CEO pay should be a % of total employee compensation. Want to earn more? Gotta raise pay or benefits for all other employees. Need to lay people off? Do what you need to do but you made the pie smaller so your compensation goes down.
This is actually supported in the scientific literature as we know that once the pay disparity between leaders and employees goes over a certain threshold it starts to decrease basically everything for employees from wellbeing to basic productivity (I know the citation but not home and lazy to send it). Problem is most organizations don’t actually really want to make good effective workplaces that are good for everyone as they only want to benefit the people on top in the short term.
CEO pay should be a % of total employee compensation. Want to earn more? Gotta raise pay or benefits for all other employees. Need to lay people off? Do what you need to do but you made the pie smaller so your compensation goes down.
This is actually supported in the scientific literature as we know that once the pay disparity between leaders and employees goes over a certain threshold it starts to decrease basically everything for employees from wellbeing to basic productivity (I know the citation but not home and lazy to send it). Problem is most organizations don’t actually really want to make good effective workplaces that are good for everyone as they only want to benefit the people on top in the short term.
Do you know the ballpark of the disparity threshold where this becomes detrimental?