Does Firing People Ever Get Easier?

[Music] hello everyone welcome to the 21 hats podcast I'm your host Lauren Feldon this week Sean busy Jay goz and William Vander bluman discuss whether the old line about hiring slow and firing fast makes sense during a labor shortage as William puts it what if you do have to hire fast how do you do that what if you do want to keep people even if you might have wanted to get rid of them before how do you do that without ruining your cult plus how do you know if it's really time for someone to go and what happens when employees share their salaries with each other anything good and as we all binge watch the real life dramas about Wei workor and thonos the question inevitably arises is it still okay to fake it until you make it and if so where do you draw the line even in Good Times owning and running a business can be a lonely Pursuit our hope is that these weekly conversations will let owner know they are not alone in facing challenges same thing with our daily newsletter the 21 hats Morning Report which highlights the most important news of the day for business owners and which you can subscribe to at 21h hats.com where you can also find transcripts of our podcast episodes and lots of other articles and interviews joining me this week on the podcast are regulars Shan busy CEO of Kinesis which is based in Portland Oregon and works with small businesses on marketing culture and strategy Jay goldz whose companies in Chicago include a picture frame business artist frame service and a home furnishing store Jason home and William Vander bluman who is CEO of Vander blumen Search Group a houston-based recruiting firm that works with churches and other faith-based organizations the episode is titled does firing people ever get easier welcome Shan Jay and William great to have you all here today we're going to talk about every entrepreneur's favorite task which is firing people I'm wondering if given the labor shortage that just goes on and on are companies reversing the way they normally do things and hiring faster and firing slower is that a problem and is that something you're seeing William well Lauren I think they've always hired fast and fired slow and that's part of the reason I have a job if doesn't work very well I I do think there's an interesting question that this job churn or great resignation has uh initiated and that is what if you do have to hire fast how do you do that and what if you do want to keep people even if you might have wanted to get rid of them before how do you do that without ruining your culture do you have any advice for companies in those situations what what are you telling your clients retention is the ball game right now so if you've got good people like figuring out how to reward them uh we've talked on previous shows about you know a retention bonus something that doesn't isn't going to cost you every single year but gives you a chance to keep people a little bit longer and to build your pipeline a little bit deeper but the hiring fast thing is just fraught with danger I think what you're seeing is that most organizations didn't give very serious Credence to their hiring process for many many years they did a very poor job of articulating the value proposition of their employer brand why you would want to work there they gave all the emphasis to sales and marketing for the external customer and so as a result it's really hard to understand what it's like to work at a business and and so now they're in panic mode and so they're looking for silver bullets to solve this like multi-year problem that they've had and so so I'm seeing a lot of Band-Aids out there like well we just need to write better job descriptions or we need a careers page you know that that kind of stuff but it it's fundamentally they need to reexamine it from from top to bottom and weed out all the inefficiencies that are in the process I've got I mean I have a friend he did like nine interviews with a company over the course of multiple months and it's just insane and so small businesses I think they can use things like technology to automate the stupid stuff and then use Humanity to accelerate the understanding and insights of the employee and that's really what needs to happen not you know these like kind of platitudes of high Fast Fire you know fire slowly or whatever it is that's not the answer like the answer is actually to be strategic about it just so you know it's higher slow and fire fastar I asked the question because I think a lot of companies right now are feel like they're in a position where they have to hire faster than they usually do yeah and then they're sewing the seeds of misery I have to say this just because you're trying to H your fair F doesn't mean you have to it just means get back to them quicker that doesn't mean you're going to necessarily do a bad job with it but there certainly is something to you need to hire faster it means close the deal quicker you know check the references quicker hire them quicker there's nothing wrong with that but but you probably should do that because it's very competitive out there yeah that's true I swear I've hadit 10 people leave out of 130 over the last year and I replaced them with 10 happy productive people that are here mostly Millennials I maybe I'm attracting them because we're a nice comp I don't know why but it worked I you know did I have a hard time finding a truck driver absolutely but we finally did and he's solid so that one was tough that took that took