it's not super obvious if you aren't paying enough or your company isn't desirable or what else is the cause of not seeing good candidates. While in theory you could solve that by wildly overpaying, in practice you have to be able to justify your decision to higher ups in most cases, and pointing to a tool that shows what you really need to pay to get good people can be very helpful. I still find it gross, but, there are practical situations where it will drive salaries higher.
What you just described is speeding up a process not increasing wages.
If a company simply isn’t offering enough money they aren’t going to get the workers they want. Which then forces the company to either go without or increase their compensation, just like how every other market works.
> your company isn't desirable or what else is the cause
The clearest example of this principle is companies eventually learn they need to pay the asshole tax. Market research may suggest X is a reasonable number, but they simply don’t get enough people without paying appropriately.
> will drive salaries higher
It will drive some offers higher and get workers sooner, but an offer not accepted is a salary that doesn’t exist.
I've never seen a worker walk away once an offer is made. Getting workers in the door in the first place is hard, though.
Which means that it is really the marketing that needs to be improved. But how...
> how every other market works.
Every other market that has suffered from this kind of marketing problem starts to publish sale data! The labour market has just been slow to catch up with everyone else here. No doubt because, historically, getting people in the door was easy. That has only somewhat recently started to change.
I’ve personally walked away from several offers. It’s not uncommon to receive multiple offers at the same time and you can only accept one.
So perhaps your offers have been excessively generous?
But either way, it's pretty clear that the prevailing problem is finding people at all. Not just me, but most businesses have been struggling with the same problem. You can't tempt someone with more money if you have no way of communicating with them.
Which goes back to the marketing problem. Absolutely there is a marketing problem, but publishing price data is exactly how other markets have solved the problem. We shouldn't be shocked or disappointed that labour is going the same way. That's how markets deal with the problem.
To be clear, they're not "pressuring" them, they simply drop clients as a rule who don't use their suggested rent prices at least 80% of the time.
If they had limited themselves to simply reporting the numbers, and letting landlords make their own decisions they would probably be legal.
That's why it's "legal tacit collusion" when one leading law firm announces salary increases and other law firms immediately match it: https://www.reuters.com/legal/legalindustry/large-law-firms-...
That type of salary matching has been happening for decades.
What's illegal is competitors making agreements with each other to set wages -- via secret emails, etc.
If it were public, employees and job seekers would also have the information.
The law firm example seems imperfect though. Publicly announcing that you’re raising salaries isn’t really the same as internally sharing that data and choosing to set the same salary based on that.
Not really ... If you're looking to hire workers in a particular region, how do you know what a competitive wage is? Well ... you look at what similar firms are paying their workers. How do you know what similar firms are paying their workers? You read surveys, industry reports, public statements, etc.
Nothing about any of that means you cannot offer a higher or lower salary for the same position.
Because it's public so doesn't reduce the amount of bargaining power employes have and therefore distort the market. Which is the main problem here.
Even price sheets that we would consider very rudimentary today were part of that.
Collusion requires an agreement between rivals that negatively disrupts market equilibrium. Is this company not actually making the market more efficient and transparent? That said - an efficient market is good for the collective, not necessarily the rogue / outlier individual.
I'm sure you practice what you preach and tell all your employees what their coworkers earn?
With a few exceptions, I've found that companies that talk about transparency are transparent with everything but employee salary
Every single developer should take this to heart. The phrase I once used at the end of an annual review was, "you can't give me a review like that but a raise like this!"
Yes, my manager had to get permission to give me the % increase I wanted, but it was to his benefit to do it since he wanted me to stay.
No, not at all. Unless applicants/employees get full access to the same information.
That's the point of these systems. If it's not illegal, then it should be.
__________
To illustrate this, imagine some kind of over-the-top incontrovertible conspiracy to depress wages. I'm talking a secret volcano-island base, a letterhead with a Et redigam operarios in servitutem in latin, members greeting each-other as "Hello, fellow conspirator!" while twirling deliberate Snidely Whiplash mustaches, etc.
Then a new company joins the cartel, and it turns out that company was one of the ones previously paying below the fixed-price.
The fact that some members pay more on joining doesn't change the core nature of the system, especially if there's "noise" in the organic prices.
DOJ Withdraws “Safety Zones” for Information Sharing and Other Collaborations https://www.crowell.com/en/insights/client-alerts/doj-withdr...
