The top 1% and the one to twelve ratio...

kiffer

Alternating Current wrote: »

Yes I agree, and we should also harness self interest so it benefits society. Ie let entrepreneurs earn as much as they want as it creates jobs.

Does it though?
Entrepeneurs will earn as much as they can for themselves with as few employees as they can...
Why hire 10 people when you can higher 8, promise them the moon and the stars, get over work them till they burn out and then hire some replacements?

Bubbaclaus

There is a significant lack of entrepreneurs in Ireland as it is, yet people want to disincentivize entrepreneurship even more.

Remarkable.

Buzz Killington the third

alb wrote: »

Bitcoin doesn't have shares, it's not a company.

Bit coin is just a bunch of number with zero real value because it doesn't physically exist.

jackofalltrades

KahBoom wrote: »

If the CEO wants the great privilege of being able to own a company and have that benefit from limited liability - a privilege granted to him by the public and government, since you don't just 'create' a company from nothing, their structure/workings are laid down in law - then he can follow whatever other rules the public/government lay down, in exchange for that privilege (including a salary cap).

Without limited liability a public limited company going into bankruptcy would be a legal nightmare.
Could you imagine creditors taking millions of owners to court to recoup debts.

Owners of private limited companies often have to give personal guarantees.
Also with limited liability comes responsibilities, eg. providing account information that's freely available.

No Pants

Buzz Killington the third wrote: »

It's something they're talking about on Newstalk at the moment. The idea is that within a company, the top earner can not earn more in a month than the lowest paid worker earns in a year.

I think it's something that should be enforced and would work well in the Civil/Public service but in a private company I think limiting wages is just wrong. When someone starts a company, why should they not benefit from it?

What research have you done to support your view? I don't mean personal research, but have you ready anything on this topic previously?

Buzz Killington the third

No Pants wrote: »

What research have you done to support your view? I don't mean personal research, but have you ready anything on this topic previously?

Do I need research to support my view? It's an opinion, why should I need research of any sort to back it up? Should I need research to show why I like blue more than green?

Jawgap

Buzz Killington the third wrote: »

.........

I think it's something that should be enforced and would work well in the Civil/Public service but in a private company I think limiting wages is just wrong. When someone starts a company, why should they not benefit from it?

........as public sector worker I think it would work very well........it would have made my decision to jump ship a lot more straightforward......

Believe or not people will go where the money is. At the moment I'm in the process of working down my notice before taking up a job in the private sector.

So yes, it's a good idea in the public sector.........if you want to limit the talent pool from which the PS draws.

seamus

Tiddlypeeps wrote: »

There is also the fact that this is totally unworkable. There is nothing stopping a company offering other perks as compensation to make up for the reduction due to regulation, at the very least they can be offered shares which will pay out dividends each year based on profits. It's totally unenforceable.

This. People on large salaries rarely take the entire salary directly as cash and instead funnel it straight into pensions, shares, investments, etc.
Put any kind of 12x restrictions in place and these salaries will simply be divested differently by the company so they don't show up as direct income for the director.

Anyway, the idea here isn't to limit the salaries of those at the top.

Because if you do this, what will happen is that accountants and companies will get really good at figuring out how to pay big salaries without actually paying big salaries. So good in fact that the salaries of their directors will drop on paper, and they will use this to justify dropping the wages of their poorest-paid employees.

The aim here should be to improve the salaries of those at the bottom. It comes from the increasing problem in the United States primarily where employees at the bottom of mega-corporations like McDonalds and Walmart have to rely on state intervention or second jobs just to achieve a basic living income.

Really what we should be looking at is requiring employers to benchmark their employee's salaries on a yearly basis, not against the market, but against the local economy. Based on various pieces of information like the location of the office, the average length of the commute, the location of employees, availability of subsidised lunches, whether health insurance is provided, etc, it should be possible to baseline a minimum living wage, below which a company is not permitted to pay its employees.
This could also have a knock-on effect of companies seeking to reduce their wage bill by including BIK like health insurance, subsidised rent, gym, etc etc.

Akrasia

Bubbaclaus wrote: »

There is a significant lack of entrepreneurs in Ireland as it is, yet people want to disincentivize entrepreneurship even more.

Remarkable.

Ireland is one of the easiest places in the world to start a business and there is a lack of entrapreneurship
(we're ranked 15 in the world in the ease of doing business rating http://data.worldbank.org/indicator/IC.BUS.EASE.XQ)

Obviously there is something wrong with the existing system that is discouraging entrapreneurs in Ireland.