six weeks but there are people out there looking for jobs are you doing anything different Jay I don't think so one of them said you know what my last job I just got beat up by customers every day and there was nothing I can do about it here you Empower me to take care of them and take care of the customer they're thrilled to be here I don't know what to say I has it changed the marketplace to where the employees are being more selective now and theyd rather work at a smaller company and maybe make a little less money than the big company and not sell their sot maybe Jay you've also had some tough firings um one in particular I'm thinking of that you've told me about the the person who had to be fired reacted very poorly to it kind of a nightmare scenario can you tell us about that we hired somebody thinking we were it wasn't a great story how they left their last job but there was some particulars that we figured okay it probably wasn't them we hired them we tried to make it work for nine months we did everything we could it wasn't working my HR person uh uh sat down with the manager and told them it wasn't working they went into the whole this isn't fair routine you know I'm trying hard unfortunately trying hard doesn't matter I'm sorry I mean if you can't get the job done no the customer doesn't care whether you're trying hard or not so we gave it everything we had the HR person left and then the employee started to text her that thank you I needed to push I'm going to kill myself now and blood's on your hands and blah blah blah blah blah and my HR person was rather freaked out about it obviously and she came to me and I called the emergency contact and explained the situation wait wait wait you called the the emergency contact that the employee had listed yeah because this is one of those situations where there isn't a hard line of oh well that's personal no I feel a responsibility that someone says that I need to call their emergency contact and tell them what's going on and they were thankful that I called them and they said that there's some issues there and we had a nice conversation and they thanked me for calling did you have any thoughts about that Jay I mean Zero Zero from a privacy standpoint you know I know zero no hesitation I am not going to have someone tell them they're thinking of killing themsel and not call the em there was no hesitation whatsoever um there's a thin line between being the boss and being a human being and I can't I I absolutely feel the responsibility that you need to tell their emergency contact and then you've done what you were supposed to do I totally agree with you Jay and from a uh in in our world you know a good bit of our search works for churches and in a church if someone uh indicates that they're going to harm anyone mortally you're usually bound legally to report that to someone I would say harm to yourself is the same as harm to an individual I'm going also tell you something people don't understand and I called a lawyer and I'm correct on this people have a misunderstanding of HIPPA laws HIPPA laws are for healthc care providers as the boss you're not bound by hippo laws so even if there was I would still have done it anyway but you couldn't call somebody's contact and say that somebody has a medical condition that they might not have been aware of could you okay that would be a bad move and would be wrong but it would not be violating Hippa loss because I'm not I'm not a hospital I'm not a doctor yeah fact I had a situation 30 years ago with someone who was clearly having some serious problems they were losing weight like crazy and I now this point I'm 30 some years old and I used to always say to myself they don't cover this in business school I'm way past that now I called her brother because I was afraid this was I was afraid she was clearly becoming anorexic I mean she was just losing weight Karen Carpenter had just died a few years before I was and I said to myself well gee isn't there a line between personal and business and I said to myself I'm sorry I'm not going to go to her funeral and have her brother walk up to me and say I can't believe you didn't call me my no I I I struggled with it for a few hours but yeah I made the call and I don't regret it that person was still employed when you did that right yeah and she was mad about it and she quit when I talked to the brother he said oh my God that makes perfect sense so I don't regret doing it unfortunately when you're the boss and you're in the middle of some we have to be the boss but we're also supposed to be I think responsible human beings and uh with that being said the second that I take care of that I'm done I mean you know I'm done I did what I was supposed to do and I I'm sure the emergency contact person is going to take care of it Jay the person that you fired who threatens suicide did you learn anything from that situation would you do anything differently looking back at it that's always the question um I don't think so we're trying to give an opportunity to somebody there was another issue which I'm not going to get into what why I think they had a problem with their last shot we tried to give a shot this somebody the irony is the the person says oh this isn't fair no I'll tell you what's not fair it's not fair that I gave this person an opportunity and now they're telling me I'm not fair like I'm way over that it's like if you think when you fire someone they're going to go you know what thank you for the opportunity you're right I should