Swiss capping ratio of CEO/peon pay

[Greenday]

Since McDonalds are being dicks lately, lets take a look at them. Last year their CEO received 13.8 million dollars in compensation. This was a raise of 237% over the year before. Furthermore, he only became CEO in 2011. Have you ever received a 237% raise after 1 year at your job?

No I haven't. But then again, no company under my command has increased net revenue over $1 billion in just five years.

[Andara Bledin]

Here's a question. How would salary caps affect the highly specialized fields such as, say, medicine?

Should a doctor who is only one of a handful of people in the entire world be forced to work for a maximum of $200/hour because the hospital only pays the guy loading the laundry into the machines $10/hour?

[s_stabeler]

Andara, this IS CEO pay that is capped. Also, to be honest? considering that over a year that translates into $384,000? then yes, I WOULD say the doctor should have their salary limited. However, I will point out that in practice, doctors who have skills that rare normally have their own practices, and therefore come under independant contractors, who are obviously exempt.

[Greenday]

Andara, this IS CEO pay that is capped. Also, to be honest? considering that over a year that translates into $384,000? then yes, I WOULD say the doctor should have their salary limited. However, I will point out that in practice, doctors who have skills that rare normally have their own practices, and therefore come under independant contractors, who are obviously exempt.

So that's how we'll do it? The only people not allowed to make tons of money for what they do are CEOs. Everyone else who is important can just be "contractors" and that'll be the loophole!

[Gravekeeper]

No I haven't. But then again, no company under my command has increased net revenue over $1 billion in just five years.

I assume you mean net profit. Net revenue is a somewhat different beast. Also, McDonald's current CEO has only been the CEO for 1 year. Not 5. If you're referring to the previous guy, he did increase net revenue by stopping McDonald's constant location expansion ( which was causing them falling profits to begin with ) and closing less profitable locations in favour of improving existing locations ( Thus likewise reducing operating costs ). But this was a few years ago ( 2004 to 2008 ). However, he was CEO for something like 4 decades. So both the rise and fall happened under his watch.

Meanwhile, McDonalds is falling under the new guy and relations with its own franchise owners are a historical low due to his strategies ( Which are passing profit loss onto the franchises through constant discounts and coupons ). Despite this, the new guy actually gets paid MORE than the last guy.

Finally, awarding all the credit to the dude at the top who gave the order instead of the hundreds of thousands of employees underneath him that carried it out is pretty stupid. You don't aware the General all of the medals his troops earn.

[Gravekeeper]

So that's how we'll do it? The only people not allowed to make tons of money for what they do are CEOs. Everyone else who is important can just be "contractors" and that'll be the loophole!

Show me a doctor that makes 10 million a year practicing medicine. -.-

Or are you going to say that the financial worth of a position is based solely on how much money you make for shareholders. Instead of its real world use and required skill set? The President makes $550,000 a year when you include the perks like the expense account and what not. Is the President less important than the dude that runs McDonalds?

Even the worst CEOs make millions despite running companies into the ground.

[Greenday]

You don't aware the General all of the medals his troops earn.

No but you promote officers for the good work the troops under him do.

[s_stabeler]

So that's how we'll do it? The only people not allowed to make tons of money for what they do are CEOs. Everyone else who is important can just be "contractors" and that'll be the loophole!

no- just that a contractor's wages aren't dependent on the wages of the lowest person on the totem pole in the company they are contracted to.

also, I am NOT saying that a CEO cannot be rewarded for doing his job well. I AM, however, saying that a CEO earning thousands of times the salary of frontline employees is excessive. Note, by the way, that the proposed limit means the CEOs can still earn almost as much as the President. Companies complain all the time about payroll being too high. Well, maybe cutting the CEO's salary would help. Who knows, maybe then McDonalds could pay it's employees a living wage instead of advising them to sell their posessons on eBay to pay the bills.

[Andara Bledin]

I, quite honestly, don't care if the guy at the top makes stupid mad money for being at the top, provided that the people at the bottom are being treated decently.

