WWL>Topics>>3-13-14 1:10pm Angela: on salaries

3-13-14 1:10pm Angela: on salaries

Mar 13, 2014|

Angela talks with Mark Ehrnstein of Whole Foods and Merry Peckham of Benefit Administration Group about the pros and cons of knowing what your co-workers salaries are.

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Automatically Generated Transcript (may not be 100% accurate)

Well it's a nice to be back a little bit under the weather but feeling a 1000% better and how could you not on the day like this it is gorgeous. Absolutely gorgeous. One thing -- mr. wonderful for filling in and he always has such a terrific job but we -- back and I think we have three. Hopefully very interesting programs and I'm an attorney about our first one in the second but. Our second hour is going to be an hour with Dennis launcher who is the president not only of the saints but also of the pelicans. And he's sort of a quiet man in the in the background. But he is very much any life force within those organizations that there's anything you'd like to talk about I'm sure he'd love to hear from. So don't hesitate to give us a call. And then our third our very important on Saturday when you go to the polls you're gonna be electing various people which are also going to be deciding. Whether the -- institute is going to be able to continue its Milledge. And it's become kind of controversial a Ron Foreman is going to be here he's president of the Ottoman institute. And down your thoughts both pro and con would love to hear from me on that. But our first hour. How would you feel if your employer made everyone's salaries public from the CEO on down. Do you want to know what your office mate makes. More importantly do you mind if he -- she knows what you make. It's an interesting question. But it's the rule that the Whole Foods Market. CEO. -- coast CEO John MacKey says the transparency. Of salaries. Can empower and motivate workers. Whole Foods Market has been named one of the best 100 places to work in America for the last fifteen years. And John McKay has been named best CEO in America. And most inspiring CEO. What are they seeing that perhaps other companies may not state. And what do you think. Do you think salaries should be private or public. Love to know your thoughts on that 260187. Well joining us to talk about this is Mark Bernstein who is the executive director. Of the team members services at whole foods and mark I truly appreciate you joining us. Well it's my pleasure thanks so much for having me. I just wanted to clarify that as director of team members services that you are essentially human resources. That's correct yes. Very good let's talk about what -- and your CEO. When -- institute dispersed. Of past the -- disclosure reporters in place for over 25 years this is an integral part of our culture manner. Practices around compensation so it's been around for quite awhile. And generally what has the you know the reaction. Of employees then. You know the reaction -- only positive. Our team members. Like it. We make it clear Turkey members and it's available to them as they'd like to see it and any time it. Questions about anybody's compensation in the company they can get a direct answer and look at the which disclosure report and understand what others make so it's exactly it's been nothing but positive. Kind of go over what's been the philosophy was 25 years ago and creating. That decision of opening them. Sure words of philosophy that. Really connects to a lot of our our key member practices and that's around transparency. We want our team members do you have a direct line of sight and so many things about the business and compensation is one of those so. You know if if if I'm well I am a team member as well as a leader in the company that. If I have questions about what anybody else makes relatives my compensation whether it's related to -- Robert you were from applying for promotion. I can look at the -- disclosure report and -- Clear concrete information about. Maybe the next job that I might have India company. I know that to mr. McCain once commented that. Occasionally employees have questioned him about one why is one -- more than another for similar position in his answer always is. I am quoting that that person is more valuable. But -- the person who's asking his feeling just as valuable. Hour in some cases even more valuable. It doesn't make it awkward. Well. You know -- hear that question and I I think that the the reality is that there are people on the company to have a greater scope and scale of responsibility. With respect to the job -- to -- in the whole foods are frankly in any other companies so. I think John cancers as fair answer is that there are people on the company who have simply have more responsibility than others and because of that they're compensated differently. I guess when am I think I may have looked at that wrong because I was thinking. Apples to apples if there are I'm a singer to have you that if there within that the structure of your organization as I know how many sourced you have now. Now we have over 375. Doors on the couch now so grateful for the ones in New Orleans let me -- thank you should have total absolutely. Just opened the second month thrilled to death. Thanks so much but anyway you. Let's say. This would be equivalent to cashier to cashier to mounds produce manager to produce manager. Right some