get fired you're extremely naive if I knew what was going to happen I wouldn't have hired him but we took a little bit of a chance and I will continue to take a little bit of a chance giving people an opportunity that I think and sometimes it works and sometimes it doesn't so um did we wait too long uh I don't know I mean clearly the fact that it's hard to hire people probably had a little bit of a factor into it but I I have no regret I think we gave I think we gave the person an opportunity unfortunately there's people in the world who thinks if they try hard that should do it and unfortunately um that's how you go broke having a bunch of people work for you who try hard but can't get the job done um that could be disastrous sha or William have either of you had uh a difficult firing like that and have you learned anything about how to deal with it not where someone's threatening to take their own life that's pretty unusual yeah I haven't had that low I'd say the thing that this makes me think about is I I met a a business owner recently and she had a really interesting model and she's the second person I've met in the last few months where she has what's called like a second chance program and so she's actually hiring uh folks with a criminal record and and I'm sort of seeing more and more of that kind of conversation and it's made me realize that the uh challenge to employment is so significant that folks are starting to reexamine their criteria for how they include or exclude people and a lot of that um the mentality that has driven hiring for the longest time was we want to hire people who have absolutely no issues when they come in the door they're like perfect human beings and you know no human is perfect and folks who you know may be in a really good place when you hire them can go through hardships as Jay's talking about and I think this is something that's not really talked about very much you know in terms of the small business community that when you're a small business employer when something hard happens to an employee or there are outside forces acting on that employee boy do you feel it and and you have to make hard decisions oftentimes like I had an employee years ago where I would get these calls from a family member who who was trying to find her and she was like oh I don't want to talk to them and it was like clearly there was some drama there and you know how do you manage that those kind of situations that's nothing compared to somebody who's suicidal but it's the whole spectrum and I I don't think there's a lot of guidance on this kind of stuff no and it leaves you in the beginning when I was younger I would think I didn't sign up for this I'm just a b and I realized yeah I did sign up for it we've all signed up if you have enough employees the reason it hasn't happened to you is you probably haven't had a thousand employees I have it's just a matter of odds and yeah I did sign up for this I'm not complaining about it it is what it is does it get easier absolutely absolutely you're a doctor and you're in the emergeny room I'm sure in the beginning when someone comes in from a crash and their eyeballs hanging out you're going to vomit or something I'm sure after a while you kind of get used to everything I was telling my friend who's a psychologist story she goes oh my God how do you deal with it I said I'm used to it I don't know what to say Jay you had one that did make you physically sick didn't you yeah back in the old days 1990 had a key person it was going badly it was all kinds of stuff going on and I was so stressed out I didn't know it at the time but I do now I literally had back pains I laid down on the floor I literally could not get up off the floor I as my wife calls our neighbor who's a doctor he said call an ambulance I literally went to the hospital in an ambulance because I couldn't get up and I look back that was absolutely all stress related is just somebody quitting on you or was not quitting it was my quote unquote key guy and he'd been with me for five years and it was my first big you know I've had now in 43 years I've had four four occasions to have to part with someone who was kind of a key person and this was my first one and it was very upsetting and I was all stressed out about it and I was all of 34 years old I've had a couple past then and I can tell you it's nowhere near as upsetting and I will o tell you that I believe that firing people it might not sound great but it's one of the top five things that one he has to do to run a successful business unfortunately it is what it is and and knowing when to fire them and taking care of it some people just do not fit at the company and it's it's unhealthy for the company it's not good for the customers it's not good for the other employees and that's just one of our jobs Jay I think somebody hearing that might think you're saying that one of the key things in running a business is firing a lot of people no not at all it's firing the right people it's knowing when somebody can't do the job you've given it everything you can you've coached them you've mentoring you've told them and it just isn't working that there are sometime and it certainly gets easier as you get bigger in my case we don't fire a lot of people anymore because we've gotten much better at hiring much better so it doesn't happen a lot at all but but I've seen companies draged down because they didn't have the stomach to to do what they needed to to do and I'm sorry this is one of the jobs of being