Currently, in the US at least, this is very much not the case. Which is why the inequity is so prone to lead to unrest.

[Duelist925]

I, quite honestly, don't care if the guy at the top makes stupid mad money for being at the top, provided that the people at the bottom are being treated decently.

Currently, in the US at least, this is very much not the case. Which is why the inequity is so prone to lead to unrest.

I rather do, because it seems that the people at top are fundamentally incapable of treating the people at the bottom fairly.

So something like this, which directly ties their prosperity to the prosperity of the people at the bottom, is a good idea.

[mikoyan29]

If the boards of companies would stop being the incestuous breeding grounds that they currently are and start looking out for the health of their companies, this situation would fix itself in no time. I mean right now, you have CEOs serving on several boards and you get the "You wash my back, I'll wash yours" cycle that is currently happening. But instead, you have people buying companies sucking out any cash and leaving the rotting hulk for someone else to deal with.

And while on the subject of CEO pay...I still don't have problem with the founder of a company making gobs of cash if it becomes a success.

[Mytical]

Ok here is the way I see it. I don't think people will argue that a GOOD CEO is a bad thing, and that they should only make as much as his/her employees. However, here is something to consider. A CEO is nothing if the business makes no money. Front Line employees are the backbone of MOST of sales. You need a few things to make a good, healthy place to work.

1) Healthy and happy employees.

For this, they need to make enough so that they do not have to choose between missing a day of work AND paying medical bills and not having any food. Enough people that the work load does not break down your employees. Now I know 'there are always more to replace the ones that 'break down'' but you are forgetting training time when mistakes will be made, more turnover will occur, and such.

2) A good public image. Which comes from the 'faces' of a business. Guess who are the people that customers see more...the CEO or the front line employees?

3) A good support structure. To help employees to recover if something goes wrong (see 1).

4) And finally good management. Which means a good CEO or president/ etc. So yes they should make a good salary to draw good CEOs.

However, when employees are happy and healthy they will work harder for the company. Note : IF they are lazy, they should be tossed without ceremony. However, they should also not have a million things to do so they 'break down' quick because of being over worked.

[Andara Bledin]

However, they should also not have a million things to do so they 'break down' quick because of being over worked.

It costs more to keep training new people and getting them up to speed because of high burnout and turnover than to just hire two people for the job, pay them enough to live on, and keep them for the next decade.

[AccountingDrone]

It costs more to keep training new people and getting them up to speed because of high burnout and turnover than to just hire two people for the job, pay them enough to live on, and keep them for the next decade.

Actually, go back to the old style work a full week, get a medical plan, have a bonus plan, a rate of planned raises but link it to the cost of living increases, plus a time in job raise and a living wage. Go back to regularized schedules [so you always know your schedule and can make plans for vacations, medical appointments and so forth] and a reasonable vacation schedule, and sick days that you can take without penalty. [I would love to see 4 - 5 day weeks of vacation, and 1 5 day week of sick days - it would decrease employee stress to be able to actually take days off to destress and still have 5 days of oh shit, I am puking my guts out sick days.]

I can remember hearing my Dad discuss a no shit job contract with my Mom, I was 9ish so it would have been in 1970 - it was for 7 years and specified pay, vacation, a bonus plan, a med plan, a retirement plan. Granted he was management, but I ended up working for the same company 5 years later and the employees were treated fairly and humanely. We got living wage, medical and retirement. We got 2 weeks vacation and 1 week sick after 90 days. We were given a turkey at Thanksgiving and Christmas, a ham at Easter and there was a big all-company and family BBQ picnic for the 4th of July.

Why should anybody be treated with any less consideration? Everybody tended to work their asses off for the company, and we knew that we were being taken care of by the company.

[HYHYBT]

A minor point, but I have to bring McOpCo up. For McDonald's, and very likely for most other similar franchise arrangements, the corporation itself owns and runs a significant fraction of its outlets directly. So it doesn't matter so much how you count the franchisees.