99% of potential entrapreneurs (or actors, or sports people, or potential doctors or any other category of person) would not be put off by the prospect of being able to earn 'only' 480k' a year.

The highest paid people are not entrapreneurs.

Jawgap

Akrasia wrote: »

Ireland is one of the easiest places in the world to start a business and there is a lack of entrapreneurship
(we're ranked 15 in the world in the ease of doing business rating http://data.worldbank.org/indicator/IC.BUS.EASE.XQ)

Obviously there is something wrong with the existing system that is discouraging entrapreneurs in Ireland.

99% of potential entrapreneurs (or actors, or sports people, or potential doctors or any other category of person) would not be put off by the prospect of being able to earn 'only' 480k' a year.

The highest paid people are not entrapreneurs.

Seriously?

Don't mind surveys - have a look at the actual process involved in setting up a business here - it's ridiculously wasteful. You've to provide the same info over and over again to a range of bodies, the bureaucracy is impenetrable and unless you're Apple or Google, the practical help available is minimal.

No Pants

Buzz Killington the third wrote: »

Do I need research to support my view? It's an opinion, why should I need research of any sort to back it up? Should I need research to show why I like blue more than green?

Blue or green is a personal choice. Deciding on whether or not you support a legislative proposal should be based on something more.

Akrasia

Jawgap wrote: »

Seriously?

Don't mind surveys - have a look at the actual process involved in setting up a business here - it's ridiculously wasteful. You've to provide the same info over and over again to a range of bodies, the bureaucracy is impenetrable and unless you're Apple or Google, the practical help available is minimal.

Now you're joking.
Setting up a business is very easy in Ireland.

There are also multiple grants and assistance programs. If you're uncertain, you can go into the local county enterprise board of local development company and someone will fill in all the forms for you.

It would be hard to imagine a system that is easier yet still functions within a modern legal framework.

Buzz Killington the third

No Pants wrote: »

Blue or green is a personal choice. Deciding on whether or not you support a legislative proposal should be based on something more.

Calculating a 12-1 ratio for salary in PS jobs would still leave the top of the chain on enormous salaries you know. I actually don't think many at all would be affected by it. But it would limit the huge bonuses which are handed out.

folan

could be worse, could be more like the ratios here (from joe.ie).

seamus

Jawgap wrote: »

Seriously?

Don't mind surveys - have a look at the actual process involved in setting up a business here - it's ridiculously wasteful. You've to provide the same info over and over again to a range of bodies, the bureaucracy is impenetrable and unless you're Apple or Google, the practical help available is minimal.

To be fair, it's quite straightforward. You don't even have to register a business name or fill out any forms. I can start trading as "seamus's landscaping" tomorrow.

I think the main problem is that there are no supports in place to help get you over the initial barriers and no mats in place to catch you when you fail.

As a sole trader setting up a business, you get zero government assistance to purchase materials or rent a business premises. Your tax credits are half those of a PAYE worker, and you are excluded from claiming practically any personal income assistance from social welfare.
On top of that, if/when you begin to struggle and your business fails, you are locked out of claiming government assistance for quite a long time, and your entire asset portfolio is at risk.

So anyone looking at starting a new business in Ireland - especially those with the industry experience to do so - will see a massive yawning chasm into which they could easily fall and lose everything, and be left there to die by the state. So they stay put on the gravy train as a PAYE employee.
My brother worked as a sole trader for about ten years before moving into a PAYE role. About two weeks into it he said, "Paid holidays, less tax, evenings and weekends off, no equipment costs - lads, I was a mug for ever working for myself".
Obviously we need to prevent individual people setting up tonnes of crappy businesses, but at the same time there needs to be supports in place to encourage those with the skills to give it a go.

No Pants

Buzz Killington the third wrote: »

Calculating a 12-1 ratio for salary in PS jobs would still leave the top of the chain on enormous salaries you know. I actually don't think many at all would be affected by it. But it would limit the huge bonuses which are handed out.

1:12 still means that the CEO makes the same in the month as the lowest paid makes in a year. It's about fairness, both within the company and society.

Jawgap

Akrasia wrote: »

Now you're joking.
Setting up a business is very easy in Ireland.

There are also multiple grants and assistance programs. If you're uncertain, you can go into the local county enterprise board of local development company and someone will fill in all the forms for you.

It would be hard to imagine a system that is easier yet still functions within a modern legal framework.

Have you set up a business here?

Because that is certainly not my experience.

I think at the last count a small manufacturing business I was involved with was dealing with nearly 20 different state agencies.

........then there's the business rates.....

Buzz Killington the third

No Pants wrote: »

1:12 still means that the CEO makes the same in the month as the lowest paid makes in a year. It's about fairness, both within the company and society.

