Persimmon Homes -- CEO £100m Bonus...
Discussion
sidicks said:
John145 said:
It’s £20,000 per employee. I wonder what kind of pay rise they saw. It’s very frustrating, in the business I just left they were making £30,000 profit after tax per employee yet gave a tiny 2% pay rise.
Do the employees own the business?John145 said:
It’s £20,000 per employee. I wonder what kind of pay rise they saw. It’s very frustrating, in the business I just left they were making £30,000 profit after tax per employee yet gave a tiny 2% pay rise.
So you think it should have been shared equally with all employees?Why stop there? Why not add in the contractors and security guards?
And then we remember that a lot more people are responsible for the success of the company. The taxi drivers that get the workers there, the workers who build their cars, the police who ensure that property laws are enforced so that people will buy houses, the doctors who inoculated the workers as babies...
I think that the £100m was a commercially poor decision, a poorly thought out scheme, but I also think that implying that it should be shared out equally makes little sense too.
Maybe what the government should do is to take a good proportion of it into public hands, and use that for the general good. What would you say to £47 million as a reasonable figure?
Its a massive bonus, its way out of kilter with the sector and most of the work from the growth in t/o for Persimmon was done by his predecessor and an almost completely different main board, but it is well run, its just innovative as a business.
In my experience of the business I doubt they will give a flying f**k about what anyone thinks.
Generally, and this includes Persimmon, the house building industry pays reasonable bonuses, but when the market is tough it takes no prisoners. There is very little job security at any level. In fact the safest jobs are those of receptionist or secretary.
In my experience of the business I doubt they will give a flying f**k about what anyone thinks.
Generally, and this includes Persimmon, the house building industry pays reasonable bonuses, but when the market is tough it takes no prisoners. There is very little job security at any level. In fact the safest jobs are those of receptionist or secretary.
John145 said:
sidicks said:
John145 said:
It’s £20,000 per employee. I wonder what kind of pay rise they saw. It’s very frustrating, in the business I just left they were making £30,000 profit after tax per employee yet gave a tiny 2% pay rise.
Do the employees own the business?Staff are paid a market rate for a job done. If they want a bigger slice of the pie, they have two choices; they can either pony up some capital and invest in the business or they can progress their career to the point where they are senior enough to contribute materially to the organisations performance and be rewarded accordingly.
James_B said:
John145 said:
It’s £20,000 per employee. I wonder what kind of pay rise they saw. It’s very frustrating, in the business I just left they were making £30,000 profit after tax per employee yet gave a tiny 2% pay rise.
So you think it should have been shared equally with all employees?Why stop there? Why not add in the contractors and security guards?
And then we remember that a lot more people are responsible for the success of the company. The taxi drivers that get the workers there, the workers who build their cars, the police who ensure that property laws are enforced so that people will buy houses, the doctors who inoculated the workers as babies...
I think that the £100m was a commercially poor decision, a poorly thought out scheme, but I also think that implying that it should be shared out equally makes little sense too.
Maybe what the government should do is to take a good proportion of it into public hands, and use that for the general good. What would you say to £47 million as a reasonable figure?
For me it would go into pay rises, not bonuses. It’s nice to have a bonus, it’s better to have the security of a salary whilst using the lump sum of cash in investing in staff for the long term.
John145 said:
I think we should be smart about how we pay this kind of money. Dumping such a large amount of money on, let’s face it, an individual with good ideas whilst holding back the rest of the workforce is equally dumb.
For me it would go into pay rises, not bonuses. It’s nice to have a bonus, it’s better to have the security of a salary whilst using the lump sum of cash in investing in staff for the long term.
Pay rises mean you have increased the fixed costs for the future. Bonuses are one-offs.For me it would go into pay rises, not bonuses. It’s nice to have a bonus, it’s better to have the security of a salary whilst using the lump sum of cash in investing in staff for the long term.
ClaphamGT3 said:
Indeed - profits distributed to the investors who have risked their capital and the executives who have delivered performance IS the right direction.
Staff are paid a market rate for a job done. If they want a bigger slice of the pie, they have two choices; they can either pony up some capital and invest in the business or they can progress their career to the point where they are senior enough to contribute materially to the organisations performance and be rewarded accordingly.