the boss and we don't fire a lot of people anymore but it is a necessary I won't even call it an evil it's a necessary part of business William has it gotten any easier for you no I think the day it gets easier you need to do a little self check and probably go see a counselor I mean that's Jay you're talking about yeah I think you meant easy I think you meant when it gets easy not easier it should get easier because you recognize it but you're yeah I'm not arguing it should never be easy yeah very well said I was about to say something similar that I think Lauren it's far easier for me to see that it needs to happen now like a younger version of Me Maybe I had some sort of Messiah complex I can fix it I can save it I can you know Salvage this I can repot them here I can do this I can fix it and I think as I'm getting older I'm realizing my limitations and maybe hopefully I've got a little more discernment to realize yeah this just is not working but the actual for a lack of better word execution of it oh no that's not any easier how about you Sean I don't think emotionally it gets easier but I do think to Jay's Point there's something about you know when you do something over time you I think you get better at recognizing when when it's just an inevitability and I think you get a maybe a little more forgiving on yourself you know CU I think that's what the hesitation is for a lot of owners is right they made the the decision to hire this person so if they're not working out I think subconsciously they don't want to accept that they made a mistake and they also want to give that person this all the benefit of the doubt and sometimes they're very nice very a lot of times they're people they just can't do the job here's the test you ready still use this this is my magic test you say to yourself if this person walked into my office tomorrow and said you know what I'm moving to California and I'm quitting would your visceral reaction be relief if that's the case they shouldn't be there and I use it myself all the time I talk to other managers I go listen how would you feel if they could tomorrow would you be no okay well it's not time yet that's when I know it's time I think the most important thing that I've learned is that the way you handle it can be improved upon a lot as you as you get more experienced and and I hopefully I've gotten better completely agree with you Sean I would say on the whole higher slow Fire fast thing I think what I'm learning and I'm still learning right is yeah you har slow you decide you come to the conclusion that someone needs to be let go quickly how it gets implemented might take some time to do it correctly if that makes sense well one thing one needs to understand is you're not going to win the fight with them they're not when they go that's not fair don't think you're going to convince them oh no no this is fair here's why you need to recognize they're probably not going to agree and whatever they say you say I'm sorry you feel that way but you're not there to win the fight you're there to just let them know that you that that you've given it your best shot and the need to leave but don't think you're going to win I found the book crucial conversations to be really effective for um letting employees go it's it's a it's a framework around coming to a shared agreements and having hard conversations and honestly I use it to let go of clients and I've used it to let go of employees and it's it's really good because it's it's based in empathy give us a a hint Sean what what what have you learned about handling that difficult situation that you do better now than you used to yeah so first of all is you've got to be a lot more stoic about it and so a lot less of a taking it as a personal thing you know whether that's I failed as an employer or they're a failure as an employee and really stick to kind of the core facts and what you do the in that framework you know this is is a very cffn version but essentially you work with the employee to come to a shared pool of understanding so in that pool of understanding are all the things you both agree upon so that can be everything from like hey you know Cindy I I've noticed that you've been coming into work and you've you've been a little bit um maybe downcast do you think that's accurate is that a is that a fair description of how you you know so you're working to come come to an agreement on what the situation is and then you're exploring and you're getting curious like so Cindy why are you so downcast you know like and and eventually you get to a place where actually Cindy recognizes that she's not engaged with the job anymore and that's the best outcome where the employee actually kind of comes to that Revelation but fundamentally if you can use that shared pool of agreement then you can begin to have the hard conversation um because you've come to an agreement on what the what the situation is that's the process I've come to use and I've I haven't had to fire somebody in a long time but when I do it um whether it's on the client side or on the employee side if I fall back onto that framework which is setting aside my emotional investment which is being curious being empathetic looking seeking to understand and seeking to come to agreement as to what's going on that has worked wonders for me well the benefit of that approach is that some people will figure out they need to look for another job and quit yes which is great for everybody so every nobody I would say this statement usually