can vary. Even though there in the same position. Rights right ice futures -- -- And and and that that's not to say that's where the -- disclosure report is so helpful and I think great for team members because. Again if comic cashier in the store and I look at the -- disclosure report and I see them my peers -- earning more than me or some might behind last. I can go to my team owners say today. I understand that. 80% of the folks on the team Gordon in the same job I'm doing are getting paid more than I am and I'd like to understand why and I can create an open dialogue around compensation. And also around performance. Because there may be some really good reasons that that person is being paid less and others on the team and it may have to do -- ten year it may have to do with performance or other factors that that person might not be aware of. That was -- my questions and tenure is an issue. Seniority isn't issue. Well seniority is an issue with respect to performance people in the world with the company for a longer period of time tend to get better at their jobs and you know we're we're America based. Company we we based compensation on on. Performance. Not necessarily tenure but tenure is absolutely related to performance. So if you know after several years and they're performance isn't good enough one would assume they're not there. Yes that's a pair first option and in many cases now. Dude you have annual outperformance greeting her. We do and we call those -- dialogues and the intention is that. You know country to it that typical sovereignty which can be a one sided conversation. Our our hope is that it's two way dialogue between. A team member and a team leader that. It's kind of maturing up process wearable -- an opportunity to talk about that person's performance and true up any differences in perspectives about performance. We'll please stay with -- mark and I hope our callers will as well we're gonna continue this conversation on the issue. Of should George salary be private or is it okay to be public and were talking to the man who is I guess head of -- and I'm gonna say it right. Director of team member services at whole foods and it was whole foods co CEO who came up with this concept stay with us we'll be right back. Will we are back and were talking with Mark Bernstein who is the global vice president and executive director of team member services of whole foods. And were asking the question do you feel comfortable if your salary were made public that has been the philosophy of whole foods for 25 years. And apparently according to mark -- working beautifully. And I think it's very much worth noting that whole foods has been voted. One of the best 100 places to work in America. For the last fifteen years and the -- CEO John McCain was named one of the best CEOs in America. That said at night walk around the building and I asked people what do you think they have sort of this panicked look in the their eyes so I think it's sort of a concept that we would have to really learn took to get to know. But we are also joined now by Mary pat them who is a -- a consultant with the benefit administration. Group and which helps people with HR issues and delighted to have you as well. Mark come and go back with you first of all. Again establishing that this has been a long term decision by your company you find that it works beautifully and that the employees. Are. Are motivated in a sense when they know somebody else is making it a certain amount and they're not. Yes yes we -- again and we feel strongly that this is a good program for us. You know it also ties enemy should mention too that we. We we also have a salary cap that we think. You know helps engender trust with our team members related to compensation. And enact -- basically means that there's no one person in the company you can learn. In base and bonus more than nineteen times the average hourly rate of today. And that includes our co CEOs will dot com makes the dollar a year but for any any other executive in the company it's -- -- nineteen times. You average earlier an apparent. And you know that's. In today's world when were seen such enormous salaries. -- by some -- -- CEO types. In relation to other workers is a pretty astounding statement. Right yeah the the multiplier is typically are in the hundreds and can easily reach 4500 times. For for a CEO. Fortune 500 company. Did read correctly that your average salary is around eighteen dollars and 89 cents -- is -- And so that would be again. From -- -- the lowest position hate it logos -- but it's important but the lowest position all the way to the CEO that's correct. That's still very high. Mary is -- rate that yes shaking her head and she did some very did not want to ask him well and -- -- Very interest in these years and about the job on specifically. And how do you how do you make that process work in both directions. Sure -- John dialogue is really great process and what we what we do is we ask our key members to. So loud a job ballot form so there's. Specific set of questions that are asked those key members. Regarding their performance and they break themselves and penicillin their -- of things the team leader will do the same. And then a -- and compare notes and talk about it and areas of difference in Tennessee and and again as I said earlier it's. You know for -- it's really trying to process an opportunity