December 7, 2017
This week Buffer, the social media management platform, reaffirmed their dedication to being a transparent organization and along with it fully public salary information on every employee. While this in itself is not news, the company has shared their salary details for the past four years, Buffer updated the salary calculation formula with a specific focus on being remote-first. In a blog post from Buffer’s finance team, they stated that their previous salary formula was over complicated.
“Over the past four years, a primary challenge was keeping up with pay benchmarks across a vast number of locations. It was complicated to explain how the formula worked to existing team members receiving promotions as well as new team members. With this level of complication, subjective decisions were made which put us further away from the intent of the formula.”
In an effort to simplify their transparent salaries, they benchmarked everything against a cities cost of living. In turn, they came up with the following formula.
The new Buffer Benchmark formula replaces one that included two other elements that they dubbed the Good Life Curve, which in place of location, it included elements of loyalty and the choice of more salary or stock options. Now, Buffer’s salary is based also on the location benchmark and grouped as high, average, or low cost of living. In their announcement blog post they also stated that they “use data from Numbeo to figure out which band applies for each teammate. For high cost of living areas we pay 100 percent of the San Francisco 50th percentile, average is 85 percent, and low is 75 percent.”
Not only did Buffer put each employee’s salary on display, they also updated their salary calculator that allows prospective employees to know specifically what they could make at the company. After tossing in my information as a seasoned content marketer in a city with a low cost of living, their salary mapped up pretty closely, if not a bit higher, than my expectations.
A few years back we spoke with Joel regarding the challenges that come along with remote teams, and even at that time Buffer was dedicated to the distributed model.
”There needs to be no advantage to being in the office, and no disadvantage to being out of the office,” said Gascoigne. “We see Hipchat as our office instead.“
With new feedback rolling in, Joel was quick to draw a line in the sand regarding what their employee salaries mean to him and Buffer.
An actual comment from Hacker News discussion on salaries (related to our news today):
“Salaries are the lowest amount the company thinks it can pay you”
What a sad view of the world. Do many companies truly operate this way? Definitely not how I run or ever plan to run Buffer.
— Joel Gascoigne (@joelgascoigne) December 6, 2017
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