not all the time people shouldn't be surprised it's your job to make sure they're not surprised right yeah if somebody goes I can't believe you're doing it I can go I can't believe you're surprised I told you three weeks ago that if you did this again that it was going to be and what part of this could surprise you I don't know but whatever I I I I believe in righteous firings you've done everything you can to fix it you've you've given the opportunity to the employee to fix whatever their problem is and they didn't so I don't think it's usually I'm sure there's some occasions where you can't it is surprise but it's best if the employee is is has fear warning of what the problem is and they can fix it and uh like I said sometimes they figure out this is the wrong place for you for them and hey good for them good for you good for everybody well and yeah you know I think depending on how you treat them you can turn that into into either a really awful situation where they're getting on glass door and they're leaving comments about how terrible of an employer you are or you can turn it into a neutral situation where you know they depart and you know you shake hands and walk away or you can turn into a positive situation where I and I've had this happen where you know fundamentally the direction of the business was going in a different way than this employee wanted for his career and we both had that crucial conversation he recognized it I sad too because he was a great long-term employee and so I was like let me help you find a new job and so I worked on that and like I kept him employed and he found a great new job and he moved to New Zealand and he was happy you know it's like that's a great outcome you know but it takes work there's also if they've been there a while there's there's the question of severance pay yeah I paid out lots of severance pay over the years some people don't believe in it I do someone's been with you for 10 years and as you just said things have changed changed and yeah severance pay letter of recommendation um there's something you can do sometimes and sometimes obviously not any of you guys or Lauren do you have you heard of people actually budgeting for severance pay I've never heard of that but that's intriguing I say that because we have some clients and it's usually usually it's this scenario that I've run into uh a Founder starts whether it's a school or a church or nonprofit or business they start it they make a 30-year run and some of the people that started with them and have been with them a long time their jobs are there's a need for fresh blood and uh new faces and new voices and it's just going to be really painful to let him go and so these these guys I think very shrewdly have said every year we're just going to budget some severance pay that allows us to be more generous than we probably ought to be and if we don't spend it we don't spend it we'll give it away something else or poured into a new initiative it's it's kind of an interesting thought it is really interesting because that that phenomena is real of like employees who were great in the beginning and and then they no longer really fit into the company's needs called that Growing Pains the people that were so great when you had five employees frequently do not fit in when you've got 40 and it is naive but and unfortunate but you are going to outgrow some people and it's it's painful it's extremely painful but it is what it is totally agree I keep a copy of the book what got you here won't get you there in my office where I can see it just so I can see the title because it just happens but it's it I just think it's fascinating to say you know we we have a part of our budget that's set aside for projects we don't even know are going to happen during the year but they're going to happen like opportunity budget the older our organization gets the more I I don't have anybody I'm ready to fire or anything but I think it's pretty dang insightful to say why don't we set aside some money if we really need to be generous to somebody who's been here a long time but their run is over yeah yeah that's a really intriguing idea well we're running short of time let me try something else here probably all of us have been binging content lately uh about entrepreneurs and a lot of the stories have not been all that positive I'm thinking Wei work I'm thinking Theos a lot of it is about the concept of Faking it until you make it and um I think we all probably agreed that Elizabeth Holmes would kind of cross the line but I'm wondering where is that line drawn and and just to start this conversation I want to recall that when I was an an editor at Inc magazine I edited a column by Norm Brodsky who was the lead columnist and the best red thing in the magazine and the owner of a Box Storage business he wrote a column in which he talked about how he got his Box Storage business off the ground and he identified a problem he had which is he would give people tours of the warehouse and they would see it was completely empty and they would wonder should I trust Norm with my crucial documents that I need to get access to at some point why should I trust somebody who no one else is trusting and here's what Norm wrote about this his response was I had an idea we went out and bought 2,000 empty boxes put bar codes on them and use them to fill the shelves we then put mirrors in the back wall from a distance it looked as though the warehouse went on forever and was absolutely packed with boxes when