for team member of team leader to. Get on the same page and talk about how things are going for the the team members involved in the job now on. He has has anything ever come out of one of those dialogues it's alleged change in policy. That's a really great question I don't specifically know if it's -- job dialogue. It is. Caused a change in policy that aren't. Key members. Regularly provide us feedback with. With respect to things that sometimes change policy. Or practices and you know I remember one year old daughter. And the benefits plan -- well over ten years ago a team member had an idea about how to numbers could. Enroll in the plan when they became eligible and that changed the eligibility. Turkey members they became eligible smoker actually because of their proposal. Which also factored in the cost to the company so. Our team we have an open door -- members are. Very good about using it. Let me ask if somebody is having this dialogue I'm an employee and I really have sort of -- perception of how good I think 9 AM and yet the person I'm talking to visit different perception but how do you work that. Care well and that's where are open door really is important if if there is saying any significance difference in how things are seen regarding someone's performance. The key members -- to talk to any other leader in the company so they can talk to. If it's a team member and that department team leader the team member may -- and I. Really wanna talk further about this was with someone and store leadership. And and their free to do that and we we invite and welcome -- so that that's really is you know it's important when you have an open door policy to really honor and and two to stand by and and I think by and large we do a pretty good job but it. And you know I'm I'm also very interested to hear about how you. How you keep that performance review process consistent for me that's always been such a challenge. Sure and that that can be a challenge for us as well you know one of the I think things that really has helped us be successful as a company. There's the fact that we're very decentralized we have twelve distinct operating regions. And we have stores and in the US United Kingdom and Canada. And and so that is the challenge we like things to be consistent where we can be at times. We do see some -- in terms of how people conduct the process and we're always working hard to make sure that. Our key members are having it consistent experience. Whether they're working in the midwest region or in the United Kingdom. And -- what is the reaction of other. Big companies other big grocery stores and and other kinds of companies to this philosophy. Well we. You know we did not hurt other challenges to you know there's a lot of a lot of dialogue and in various circles around. Compensation and and -- disclosure and and you know it's just something we've been doing so long that it's it's an integral part of our culture. So we we stand by. You know I know that folks have a challenge with it. Other folks sometimes the you know I think it can be threatening. But we really believed transparency and and crimes like decipher two members. -- I've heard from very should only would be a nightmare. -- I've heard I've heard that -- and and I I. I you know I promise you for at least for it's not it's it's a really good thing. And I that's what if you know it works. It works you have a happy company you have people who want to work there you have a successful CEO if not too. And and and again I think everybody has to say for this organization. It's a great idea. Trying to apply it to another may or may not work. Right I think it could be challenging elsewhere but we sure believe that. Well I can't thank you enough for your time and it's it's just fascinating and tell your CE OMR McCain and I would love to interview him Mondale in his new book because I think he's right on target with where he's running on about. I'm definitely pass and on and it's been a pleasure chat chatting with you thanks so much. You so much I want everyone to stay with this because Mary is going to stay with us and we're going to be talking about all kinds of HR issues. But if you have any thoughts at all on should your salary be made public. Or kept private give us a call 260187. They were gonna be right back we're -- -- the newsroom now and -- college. You know it's just always very interesting to mean to learn something like that whole foods which is a tremendous operation. Both here in this city and throughout now we know the world in Canada and England. And -- started just in the last I think around forty years ago. But sort of a different philosophy and they just believe that based on not I'm sure this is just one element of their philosophy. That it is better to be transparent with people's salaries so everyone knows what everybody else makes. And it's just been an interesting thought. Again because the people I've talked to. Openly have -- But that's okay because -- it works differently for everybody. But we also now have Mary -- them who is sound and HR consultant with the benefit administrative group and I've appreciated for being here. And we're gonna continue on with other issues HR issues. And near what you really think about the the salary is in May work for them but it isn't for everybody that's right. And what you what you have to be careful and particularly when year. In