Why your less qualified coworker makes more than you do
Salary is a funny thing. Unless you're in a contracted environment where salary is based on job title and length of service, two people doing the same job can have different salaries. They shouldn't be too far apart -- it wouldn't make sense for one person to be earning $125,000 while the other made $42,000. But a difference of a few thousand dollars is very common. (And the spread is wider and wider depending on the level. It wouldn't be fair to have one person making $25,000 a year while another, doing the same job makes $35,000 a year, but the difference between $125,000 and $135,000 is unremarkable.)
But, sometimes it doesn't make sense to the employee. Like this man who wrote to me. Here's his situation:
I referred a friend of mine to my place of work because he is razor sharp, and has a ton of experience. We are both in the IT Field and it'sreally difficult to find good talent in our area. He was also getting tired of his old job and a position opened up at my company. Here is the issue.... My friend despite all of his brilliance has a G.E.D., has never worked in a large corporate environment, has no IT certifications and about the same amount of work experience, except mine mainly consist of top 100 companies and his are more local.
He was offered $6,000 a year MORE than I make! I have a military background, 2 years of college, 2 relevant IT certifications, and 10 years of work experience in similar companies. And here is where it gets really bad. I knew what the market rate was for my region and I asked for that. They told me they couldn't pay me that and cited something about peer salary being fair. So I did my research, asked for more and got less. He asked for $25k less than I did and got $6,000 more than I did. How do you justify paying someone who didn't finish high school, has NO certifications and has semi-relevant work experience $6,000 more than someone who is significantly more qualified?
This situation doesn't seem to make sense. What could they possibly by thinking? Well, I added the italics (they were not in the original) to point out a few phrases: Razor sharp; ton of experience; and it's really difficult to find good talent in our area. Those are the key things. The company is offering this guy more money because they feel like he's going to be an awesome asset to the team.
And that's probably the reason. Why the letter writer didn't get a higher offer is because, for whatever reason, they didn't see him as valuable to the team as his friend. Maybe there will be different job descriptions, maybe the friend has a special skill that the letter writer doesn't have.
The other information is (and should be) irrelevant. Personally, I'm thrilled to see someone with a G.E.D. rather than a college degree get a great job. (I'm not opposed to college -- far from it, I have a bachelor's and a master's degree -- but college isn't necessary for every job.) The companies one worked for in the past can indicate some level of experience, but it may or may not be relevant for a job.
So what should go into salary consideration?
Actual job description. This is actually the most critical thing. Companies should determine the depth and breadth of knowledge and experience needed. They should then look at the job market in their area, and determine a salary range. This should be done long before the job is even posted.
What the person can actually do. Sometimes you find someone that is a perfect match to the description you wrote. They have the exact skills listed, and the exact amount of experience needed. Perfect. But often you either have to "settle" for someone who is lacking in one or two areas, or you get lucky and someone applies who can do what is needed, plus they have a really nice extra skill. In the case of IT, maybe there is a plan to do X, but no one on board has that skill and they were planning on sending John to training, but then this guy applies and he can do X already. That will result in an extra bump in salary. Or maybe the new hire speaks Spanish, and while it isn't a requirement, there is a client in Puerto Rico that would love to speak with a Spanish speaking sales rep.
What is this person's potential. Potential is a funny thing -- it's kind of hard to quantify, but sometimes we can see it. Often, while a hiring manager is interviewing for this job, what she's also looking for is someone that can do thenext job in three to five years. If you have that potential for growth and development, that's a plus in the salary category.
Education/certifications/licenses. Sometimes this is valuable and sometimes it is not. (And, as I said earlier, we place too much emphasis on pieces of paper and not enough on abilities.) But, as a general rule, having a college degree makes you more valuable than not. Some jobs require specific certifications and licenses. (Like if you want to be a barber, you need to be licensed.) In some jobs certifications are a plus, but not necessary. If you've graduated from law school, but haven't yet passed the bar, you'll have to be supervised and have an actual attorney sign off on everything -- therefore you're not as valuable.
And what should not be considered? Age, gender, race, national origin, weight, sexual orientation, hair color, accent, disability, marital status, number of children, lack of children, political persuasion, et cetera. None of these things matter. Some are, of course, illegal to consider, some are not. Regardless, except in a very few situations, they should not be considered.
If you think, though, that you're being unfairly underpaid, you should talk to your boss about it. And your line should not be, "John makes more than me! I need a raise!" but rather, "I'm contributing at a very high level, and I deserve recognition of that."
Source: 2014 CBS