we took visitors on a tour of the facility we put up a rope to make sure nobody got close enough to the mirrors to see how we' created the effect prospective customers who came in began asking whether we had enough room for their boxes we assured them that we did what do you guys think I'm okay with the empty boxes I don't think I would have done the Mirror part I just think in my world what's the difference one is decept well I I I just think one is obviously trying to trick people the other one is just the Practical thing of you know it's going to look bad and it's about being dishonest I don't know you could argue this it's the same thing I just think putting mirrors up though there's something about that that just seems like you're really trying to deceive people I got no problem with the Box thing anybody else Sean William I mean I can remember moments in my life when I have said that expression fake it till you make it and everybody does it right to some extent right so you're asking where where do you draw the line and here's my line lying lying that's my line lying someone bring something to me to frame when I was starting out and I'd never frame one I don't necessarily G to go geez this is the first one of these I ever frame but if they asked me I would tell them but I don't know how you there was lots of things I was learning along the way way I by the way Norm said that in the column he said there are two things you don't do you don't lie and you don't do any harm and he felt he was okay in this situation others might see it differently I don't know William you're the you're the ethicist Among Us come on help us out here my oldest son he's 28 he just we had a a family group text the nine of us and he just sent this new social media platform around saying have you guys seen this and all of his uh College age siblings said oh of course you're already on it maybe you guys have heard of it's called be real have you heard this no I have not so it's basically Snapchat if I understand it right I'm an old guy but you don't get to pick when you get to post the app says okay you have to post right now so you don't have time to set up a filter you don't have time to put on makeup and the whole thing and it's taking off they got like 600,000 users already and it just got going and the whole thing is a reaction to the overproduced overspun over filtered world that we're seeing on social media and I think the Gen Z generation is like hey we know everybody's Faking It Could somebody please just be real so I kind of wonder if the future of marketing isn't more and you hear it when people don't people don't talk about their strengths anymore they talk about their vulnerability people don't talk about their successes anymore it's like their failure or their working through their mistakes and I kind of Wonder I'm dodging the question but I was going to say yes you I kind of wonder if the fake it till you make it is is not as in Vogue as people think and I mean I binge watched the whole thing with Jared Leo and uh Anne Hathaway the we crashed and was pretty amazing did you cringe but were you cringing to it I was yeah I am a marketer salesperson at heart I want to present the best possible version of the truth as I can and and as my best friend who's an attorney says William it's always good when it has the added benefit of being true so so I I think I'm just William did you fake it until you made it no not not our current business not our current business now did I sign up for stuff we hadn't done before yeah and figured out how to do it on the way you know we say hey let's jump out of the plane and build the parachute on the way down but but now that we've done that a lot we'll get a call for a kind of search we've never done before we say hey you know what we've never done this before but we've done things that we've never done before for a long long time and we'll get it done for you so it's it's I think I'm softening maybe I'm just getting uh maybe I'm not a very good marketer anymore successful maybe you've just gotten successful and you don't need to do it anymore maybe I don't know I was thinking about like what how did I use that expression and I remember back you know we're kind of recovering from the recession and kind of for the first time I put the word CEO on my title and you know it felt so ridiculous because we had like no employees cuz we'd lost everything and and for me it was it was aspirational it was like okay I'm going to treat this like a real business now and not a hobby and a lifestyle and and so that was almost like I was sort of I was talking to myself into into a new way of being and I think for owners I think that's their version of Faking it until they make it right like I believe I can be this business that I want to be and I think that's okay I think that's fine but I think what we're seeing is the deception piece right you're seeing you know the active deception of customers and shareholders you know that's that's where it's kind of become corrupted all right next topic William I believe the last time you were here we were talking about marketing and you brought up or somehow the topic of direct mail came up and you kind of poop pooed it and Jay kind of challenged you to go do it and you seem to be taking his challenge seriously did you actually try a direct mail not yet but we're close okay just to be clear I didn't challenge him to do it I challenged his conclusion oh Direct Mail doesn't work people throw it out I challenged that because