Last Friday I was in the final stages of editing when I came across the exchange of messages below posted on a social networking site. All messages were posted within about an hour of each other. Employee 1: Morgan Stanley, which is the owner of the world's largest brokerage, cut the investment bank's compensation pool 2% last year to $7 billion. Morgan Stanley's company wide compensation was enough to pay each of the firm's 60,494 employees $238,602.
Employee 2: Strange, isn't it
Employee 1: Not sure what to do with my $230K?? thinking a trip to Hawaii...how about you, how are you spending your $238K??·
Employee 2: At this rate, it'll go towards therapy.
Employee 3: Hahahaha we need more than therapy
Employee 4: I just closed on my house in aspen and I'm picking up my ferrari after work. Anyone want to go for a ride?
Non-Employee 5: take out the top 10 and that leaves about $20 for the rest of you guys, right?
Employee 1: umm zero ;)
Employee 6: Umm don't even get me started on this please?
Ex-Employee 8: sorry, but this is hilarious and tragic
Employee 9: Sometimes I feel like I'm living in a "Twilight Zone" dimension - what is going on with this s--t???
Employee 10: thanks for the salt!:-) Is this the year 2000 or 2011; can't tell by looking at my paycheck!
Pay communication is such an extreme balancing act. In today’s world of immediate distribution and cynicism the job of providing proper messaging is more difficult than ever. The exchange below followed a firm-wide meeting held Friday, January 20, 2011. Morgan Stanley CEO and President James Gorman discussed 2010 results and the impact on pay.
The company went through a major merger with Smith Barney in 2009. Results in some areas have been stellar while others have lagged. The company has a $16 billion budget for compensation and benefits. Someone took that number, divided it by 62,542 employees and came up with an average of $256,595. The number was revised down to $238,602 when accounting for the addition of Smith Barney employees in 2009.
If you are reading this you are probably involved with compensation. You may have needed to read the paragraphs above more than once, and perhaps referred to news articles to fully understand the details. Imagine being an employee trying to take it all in. Imagine being the compensation pro trying to find a way to make this comprehensible.
What I found most interesting was the combination of humor and dejected acceptance in the tone of the messages. I feel like I am standing at the water cooler or lunch table listening to the conversations that never make it much further.
Ask yourself if your staff would have handled the news with a similar level of humor. Ask yourself what you would have done differently if you were the compensation team. I have no answers in this post, but I am hoping that this will serve as additional kindling in our on-going discussion on pay levels and communication.