Sharing compensation data across companies doesn't necessarily mean wage fixing. Company A can use the compensation data from Company B to try and compete better for talent.
Not saying thats what it will be used for, but it's technically not wage fixing.
I am not an expert on wage fixing laws in the US, but I came across a class action on wage fixing a few days ago (Ron Brown et al v JBS USA Food Company et al) where part of what was aledged was the illegal exchange of salary data via surveys [1].
> The Red Meat Industry Compensation Survey conducted by WMS on behalf of the Defendant Processors violated the Safe Harbor Guidelines in at least three ways. First, the Defendant Processors, not WMS, collectively managed and controlled the annual Red Meat Industry Compensation Surveys. Second, those Surveys often contained information about the Defendant Processors’ future compensation plans and practices. Third, Defendant Processors had extensive discussions about the Survey results, including at in-person meetings, during which they disclosed their respective compensation rates, practices, and plans
[1]: https://www.classaction.org/media/brown-et-al-v-jbs-usa-food...
Alleged doesn't mean illegal. In this case this point never saw court; the sides settled.
And what this claimed to have happened is not what is happening here.
What is alledged is that they did that. And if they did, they would have violated the law from my understanding.
> And what this claimed to have happened is not what is happening here.
That might be, but that's not entirely clear to me. I don't know if what Pave is doing is legal or not, but it seems to me that the line is quite fine and it would be fascinating to see this play out at court.
It's possible the purpose of wage benchmarking companies is to allow bosses to say they pay the 95th percentile - which is useful to be able to say, when someone at an all-hands Q&A asks about raises and bonuses.
Then the benchmarking company simply has to define 'comparable roles' broadly enough to give the customer the result they want.
It's thought by some that this is how CEO compensation has gone up so much: Corporate boards of directors have compensation committees, which are fed survey data about comp ranges; a comp committee will say, "We want our CEO's comp to be in the top quartile" — which, as time goes on, leads to an inexorable upward ratchet effect.
"I want to sell my water at the upper end and market it as a gourmet brand"
In fact if every company did pay at 95th percentile then I’d say it’s a good outcome. There’s a 5 percentile slack which is not too bad?
My company has done this in the past sorta indirectly, we were losing a lot of people to competitors and data like this is how they justified paying a bunch of us better so we wouldn't leave. I agree that it could be used to fix wages, but companies will always have to pay their best talent more if they want to retain them, whether that means paying them above what the data says or if it means inventing new job titles for them to progress into.
(Got the link from a comment on another recent HN post, IIRC.)
I always ask myself, as to the legality or ethics, would this survive review by a jury of my peers...
you are not allowed to tell anyone how much you make so you might be in trouble if your found out but the companies share this info without your consent. From my POV make it all transparent.
It's not like Glassdoor is restricted to employees, they even offer specific services to employers.
Company A could make offers and negotiate with prospective hires based on the value they can get out of the hire. Rather than secretly leverage surveillance capitalism against the prospective hire, to base their offer on what the person is currently making (and, hey, if lots of employers do that by convention, you pretty much have collusion).
This also sounds like it will reinforce some negative behaviors. If the data shows that other companies are paying women 80% of their male peers, shouldn't this recommend I also pay women 80%? But I doubt the output will spell it out that way, will I even know it's influencing me this way?
Setting company wide salary bands actually HELPS fairness in pay by providing objective ways employees can argue that they are underpaid if that's the case.
It also comes in from how / if they choose to promote. If they take too long or if they just don't put you up for promotion / reject you, overall earning potential is weakened.
Do this enough times and it becomes a substantial reduction in life-long earnings, life-long title, respect, etc.
Information symmetry doesn't prevent fixing. E.g., rents are all public information.
If it is public, won't employers still have access to the salary ranges for free? The very thing Pave is giving them at a cost?
They don't need to officially twirl their mustaches and laugh evilly while telling each other how they're definitely fixing wages. They just need to share data on wages with other companies in the same or a similar business with the intent of decreasing wages. That is already illegal, because they're colluding with competitors to keep wages low.