that's simply not a true statement if direct mail didn't work for anyone no they wouldn't be doing it anymore it clearly works for some companies it totally got my attention Jay and uh particularly you know a fair amount of work that we do is succession planning and uh within that succession planning there's a large subset that is succession planning as your CEO head of school senior pastor is preparing for retirement well that's the list we're working on segmenting and figuring out where what's working with them so we can do a direct mail toward a demographic because I do think that demographic will look at actual physical mail more likely than a gen Z I'm confident that you're going to have success with that because you're targeting it properly clearly you need to Target that kind of stuff to work Willam had said that you shied away from the idea of just reaching out to clients and sort of reminding them that you exist and you know what your mission is and what you do have you rethought that at all a little bit it's funny you asked that um you know what I shy away from I having been a senior pastor of a very large church I hated vendors I really did and I hated the Slick sell and I could feel it when somebody was trying to sell me and I just didn't like B yuck I don't want to be that guy I don't want to be the guy that when you hang up you're like I need to take a bath he was just trying to sell the whole time so I've been avoiding that and we've LED with content as you have uh highlighted several times and I've also avoided I had a a very good Mentor say to me one time when I started our company said William you know your number one danger is that you're going to outs sell what you can deliver and I've tried very hard not to do that because I could end up selling too many things and not being able to deliver but now uh after the pandemic particularly I'm pretty convinced that our system is able to handle a lot more bandwidth and that it is very easily scalable so we're getting more and more uh warm to the idea of being aggressive of of working parts of the funnel that are up toward the top and and even cold call or direct mail all right last topic of the day we only have a couple minutes left but I wanted to run this bio I was recently talking to to a 25-year-old working in kind of an entry-level job somebody who's been working from home recently went back into the office um not back actually for the first time was hired while the office was closed and has everybody's been working remotely the office recently reopened people have gone back in and this 25-year-old told me that with literally literally within half an hour of being in the office and meeting his colleague they had all exchanged their salaries and quickly determined that there was a very wide disparity in what people doing similar things were being paid it kind of floored me the idea of you know I've never done that um I don't think anyone my age has done that I'm Cur are you seeing this phenomenon does this surprise you thoughts seeing it 100% wow really 100% among yeah among uh definitely Millennials and definitely gen Z and does that change the way you think about things the number one problem we run into with clients is in order to get this guy I had to give him this deal in order to get this woman I had to give this deal in order and everybody's got different deals and it's all a house of cards that falls as soon as people start sharing as wooden or government sounding as it is to have a pay grid with you fall into this tier this tier this tier it's where we're advising a lot of people because it glass door is not just a website it's what we're living in I don't know that it's happening here but I always have paid people with the idea that let's assume they talk about it and make sure that we got clean hands but this was actually helpful for you to tell me that because I'm going to remind my managers of that that I don't know if it's happening but we should assume it's happening and but we're pretty careful with that stuff and uh like I said we just you you know somebody might talk I'm rather floored that this was a topic of conversation the first time they meet in the office so within half an hour wow wow Sean have you seen anything like that well so Oregon is special in so many ways um we have a pay Equity law so you legally cannot pay people differently if they are doing the same job and have the same level of experience how is that enforced um I imagine through lawsuits you know I'm guessing that when somebody finds out they're they're paid differently than a coworker I'm guessing they have some means of relief we got way ahead of it I I did actually what William is advocating for uh years ago um so there's transparent pay and compensation banss within our company and then we do salary surveys transparent pay meaning everybody knows what everybody makes anybody can find out what any position pays within the company what the range of compensation is within that wow that's fascinating because we don't post it we don't say we don't we don't post it for the world you know for everybody to see but if you know you're in a role and you want to go into a different role and you say hey what is this roll pay we have a formula for that so how many employees do you have we're 14 okay that might work with 14 employees I can tell you that if you have 130 there's some people that are making a lot of money because they earned it and they're worth it and if some of the people at the bottom saw what they