HR is managing risk and often. When people. Just don't know what the person sitting next to them makes and it's very difficult to to prove that you know there's. Discrimination taking place and or it doesn't even jump into your mind however and it's well known that certain groups are rewarded in terms of salaries. On average less than other groups and when you do roll out a transparent process like that you needed done your homework on the front end to make sure that you don't have. Any discriminatory pay practices. Either at expressed or not expressed and the that's it's just something that hasn't we haven't really conduct -- We have a caller Walter from clinching. Yes when the property is pushing. For people who quit is suddenly in double -- -- -- that atmosphere. What is wrong but employees station managers across the desk and -- I know what's going alone I'm not going to quit. In -- you won't believe what all that it comes -- pay unemployment. Well you know I would say that the there's nothing wrong with that necessarily it's your right to have that conversation with your employer. However and it's probably best to you have that conversation. Traps in. Aways that acknowledges that there's dissatisfaction. On your side. In a calm manner that they. -- -- -- -- -- And this company in front works well it just just make individual local people put them quit. The settling a mall and been in that process and make things -- I think the person to you know sit across the deaths and go directly in -- matter. Because -- just like companies as -- push people around get adequate and with the unemployment but out her cases where people actually across America and one. Didn't separate package and get on I think people need more -- in pain management when he situation. That's that's certainly. That certainly the case a lot of times people don't ask for things that they could get if they discussed or. And it won't have a comment. If he didn't do we charm and in Texas I think you get unemployment and Social Security to go retard just immediately off. May I ask I'm just curious and don't give me the name of the company but to -- -- saying that these employees are feeling like there. They they should just leave they company wants to -- is it because. Do they want to hire other people. Are they act and also you know lack of business and hire the people. And it it is cause the visual situation -- column and that they had just emphasize to folks. I know -- they will split the unemployment would Social Security. But another side aborted taxes because -- laid off get unemployment and Social Security. Social life once say I'll recon car. -- -- -- opening out of work. -- thank you currently. And again if anybody has any thought we got an HR experts sitting right here 2601878. Or just your opinion on what it's not about sharing your information Pakistan. Now my understanding for me wrong. In the government workers have always classification. Of people basically do now. Yet -- well and the beauty of that system which is did he range system is that you know ballpark with somebody makes you don't know exactly. And that it would fall within range whatever it is at their classification is and and compensation systems that are set. We'll have those ranges associated so that you can take somebody who has X years of experience. This kind of to Kareem and determined based on market that. What is market -- about market was below market and compensate decline. In -- will hear things such as. Women make 62 cents for even. Is that based on the same job. Yes. How is that existing in 24 team that exists added it's a great question. If I. If I had to guess I would say it's because often women will spend time outside of the work force of compensation system that I was talking about just a minute ago. Works against us in that way speaking as the one. And it we will not have on balance the same number of years of experience and many women will. Happen decreed that the -- nine. Carry the same weight within that system. And we will also have. Problems advancing ourselves and Chelsea handler wrote lenient where she expresses. Her -- thoughts and observations in this in the work force that I find a pretty accurate. It meant effect just on the paper yesterday she's -- -- and Edward she insulin and she's talking bossy bossy. Right. Eliminate that were grade so negative for women but -- -- -- -- Indeed it is what I instinct that today we have these issues I think it's not applied to it's not a one that's right. On the -- Anyway we still heavily ago right. You bring her coaching point that something that's happening in the news as we speak with President Obama. Has the -- -- an executive order known known this is talking and talking and it would do and what it would do is it would expand. Classifications. A non exempt to do more than just the administrative and clerical positions that it's applied -- now apply Q. -- -- -- -- over and that's right and when I say exempt non -- you can just -- from overtime to act to get an idea. And so that would mean that people who right now are on salary. Would be -- any overtime for hours that they work effort at the forty hours that they typically work in a week. And that is on common. A lot of people will pay it and more than forty hours a week and not be paid for that additional overtime because they're currently classified as -- And a lot of companies