How am I ever going to realistically negotiate salary vs a company that has this level of information (even during performance reviews)? And frankly something that worries me is, what level of data are they getting? If it’s tied to your HR system, does it get anonymized performance reviews? If every company can perfectly profile me and place me in an expected salary, I as the employee give up all my power. That’s strictly bad for me
You're missing a lot with your second point though. If a company has excellent salary data and can put in you a band, then it also means that you have better grounds to argue for raises when you gain experience, or argue if you are underpaid, or even find jobs at companies who intentionally pay a higher percentile to market as a way to attract better talent.
In contrast, if we all operate 100% blind with no data, as many here seem to want, it would lead to all sorts of unfair wage situations with people doing equivalent jobs earning vastly different amounts. This sort of environment is biased towards more aggressive people who have strong social skills when it comes to negotiation. In fact, you see exactly this when companies choose not to buy data like this to set their bands.
On the second point, I would argue that you have very little ability to determine when you’ve gained enough experience as an employee to argue for a raise. Whereas an employer with access to Pave has a _ton_ of ability to determine whether you have or have not. Yours is based entirely on personal experience and feel, plus maybe talking to a few coworkers. Theirs is based on aggregated data from thousands of employees
Mistakes get made and not all managers are the same, but believe it or not there are companies where senior management does try for consistency and fairness in how they set compensation. These companies also often have internal studies run that check for biases or oddities in compensation. E.g. which departments are above the standards, which are below, which are not progressing juniors enough. Without data all this is impossible. You can't build a fair, objective, and especially not transparent system without data.
Pave user here. Absolutely not. It's anonymised comp data. Essentially salaries and job titles only.
Whilst I do agree with your point that data like this should be publicly available, I'm not sure I understand how it gives employers a negotiation advantage?
It seems like there would have to be an agreement or at least a collective incentive to lower wages.
While companies could use the data to ensure their offers are always below average (pushing wages down), they could also use the data to ensure their offers are above average, pushing wages up.
Think about it: prices are transparent in most markets and that doesn't seem to generally lead to anti-competitive prices. In fact, it seems to encourage companies to compete.
???
In accordance with HN guidelines I am going to resist giving a snarky answer and will instead clearly articulate: Companies clearly have a strong collective incentive to lower wages.
"While companies could use the data to ensure their offers are always below average (pushing wages down), they could also use the data to ensure their offers are above average, pushing wages up."
They may do both. Collude to keep average wages low, so that when they offer outliers "above-average" it is still cheaper to cross that many standard deviations.
"Think about it: prices are transparent in most markets and that doesn't seem to generally lead to anti-competitive prices. In fact, it seems to encourage companies to compete."
The problem imo is less about transparency and more about information asymmetry. It's asymmetrical that companies have access to literally what every other company is offering, while the employee is sitting there trying to guess based on glassdoor (which is utter shit information) and levels.fyi (marginally less shit?).
Of course they all have an incentive to pay the lowest wages they can. I did not think we needed to state that.
But what I don't see here is a synchronizing mechanism. That is, what here will push companies to *collectively offer below average salaries on average* vs above average salaries on average?
> ...Collude to keep average wages low, so that when they offer outliers "above-average" it is still cheaper to cross that many standard deviations.
Yes, companies could collude. CEOs and HR managers of a range of companies in an area or industry could start an email chain, or conference call, or slack channel and commit to keeping their average offers at 45th percentile or lower. That's collusion, and illegal.
But is that what Pave is offering? What's the communication channel or other synchronization signal they are providing? A chat channel? Bonuses for companies that keep their average offers below average? Penalties for companies don't? IDK, perhaps there is some collusion mechanism they provide, but we should not just imagine there's one without a reason.
> The problem imo is less about transparency and more about information asymmetry.
Sure, yes. But that's something different than collusion to fix wages. That's an argument that we want organizations like Pave, but ones that will provide the same data to job seekers.
They’ve had that product (with various names) for years.
It’s all very boring and above board.
If companies choose to talk to each other to suppress salaries, they’re not using our tooling to do it.
There are also firms that will do all this work for you especially if you lack enough people in your own offices for an internal benchmark. If you’re building a CAD tool you can tell them (paraphrasing) to pretend you’re just like Autodesk and ask how much you should pay a UI designer.
It's not only startups - I know decades-old, listed firms that use it too.
(Background: In Germany not so many companies pay competitive wages for their software engineers, especially not, once you worked for some years and are no longer a bloody junior. So I calculate it would result in a wage increase for me, since everyone says I am underpaid for my experience.)
