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Most overpaid/underpaid profession? (Page 32)

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_Angie_

IF-Rockerz

_Angie_

Joined: 21 February 2008

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Posted: 17 July 2010 at 10:55am | IP Logged
Originally posted by Mister.K.

@Angie: good guess. I did get burnt in the market a couple of times but I am positive I will get my money back with interest. And my quest for that did start at around the same time (2007-08) even though I wouldn't pin it on the investment world. Something else must have affected my psyche.

Good to see you optimistic !
The time of your quest and economic recession- ...  Some co incidence that !

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_Angie_

IF-Rockerz

_Angie_

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Posted: 17 July 2010 at 11:14am | IP Logged
While some disparities are bound to be there we cannot ignore the growing unrest due to the widening gap. The conflict will soon spread like an infection leaving none untouched.
There is nothing wrong in trying to understand where things went wrong and attempting to provide opportunities to all. Once the person gets a fair opportunity to compete it is up to him how he avails and utilises it. Since every individual is unique the response is going to vary and so will the result.
But without even a level field its an unfair game .

Mister.K.

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Posted: 17 July 2010 at 12:36pm | IP Logged
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souro

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souro

Joined: 27 January 2007

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Posted: 17 July 2010 at 5:48pm | IP Logged
Originally posted by Mister.K.

Originally posted by souro

Why suddenly should the profit be shared with everyone? Give a valid reason for that. I'm not against the idea of giving a share of the profit to everyone but I want to understand your rationale behind such an idea.

The rationale behind encouraging profit sharing is to foster a healthy environment at work place instead of creating resentment and discontent among workers. I could give an example. In India, most companies are closely held with a small group of controlling stakeholders. Take Wipro for instance. About 75% of the company's equity is held by Premji and his coterie. There is no way he would have ended up with that big a stake if equitable profit sharing was instituted. He should have drawn from a pre-tax pool of profits just like any other eligible employee of that company. He didn't. He kept the profits to himself. For a very long time. There could have been people who worked from the beginning in various capacities, as hard, if not more, than Premji, but their fortunes would never compare to those of Premji. He didn't create a level playing field. It's like holding all the aces in a card game to yourself.
Yes everyone will love to get rich by piggybacking on another successful person. However, before saying that we deserve a share of the spoils, we should also ask ourselves a few questions.

Will the employee agree to stake his financial well being, his career and future to ensure that the company becomes successful?
Will he agree to it if the management says that he won't be paid regular salary but rather his salary will be dependent on the successful sales of the goods/ services of that company?
Will he be ready to go bankrupt or almost bankrupt if the venture fails?

Now that Wipro is already a successful and established company and is going on cruise mode, it'll be easier to say 'yes' to all of the above as people know that the risk involved is very less. But what about the time when Wipro was just a startup company. What about the time when Wipro, a vegetable oil company, first ventured into IT and were looking around for clients. When Premji was just another random businessman. Do you think the employees at that time would've been that confident to say 'yes' to all the above questions? I don't think so.

If you're complaining about Wipro not sharing it's profits with it's employees, then you should also complain about employees not shouldering the debt of those companies which went under.

I don't know about Wipro but many companies do offer shares to the loyal employees who serve during the companies initial days because they serve at a time when the company needs their employees the most and not the other way around.
But yes the amount of shares that they hold is far lesser than the owner, simply cos if the company were to sink, they would've revived their career elsewhere, whereas the owner's career would've sunk along with the company.
Have you ever heard that employees of a company committed suicide because the company is going through financial crisis?? Atleast, I have never heard of such a thing.


Originally posted by Mister.K.

Originally posted by souro

Anyways, you're promoting the idea of putting an artificial cap on the highest achievable income. On one hand you're trying to maintain a ratio of 1:20 between the poorest and the richest and on the other hand you're claiming that you're not putting a cap on earnings. Can you show me how it's possible to not keep a cap on the highest possible earnings and yet maintain a ratio of 1:20?

The ratio would be attained gradually, not overnight. More like a 10 year plan, if you will. And like I said, the guy from the lower rung is getting bumped up; the guy at the upper rung would probably remain at the same level. I am not capping, I am distributing what is available, to all eligible, according to policies drawn up in a fair and just manner that do not favor the interests of a choice few individuals and small groups.
You take a year, 10 yrs, 100 yrs, eternity and you'll still end up with caps on max salaries if you have to maintain a ratio of 1:20. If the lowest person is earning 1x, the highest person can't go beyond 20x. If the highest person earns 20x, the lowest person can't go below 1x. Whatever way you want to look at it, you'll see that since the co-efficient is fixed, the value of x will also be fixed for a given point of time depending on the profit that the company made. We won't be able to reward people according to the results that they have produced or the amount of wealth they have generated for the company. A fixed ratio means that you'll have to distribute the wealth generated in a fixed manner and there'll be minimum possibility for maneuverability. Fixed means putting a cap.


Edited by souro - 17 July 2010 at 5:50pm

Mister.K.

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Mister.K.

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Posted: 17 July 2010 at 7:45pm | IP Logged
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souro

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souro

Joined: 27 January 2007

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Posted: 18 July 2010 at 1:56pm | IP Logged
Originally posted by Mister.K.

Souro, there is an inherent risk in everything we do. The FedEx employee delivering a package might meet with an accident on the road. The pizza delivery guy working for Dominos Pizza might get stabbed on one of his routes. The construction worker might fall off the building. The children working on assembling fire crackers in Sivakasi might die if an explosion takes place.

Point is, it's not just the owners who take risk. Employees face huge risks as well.
Yes there is risk in everything. And the remuneration of a job considers the risk involved, intelligence required, efforts required, value generated and obviously the need for that job to the society.
Now, I don't know about you but IMO and in the opinion of most people in this society, a person who is putting everything at stake to start a new business is taking a far greater risk than someone delivering a package or a pizza.
And the bigger the venture, greater the risks.

Originally posted by Mister.K.

if it is just the money you ar etalking about, chances are the seed money is sown in by a venture capitalist or an investment bank. Even the banks take risks by lending to any/all companies. We have recently witnessed how bad loans affected the economy causing things to come crashing down.

And finally, employees too attempt / commit suicide and / or resort to other drastic measures when they lose jobs. They lose homes, cars, and basically go bankrupt if they can't hold on to a job if the bosses screw up and the company goes belly up.
It doesn't matter who loaned him the money. If it's a bank which provided the loan then they'll take their principal amount and interest and leave if the business is successful. If the business is unsuccessful then it'll be the owner who will have to pay the amount through some other means.
If it's a venture capitalist who loaned the amount. Then they will either be a share holder of the company or will lend the money as loan. If they are share holder of the company then they are a part of those who own the company and will get a share of profits generated but will also have the risk of losing if the venture doesn't make money. And if they have given loan capital then they'll get interests and if the venture flops then they'll extract their loan and interest amount from the owner/ business.

Whatever I mentioned above, do you see anything where it mentions that the employees will have to pay up in case the venture proves to be unsuccessful?

And Mister.K. if an employee loses a job, he'll have a second chance of getting another job. His flow of income will cease temporarily but he won't lose everything that he already has. But the owner along with his current flow of income will also lose everything else. How much ever you try to make it comparable, they are simply not and it's the fact. Ultimately the employees won't take the burden of the company's losses and that's why they get fixed salaries independent of the profit generated.

Gauri_3

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Posted: 18 July 2010 at 2:07pm | IP Logged
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