especially during the downturn. Maybe employees who had been. In to those non. -- and that's actually been going going on since the eighties on her -- even earlier in some cases and it's. It's become this. Kind of invisible. Factors in the work force that you know aegis classify people as exempt and it's it's. It's not that they're doing. Completely correctly it's that the spirit of the line is such that you'll have on balance more -- and more non exempt employees and you will exempt employees but in today's work force. The knowledge economy makes that. Less like. Certainly workplaces where people and of people were placed. On -- -- George disease. Salary in his George will have the 4550. Or sixty hour week it'll George good old George happy for George. That's under on major issues. What is the biggest issues that businesses face today with employees. I would say that most businesses face plan. -- issues. Both directions either management. Leadership. Or even among their employees and being able to use stay current. And being able to make sure that your that your managers and your employees. Are able to contribute in the way you expected them in. One of the things that was the first to go women and the economy. Altered. Was training budget. It faces today we have another caller market from saint Tammany. -- And how -- you will see them and -- for -- anti terror. -- -- -- -- -- -- -- -- You need to for. A couple of or try to make -- I -- in. -- and on. And and the situation who lie and say. -- The program. I can keep product. -- -- -- A lot. Here and every. The -- that. Several in teach that or give me like. The January changed. -- -- need to. Think it over that other people or in the -- Here what can do what can -- do break so and you you should know that and it is your responsibility to bring that to the attention of somebody who can change what's going on and that being said you might be facing resistance from that very person that very entity and. I've gone into -- -- our industry have -- and they even helped me. A lie. Or -- -- your life and the candidate they are you caught it in -- organization. Newton Newton. You know all you can do really is. Is notified the people that are supposed to be notified within your organization. And make sure that you document those instances. And make sure that you write down when you had those conversations with the outcome of those conversations where. And end if you'd. If you don't get their attention and and utility people who -- can you can turn to the government agency that's responsible. For making for enforcing the laws that are not being observed. And and you should be protected there that there is protection for whistle blowers that being said. And you know that's a very serious step to. Pop it looked like an agency did not agency over the program. And -- Brought back to backs actually because. They shouldn't it be as a pass through that -- but I didn't -- program. And each. Well. The director and -- what they'll do help. Will be back. And now you. Can't set it on you in the year like number that they play. There -- One continue to protect yourself. Apply. Working. It won't be -- a bit more. Mean that's. They're being wheeled in -- apparently -- Finance situation. 8. At 8 o'clock out there aren't they. -- -- I I we have -- -- gonna have to take a break we'll be thinking about you but I heard what you said document document document that's right stay with it right back. Well we are with Mary -- come we are talking who was with benefit administrator group she's in HR. Consultant and we're talking about the whole issue of nature and his public talk for six hours on issues that. Employees face that management faces and not about how companies are run but if you registering in the commercial you're really. The goat -- for both sides right. It isn't because I think a lot of people think HR is toward management but you're saying you're really in between. You are and between. You know especially in places like whole foods that adopt. Policies see -- it's reflected in the in the name of the department. Team members services. It's not human resources and yet there are some companies where it's it's a value to have a neutral space. For employees to go and speak in a lot of times things will come out of this conversations that help improve. And that the company overall and and there's got to be a mechanism for that that's not just your supervisor. -- that's right that someone supper going on the management side -- Management. Is displeased with an employee who were all the right reasons they're not cut the mustard right. Then how do we let them ago because it just seems -- just in our little litigious world things are tough right. And so. That it. You can neither follow -- performance improvement plan where you like lay out very clearly these are at these are the expectations that we have been key to meet them. Then they can lead to further disciplinary action leading up to and including termination and that's lengthy. But it's necessary to get their attention. If at that point there's still not. Performing up to the standards that have been set. You can and -- relative just a second and everybody stay with -- we're not done talking about HR issues practice. I wanna thank merry -- some of HR in HR consultant with benefit administration. Thank you so much for being with this state to Dennis launcher is next.