As long as Pave just helps employers look backward in time so to speak I’m not sure I’d call it collusion. But if they enable some kind of coordination between future potential employers, then yes, maybe it is.
In the RealPage case the coordination aspect consisted of providing a recommended rent for the property if I understand it correctly. I guess the equivalent for Pave would be if they gave a recommendation on what compensation to offer.
As you say, the boundary is often about what pricing should be next year. But there's often a lot of nudge-nudge-wink-wink given good information about what prices and salaries are today.
Sure. Just like a lot of people steal office supplies from their employers or trade small scale on insider information. But that doesn’t mean you could or should build a website to enable that on an industrial scale. Same applies here IMHO.
I've even known co-workers who said "I deserve more $$, I'm underpaid for my experience and job" and supervisor repeats this to HR, then HR checks on it, and a few days later says "true, here's a raise". This was in the 90's, btw. Not a new thing.
This is a true thing I've heard several company representatives say.
> Every landlord wants to say, “We charge below the 50% mark”
This is not a thing I have ever heard any landlord say.
Yes, the law on point is permissive. That goes with the evolution of law.
But assuming for the moment that we want not just avoid injury to ourselves but to create the world now and to come, what are we called to do?
- What exactly do you, or employees, want in this situation?
- What would Pave do if they wanted to take the high ground? Could that be a business differentiator?
- What law could you write and enforce, to protect what interest, without also damaging other interests that are socially beneficial?
I think the organizational evolution towards having loose laws with tightening enforcement, or tight laws with lax enforcement, give way too much latitude to policing/enforcement and create a corrupting political franchise of affected stakeholders taxed with managing regulators.
My hope would be that internet-scalable transactions have similarly scalable regulatory solutions: dead-simple to detect and assess, finely-tuned to the balance of interests, and so patent as to be indisputable. Then people can get stuff done without dealing with the shadows and forces of ambiguity.
Is something like that possible here? Could Pave be a champion of it?
However, more and more states every year are introducing laws that require salary ranges on job listings. What that means is that Pave is basically just organizing the data that's already becoming public for job applicants and employers alike.
https://www.politico.com/news/2024/07/12/justice-department-...
That said, it's exactly the same thing that landlords were doing with that pricing software and the government is coming after them, so maybe pave will get hit with a big lawsuit sometime soon.
Here's hoping this sort of thing gets regulated down into the earth.
What RealPage does is sell a pricing algorithm using that data, which is the bit DoJ and Congress has an issue with.
> Pave: We turn your Google Analytics data in actionable insights + reports with our data science AI algorithm.
https://www.ycombinator.com/companies/pave
I'd say "if you work in a company like this you're a bad person", but sociopaths, sorry, Wharton graduates won't give a shit anyway.
To be competitive you need to be paying more than others not the same as them. This is why FAANG got themselves into a fix of paying 500k for people they would have paid 200k for a year or so beforehand.
Yes, but this interdiction might not be legal. Companies typically add such clauses to achieve a chilling effect. (Ie, you abide because you fear running a risk if you don't). Consult your legal representative.
2) VCs are often the vector by which this all happens. They ask their portfolio companies to pull together the info for their employees, presumably submit it into the companies aggregating everything, and then the startup gets a copy of the recent data.
3) Even done the old way (Excel), the data was incredibly detailed. You can slice and dice by startup stage (series A vs series B vs seed), employee count, region, sector, etc to determine if you're paying market rates or not. This is particularly useful for growing startups, where the founders have no idea what to pay, say, a VP Marketing at their pre-revenue mobile gaming startup in Helsinki.
4) Obviously whether or not this is bad for employees themselves is debatable, but I think people are missing the point that these surveys are ALWAYS skewed UPWARDS due to the much higher volume of data from the large tech companies (because they have far more employees and tend to be offering significantly higher comp). So in practice, the impact is likely to RAISE wages at earlier stage startups who are competing for the same talent as later stage tech.
There are so many variables at play too that it turns into a negotiation like everything else. Say an employee wants a big raise because they are having their first child are heading towards a higher cost base at home. Say the employer simply says "the salary data shows that your current pay is at the market average".
Well, is the employee truly "average"? Perhaps they're a high performer. Does the average number take into account not only the company dynamics (stage, domain, funding, revenue level, etc)? Not perfectly.