So what? They're the CEO, not a secretary! I don't buy the "fairness" argument at all. Is it fair that while most of us work, there's a very large portion of society that scrounge off the state?

oppenheimer1

Buzz Killington the third wrote: »

It's something they're talking about on Newstalk at the moment. The idea is that within a company, the top earner can not earn more in a month than the lowest paid worker earns in a year.

I think it's something that should be enforced and would work well in the Civil/Public service but in a private company I think limiting wages is just wrong. When someone starts a company, why should they not benefit from it?

The lowest wages in the public service are about 22k for an entry level clerk. Almost no one in the public service earns more than 12 times that.

Jawgap

seamus wrote: »

To be fair, it's quite straightforward. You don't even have to register a business name or fill out any forms. I can start trading as "seamus's landscaping" tomorrow.

......

Perhaps setting up service based business is straightforward enough - but if there are tangible goods involved, especially coming in and going out of the country it's orders of magnitude more complicated.

And it's not even that you have to deal with so many organisations - what's frustrating is that their requirements are often diametrically opposed! Even within the same organisation - you get one division telling you to do one thing, then another comes along and warns you not to!

Tiddlypeeps

No Pants wrote: »

1:12 still means that the CEO makes the same in the month as the lowest paid makes in a year. It's about fairness, both within the company and society.

That would only be unfair if the lowest paid worked full time hours for a rate that can not provide them with the basics needed to get by. If the lowest paid are in no way being exploited then where is the unfairness?

This does not exist in Ireland, it's just a cliche that people have latched onto for some reason.

What anybody else in a company earns should be totally irrelevant as long as everyone working for the company is provided with a reasonable standard of living from their wages.

SligoQueries

Frynge wrote: »

I bought a brand new car last year that was not cheap.

From the money in the safe?

No Pants

Buzz Killington the third wrote: »

So what? They're the CEO, not a secretary! I don't buy the "fairness" argument at all. Is it fair that while most of us work, there's a very large portion of society that scrounge off the state?

Studies show that it causes resentment and morale problems, which cost the company. Seeing as the CEO is responsible for the company to the owners, that should be a concern.

There's nothing wrong with a CEO earning more than a secretary. However, there is a problem when the pay ratio reaches 273:1, 354:1 or even 1,795:1. At that point, it becomes a threat to democracy.

Buzz Killington the third

No Pants wrote: »

Studies show that it causes resentment and morale problems, which cost the company. Seeing as the CEO is responsible for the company to the owners, that should be a concern.

There's nothing wrong with a CEO earning more than a secretary. However, there is a problem when the pay ratio reaches 273:1, 354:1 or even 1,795:1. At that point, it becomes a threat to democracy.

Better call Team America... :rolleyes:

shruikan2553

No Pants wrote: »

Studies show that it causes resentment and morale problems, which cost the company. Seeing as the CEO is responsible for the company to the owners, that should be a concern.

There's nothing wrong with a CEO earning more than a secretary. However, there is a problem when the pay ratio reaches 273:1, 354:1 or even 1,795:1. At that point, it becomes a threat to democracy.

If I start a business will the state create legislation in order to make it as profitable as possible?

It seems like the issue is with people who have a lot of money bribing polititions, I recommended looking into preventing that before you worry about what people earn.

No Pants

Buzz Killington the third wrote: »

Better call Team America... :rolleyes:

I don't think that's necessary. The numbers I quoted are from the US, so they're well aware of them and the problems they cause. However, nothing is likely to change any time soon.

Dyr

Bubbaclaus wrote: »

There is a significant lack of entrepreneurs in Ireland as it is, yet people want to disincentivize entrepreneurship even more.

Remarkable.

http://businessetc.thejournal.ie/ireland-most-entrepreneurial-country-in-europe-1533477-Jun2014/

Now stop posting for christs sake, it's like you paid sean gallagher to coach you in having opinions.

Dan_Solo

How entertaining that it's the same people who want the public service to be run more like the private sector are those who are saying pay ratios are great for the public service but would never work in the private sector...

Iwasfrozen

No Pants wrote: »

There's nothing wrong with a CEO earning more than a secretary. However, there is a problem when the pay ratio reaches 273:1, 354:1 or even 1,795:1. At that point, it becomes a threat to democracy.

People are paid what they're worth to the company.

I'd love to see you provide an example of these outlandish figures btw.

steddyeddy

Celly Smunt wrote: »

No.You pay the best to get the best.


The less meddling by governments in the private sector the better.

You don't believe this cliché do you?