were making they probably would be flabbergasted and like I have no interest in and sharing that information I mean I know of other companies that are much larger than us that have have implemented this so in Oregon all in Oregon no outside of Oregon yeah I mean it it takes a cultural shift right it takes it takes a ton of Financial Training and education so that employees understand what's going on like we have a whole curricula around this I mean you can't just do it like I think that is a terrible invasion of privacy for the person who's making $160,000 a year that they should have to have their salary disclosed so that the person who's making $43,000 a year I just think it's an invasion of privacy I don't think it's any of other business well your privacy is going to be invaded anyway I mean look at look at the story Lauren started with okay I'm sure that those people sitting around we're not making 160 Grand as my point that's a different level there is no privacy Jay yeah give it up man William do you have any advice for companies that are becoming more transparent or how to do it in a way that that works well I'm only half kidding when I say there is no privacy so you know I just don't think Jay that your uh people are as quiet as you think and if you don't think I I was actually going to Google but Lauren asked me a question I was going to go to glass door and look up your company Jay and see how many salaries are listed because people do put what they make on the internet I'm not talking about the $42,000 year employee I'm talking about people that are high higher up that have major responsibilities I don't think that they're out there telling people how much money they make oh they totally are in fact they're doing it more than the put it on Glass St absolutely totally disagree with you Jay so I want to be clear William you've got your I want you to think of your top person there probably makes six figures correct yep High six figures okay everybody know what that person makes I would like to think they don't but I'd be surprised if they don't here's the problem when you survey employees and you ask them what they think owners are making they radically overstate that number yeah I've heard that so the problem is is if you don't fill the void of information with with truth stories will pop up and and then what's happening now is the cultural norm has no longer been that you don't talk about your salary as as Lauren articulated at the beginning people are talking about it and they're putting it online and so you got to like I really feel like as owner you got to get ahead of this stuff because it's just a nightmare if the storytelling starts and then you know you have one person who's making dramatically more than another person for the same job there's no no argument there for the same job there's no argument there that that that shouldn't happen I'm suggesting in a hierarchy where there's people that have far more responsibilities and far more talent and are major drivers in the business they're going to make a lot more money than someone who you know is at a lower level and I just I think the that there's there's certain truth to what you're saying for sure they're talking about it more but I by no means think that 100% transparency is what would be the best idea or what's appropriate so Jay if I told you what the salary range for a sales manager at your company was right now would that be something you want on the podcast go ahead $74,400 that's what glass store is telling me right now um I have no idea where they got that from is that accurate for a salesperson you're receptionists are reported receptionists are reported at 1643 an hour and your production workers are reported at 1565 an hour okay and there is no privacy okay I don't mind that it's probably fairly accurate it is what it is I like I said this that those aren't the levels that I have concerns about it's the higher levels are you concerned about the higher level people finding out what other higher level people make or are you concerned with the people making $16 an hour hearing that so and so makes $150,000 yeah yeah I think that they don't understand they don't understand the contribution that person makes to the company and I maybe they do Jay maybe they do understand I don't know I it's just not my I I just have no reason to I just have no reason to go ahead and announce it I think you I I wouldn't go ahead and announce it Jay and I'm not at all trying to minimize your very real concern because you can't stop human greed it just and some people do bring more value to the company than others I just think uh when Lauren asked his question I was like what's the question of course they're talking and I think we'll have to leave it there my thanks to Shan busy Jay goz and William Vander bluman as always thanks for sharing guys wait wait don't leave yet if you have a question or a comment that you'd like the 21 hats owners to address send it to me by replying to your Morning Report or by email at Lauren 21h hats.com that's l r n any onh hats.com do it now before you forget and don't be afraid to tell Jay what you really think he can take it and if you got something out of this conversation help us reach more business owners tell a friend subscribe and review us wherever you get your podcasts follow us on Twitter subscribe to the morning report at 21h hats.com this episode was produced by Jess dubron founder of blank word Productions okay now you can leave thanks for listening everyone