But then on the other side, just because an employee wants a higher salary due to a higher cost structure at home doesn't mean they are automatically entitled to it, right?
Then on the startup side again, the manager is looking at the data and thinking about all the time and cost of replacing this person and realizing it's likely more than the cost of just granting the raise.
Then the HR person comes in and says the salary grid -- whose whole purpose is to provide in theory tight constraints on these conversations -- rules this all out, there's no budget or wiggle room. When the Manager suggests the grid hasn't been updated in a few years, HR takes it personally and tells the person to take it up with the CEO.
So then the CEO gets involved. She knows the employee has a unique view on the technology and market direction and considers them Tier 1 can't-lose-them. She knows the grid is out of date. She looks at the data and thinks that she can justify to herself and the financial plan that it'll be OK to do it, with fingers crossed that this doesn't happen across the board because then their runway will shorten considerably.
So the raise happens.
My point is just that the salary information asymmetry is just one relatively minor aspect to this whole negotiation and in the end I'm not sure it advantages the company all that much.
I am not a lawyer, but I believe the fundamental issue with RealPage is that by entering into a service agreement with them, you agree not to violate their price “recommendation” and so you are centralizing actual pricing power into a single entity.
I believe RealPage has some way to negotiate out of this standard deal but it’s not common.
Companies likely insist on staying within certain pay bands for a whole host of legal and HR reasons but they aren’t getting a specific salary from Pave that they are contractually obligated to use in their offer.
And regardless of whether it is legal or not, the problem has to go beyond a handful of small startups for the DoJ to get involved. RealPage is used in 80%+ of multifamily rental buildings in the US. What is Pave's market share? How many employees are affected by their practices?
Complaint: https://www.justice.gov/opa/media/1364976/dl?inline=&utm_med...
more readable Press release for DoJ on RealPage: https://www.justice.gov/usao-mdnc/pr/justice-department-sues...
On the other hand, to know that other companies are paying lower and still able to deliver roughly the same work is harder unless you know how much they are paying.
If you're a new startup founder, you don't always have a good sense of what the default applicant pool should look like. You might have a sense of what quality looks like but how would you know without recruiting experience what the mix of quality to non-quality applicants is supposed to be? There are many reasons why you might not be getting the number of quality applicants you want, and compensation is just one of them. Salary benchmarking data helps eliminate that as a possible cause.
How do you explain people moving to the USA for better salaries and crap on European salaries when Europe affords workers more vacation time, more social nets, healthcare, etc? Because the USA pays more money.
https://www.ycombinator.com/companies/backpack
https://news.ycombinator.com/item?id=8199286
blockchain is the solution to exactly nothing. zero things are better with blockchain. zero. in the case of hiding cannabis use, the problem is that it is illegal despite having valid medicinal uses.
Boy will you not like the "high vibrational" commentary people would have for that adventurous™ libertarianism©* of yours.
The "medium vibrational" ones merely wish its pursuers behind bars, the more energetic ones are discussing optimal guillotine blade shape profiles.
* * * * * * *
Question to you.
Would a startup that maintains a public database of names, addresses, and approximate locations of people with net worth over $1B be libertariously adventurous enough by your standards?
You know, like Page, but crowdsourced, and with wage workers as the users (not as product). Purely opt-in. Give it a higher-energy vibe name, like, say, 'rage (as in "average" - for the average people).
Anyone who sees Elon Musk could anonymously report his location to 'rage, giving wage workers an option to avoid providing services to him - just like Pave gives employers an option to avoid getting services from undesirable workers.
Are you a pastry seller who'd rather call in sick the day Peter Thiel or his buddy JD Vance are in town again? Get 'rage, and avoid the awkward interaction.
Anyone who gets a wind of someone fitting the wealth profile will have an option to anonymously contribute this data to 'rage's Wealth Accumulator Registry (Rage WAR™).
They may be breaking their NDA's while doing so, but that won't be 'rage's problem, of course. 'rage will not be in the business of policing individual actions and limiting users' personal freedoms.
The user identity will be e2e encrypted, guaranteeing anonymity. It will be impossible to prove that someone has a 'rage account against their will, or find out they have one.
