Updating rates to pay people

#1

We discussed and established the first version of our rates table. It was the first iteration and seems to work very well. I haven’t heard of any complaints. But over time the living costs increase (inflation) and I propose to update our rates regularly to pay the same value over time.

We already had one developer in Porto asking for a rate update which we agreed to. I think we just moved them to a different category in the table.

In Australia, we measure the inflation based on the Consumer Price Index (CPI) calculated by the Australian Bureau of Statistics. In the last years it has been between 1.25% and 2.55%. This number will be different for each country. My best idea is to have a rate for each location and apply the local inflation rate on a yearly basis.

When we discussed our rates initially, we acknowledged that they are far below market rates for developers. We can discuss increasing them as well. But that is a different topic and should include paying non-developers and if we should have the same rate for all roles.

For now, what is your idea of keeping our rates table up-to-date?

#2

I think that is reasonable but IMO I’d first focus on getting more people paid than adjusting rates to CPI for now. That being said, at Coopdevs we are ok with the current rate.

#3

Theoretically I agree with keeping in line with inflation. Maybe you are right @maikel that the best bet is to have individual countries priced differently. However this goes against the concept of global dev rates that we originally agreed. Once we move to individual country wage rates it makes more sense to base pay on cost of living rather than flat rates. And then we enter a marketplace in which developers are better value in India than in London. Slippery slope.

I’m going to put my economist hat on for a moment… If our pay is pegged to the Euro then we can safely assume (for now) that we won’t see spiralling inflation in the currency. The global standard for central reserves in developed countries is to aim to keep inflation at 2%. As our rates of pay are not well tied to cost of living it doesn’t make a huge amount of sense to start to tie wages to CPIs for individual countries/regions. I would suggest we sit at an annual pay increase of 2% in line with target inflation.

Though more fundamentally I agree with Pau that while our budgets are so insecure it is hard worry about inflation.

#4

We do consider cost of living, just not as detailed as per country. We have three cost-of-living categories.

I agree that if the inflation is roughly 2% across our countries then we don’t need rates per country. We can just increase by 2%.

I also agree that not paying people for their work is a bigger problem. @sauloperez would you like to open a topic to start that discussion?

#5

I understand your point @maikel but would like to clarify, Luis situation was not that he asked a wage increase, he just became RI, which was just fair.
We can open as many discussions as we want, but for now we just don’t have the money to pay everyone, and this project will just not exist anymore if people were not working without being paid from the very beginning. With the current situation, anyway in 4 months we won’t be able to pay all the people currently being paid, so before talking about increasing wage, I would suggest we focus first on just being able to continue paying the people. Then see if we can start paying the people creating value that are not paid today. Then I would consider increasing wages…
So I agree technically that people being paid “loose” a little bit of purchasing power locally as their wage doesn’t follow the inflation, but I see a bit that as a solidarity principle, how do we share the cake that we have today, which is not yet big enough to pay everyone…

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#6

I agree with the sentiment that it’s a good idea in theory but that given current financial constraints, then rather than 1-2% more to developers I’d like to see money go to more of the product train roles. Our gender split is still very noticeable across these roles, and while 1-2% to stay closer to market wages is understandable I can’t feel good about prioritising that while we still have a number of people - often (but not always) women - who are being paid 100% less than their market wage!

When we do get to considering inflation, it seems complicated to administrate on a per-country basis.

I find the country/city living wage split understandable but also challenging. I moved to the country to decrease my cost of living so that I could work towards being able to do only this type of work rather than having to balance with better paid work that cross-subsidises participation in this type of semi-paid, semi-volunteer work for good (but the cross-subsidising work also then drains energy away from it making the equation less effective), but then by doing so it is immediately meant to get harder to cover those costs because my wage goes down. Similarly, what happens when a higher waged developer moves to a cheaper country - are we keeping track of that? Do we really want to?

I also think there is a difference between casual and secure work, so where I feel comfortable charging a higher amount for insecure casual work (the going rate in Australia is a 25% loading for casual work), I don’t feel comfortable doing so when there’s more security to it, at which point it seems like it should be less (although usually then leave would also be covered).

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#7

I’m in 100% agreement with everything @Jen said.

I would love it if we could increase rates inline with 2% forecast inflation each year. I would also love to be paid for what I do on the project. And to pay everyone else who is doing it voluntarily. I would also love to have secure funding that would allow for this lined up so that we can do both the above things.

Alas, we’re not there yet. So, talking about paying more to those already being paid out of an increasingly shrinking bucket that isn’t paying everyone doesn’t seem like the biggest problem to solve right now. Unfortunately.