The app, however, will also allow users to confirm that they have a 'rage account if they choose to do so. This way, wage workers who are concerned about their peers could ask them to privately confirm their account status and contribution karma to avoid sharing a workplace with a scab.
Registration will require entering your own personal wealth data into 'rage WAR™.
While tax returns can be faked, someone uploading a copy of their W-2 paystub will practically ensure that one does not fit the target wealth profile for the B-status.
Those could be faked too, of course - and one could see large employers not wanting to collaborate with 'rage for whatever reasons.
That's exactly where startups like Pave come into play to verify the correctness of the data.
'rage and Pave would not only complement each other in the financial data ecosystem, they would form a natural symbiosis, giving wage workers incentives to ask their employers to use Pave. As for Pave, 'rage would merely be one of its clients, consuming W-2 data just like everyone else.
I hope you will find this proposal sufficiently adventurous and relevant; and I would love to hear your thoughts on this matter.
It is.
Also, when I asked whether they would have the same libertarian attitude regarding a crowd-sourced app to keep tabs on people with net worth over $1B, my modest proposal[1] got flagged and hidden -
- unlike the insulting comment that called the users who have an issue with Pave "schoolmarms" that "infest" the place, like pests to be exterminated.
Go figure.
Hypocrisy is OK on HN, calling it out is not.
[1] as in https://en.wikipedia.org/wiki/A_Modest_Proposal
I thought libertarians are right-wingers kidding with us /s
> I don't think it's in a "libertarian ethos" to do wildly unethical and immoral things on a large scale
I personally conflate libertarianism with wanting all regulations removed and whining about Big-Government, and then crying to Big-Government to bail you out when you crashed the economy with less-than-informed gambling.
> If that actually is libertarian ethos, then it sucks.
Astute observation!
Now, obnoxious white people in Silicon Valley would be upset that multifamily housing had allowed displeasing minorities in, but man would that make life better for everyone. I lived in East Asia, and it is really nice when cities are not too expensive for regular people to live in. Furthermore, I have no sympathy for rich @holes who complain about losing their expensive view.
Freedom helps all, but especially the poor. The leftists have tricked people in California and NYC into thinking the system fails the poor, when in reality it is their stupid regulations that made these places expensive.
Btw anyone else seen that bear rummaging around? Any idea how to get rid of it?
And hopefully everyone else "successful" having the morals of a greedy chimpanzee follows the same fate as those swindlers. Whatever happened to doing good by people and society (or at least pretending to)?
Kinda. Often this casual law breaking isn’t entirely victimless even if it benefits both consumer and the startup. I think Schmidt was talking about using content to train models. So artists getting short end of stick. Or Airbnb causing locals getting prices out or whatever.
There is certainly some dodgy protectionism happening of the sort you describe but there are also externalities borne by society for this break laws startup style.
And the externalities introduced here are not borne by all of society, but only by a small number of people (How many important artists are there? 10,000? 100,000?). Just like horse-and-buggy drivers were affected by automobiles, while the vast majority of people benefited from automobiles.
That is…quite a stance. Not quite sure what to even say here.
Uber "won" because they cheated. They operated at a loss for almost 15 years, on the welfare of investors. Guess what, mom and pop running a taxi can't live on a negative wage.
Wrong on at least one count. I've never been refused service while black from Uber. The taxi industry was brought out of the dark ages of discrimination by Uber et al. Taxis (around the world) have tried to rip me off almost half the time I've used them, with no accountability.
I also recommend HoboSleepinCar Driveway as a service next to your home. The consumer has spoken!
A lot of things governments do would be illegal if private companies did them. Are you arguing that governments shouldn't have special abilities that companies can't have? Should every road be owned by a company? Should the police report to Amazon instead of the local municipality where you may actually have a say in how they are run?
We give governments additional powers because they, at least nominally, answer to citizens and society. Companies have no such responsibility.
Obviously that's easier said than done, and SV has a track record of "ask forgiveness not permission" as a successful tactic for effecting policy change. But many times it results in indefinite undermining of government which leads to selective enforcement and cartels, which is worthy of criticism (of both government and VC-powered undermining of government).
And to make those who interfaced with the prior system in good faith whole again; eg: drivers who bought taxi medallions for six figures USD, only to have the value of the medallion plummet with the arrive of "rideshare" services.
Yes, that's kind of the main difference between government functions and private companies. Are you saying the very idea of zoning strikes you as a problem? Or are you trying to call out the bad implementations which strangle urban prosperity in the US?
Perhaps that should change. Or at least it’s a reason to scrutinize and repeal laws that are used for price fixing.
> Are you saying the very idea of zoning strikes you as a problem? Or are you trying to call out the bad implementations which strangle urban prosperity in the US?
Zoning Rules! by William Fischel gives good a history of zoning. Zoning was originally for segregation within the city but to the question of prices, no it was not inherently problematic. It was not until the 1970s that zoning was used for growth control to make entire cities unaffordable.
In the case of Uber, they successfully broke up the taxi cartel since the state PUC ruled that ride hail is a separate category.
In the case of Airbnb, according to their founding story they were created to help economize on space because rents were high in San Francisco due to zoning. Although they made a useful service, they did not succeed in reducing rents because the underlying zoning is still the constraint that keeps rents high.
And the government can establish monopolies on many things, my private nuclear weapons startup did not get much traction either.
As an example in support of this, healthcare is barely price-regulated and hardly run by the government in America, and is thus extortionate.
They are supply-regulated by governments. According to Niskanen Center, the high cost of health care is due to the American Medical Association limiting new accredited medical schools and certificate-of-need laws limiting new hospitals. https://www.niskanencenter.org/faster_fairer/liberating_the_...
Barf. These seem like very erudite reasons when really the issue is running healthcare as a balkanized private system with opaque pricing information that patients often don't see until after they receive care is fundamentally an inefficient system. The government could run a single payer system at a loss and it would be cheaper than what we have now.
I don't know about Uber, but Airbnb deflects this by saying they are not in fact a hotel service. Rather hosts are hotel services, and Airbnb is simply a discovery platform matching buyers and sellers. It's up to an individual host to make sure they are complying with local laws including whether their city or district allows an individual to rent out their house or a room in it without a hotel license (this varies from city to city). In this way Airbnb (fairly or unfairly) pushes the burden and liability onto the hosts.
I believe this is also a huge reason why Uber doesn't want to classify drivers as employees because then it is the taxi service, whereas it could argue that the drivers are each operating their own taxi service and Uber is just a discovery and payment platform.
If hotel or taxi lobby was more powerful or caught the threat early on AirBnB and Uber would have been destroyed.
airbnb had a much more legally tenuous start
This feels like one of those things where VCs (including YC and A16z) force this nonsense on their other startups in a circle-jerk sort of pyramid scheme fashion. There is no universe where this makes sense as a product.
collusion in another name if you ask me.
High-Tech Employee Antitrust Litigation is a 2010 United States Department of Justice (DOJ) antitrust action and a 2013 civil class action against several Silicon Valley companies for alleged "no cold call" agreements which restrained the recruitment of high-tech employees.
<https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...>
Companies assume they don't need your approval to collect data on salary range for your position as aggregates are not directly pointing at you.
Surely they are aware of the similarities and are strategizing.
This thread is getting removed from the front-page in 3... 2...
Note: we still moderate such threads. We just do it less than we otherwise would.
@dang, can you comment on that? I appreciate your integrity.
p.s. @dang is a no-op - I only saw this thread because I was doing our standard review of the flamewar detector. If you want guaranteed* message delivery, [email protected] is the only way.
* Well, mostly guaranteed. I assume there are a few that fail to get noticed in the spam bin, though we check that pretty carefully.
Annually HN sees about 150k active users, 400k stories, and 4m comments:
<https://whaly.io/posts/hacker-news-2021-retrospective> (2021 retrespective by Whaly.io).
It has one public-facing moderator (and apparently a few others who don't post publicly on the site). HN's own mods see very little of the total site content. Automation and member votes, flags, and vouches, as well as emails to the mods, are what keep HN humming. Not perfectly, but quite frankly one of the better-run online discussion sites, and one whose quality has remained remarkably steady over nearly 20 years.
If you see something you think isn't right (bad content not flagged, good content flagged, whatever, email the mods, and they'll take a look. I do this a lot myself, usually with positive results.
I disagree wholeheartedly with this.
> I don't see what the big deal is
Pick one... If there is no big deal, why would they want to keep the database secret? Also, do you have any source on that?
And the end of the ZIRP-driven shortage is telling us that what we used to make is not locked in forever.