Where do you build up capital when you’re working in a “market rate” job whilst house prices and rents increase faster than salary? Poor reasoning. What kind of capital do you need to raise to have any chance of having it contributing towards a life? £100,000? £1,000,000? Staff are paid a market rate for a job done. If they want a bigger slice of the pie, they have two choices; they can either pony up some capital and invest in the business or they can progress their career to the point where they are senior enough to contribute materially to the organisations performance and be rewarded accordingly.
ClaphamGT3 said:
John145 said:
sidicks said:
John145 said:
It’s £20,000 per employee. I wonder what kind of pay rise they saw. It’s very frustrating, in the business I just left they were making £30,000 profit after tax per employee yet gave a tiny 2% pay rise.
Do the employees own the business?Staff are paid a market rate for a job done. If they want a bigger slice of the pie, they have two choices; they can either pony up some capital and invest in the business or they can progress their career to the point where they are senior enough to contribute materially to the organisations performance and be rewarded accordingly.
ClaphamGT3 said:
Indeed - profits distributed to the investors who have risked their capital and the executives who have delivered performance IS the right direction.
Staff are paid a market rate for a job done. If they want a bigger slice of the pie, they have two choices; they can either pony up some capital and invest in the business or they can progress their career to the point where they are senior enough to contribute materially to the organisations performance and be rewarded accordingly.
In house building I would say that all employees at any level have the opportunity to contribute materially. Sadly many don’t see it this way. Staff are paid a market rate for a job done. If they want a bigger slice of the pie, they have two choices; they can either pony up some capital and invest in the business or they can progress their career to the point where they are senior enough to contribute materially to the organisations performance and be rewarded accordingly.
House building is a team effort, but its generally senior management that lose their jobs first when targets are not met.
John145 said:
Where do you build up capital when you’re working in a “market rate” job whilst house prices and rents increase faster than salary? Poor reasoning. What kind of capital do you need to raise to have any chance of having it contributing towards a life? £100,000? £1,000,000?
You take on more responsibility, volunteer to do extra things. You spend your own time learning additional skills to improve your worth to the company and your marketability to competitors etc.That way you can add more value and get paid more etc.
John145 said:
ClaphamGT3 said:
Indeed - profits distributed to the investors who have risked their capital and the executives who have delivered performance IS the right direction.
Staff are paid a market rate for a job done. If they want a bigger slice of the pie, they have two choices; they can either pony up some capital and invest in the business or they can progress their career to the point where they are senior enough to contribute materially to the organisations performance and be rewarded accordingly.
Where do you build up capital when you’re working in a “market rate” job whilst house prices and rents increase faster than salary? Poor reasoning. What kind of capital do you need to raise to have any chance of having it contributing towards a life? £100,000? £1,000,000? Staff are paid a market rate for a job done. If they want a bigger slice of the pie, they have two choices; they can either pony up some capital and invest in the business or they can progress their career to the point where they are senior enough to contribute materially to the organisations performance and be rewarded accordingly.
sidicks said:
John145 said:
Where do you build up capital when you’re working in a “market rate” job whilst house prices and rents increase faster than salary? Poor reasoning. What kind of capital do you need to raise to have any chance of having it contributing towards a life? £100,000? £1,000,000?
You take on more responsibility, volunteer to do extra things. You spend your own time learning additional skills to improve your worth to the company and your marketability to competitors etc.That way you can add more value and get paid more etc.
Edited by John145 on Wednesday 20th December 09:07
ClaphamGT3 said:
If an individual genuinely can't raise capital then they can take the other route and progress to a level where they can participate in a meaningful performance-based incentive schem. As Blueg33 rightly says, this can be an exposed position in a house builder. In my experience, more people will invest very modest capital in leaving PAYE employment and becoming sole-traders. This gives them the opportunity to control earnings more and choose to either enhance their income or to invest capital in growing a business - or a combination of the two.
Uhuh. So the best way to make the population better off is have everyone self employed. Yup got it.John145 said:
Imagine every one of permissons employees did that. Literally everyone one went the extra mile, gave that bit more. The CEO would get a bigger bonus. Join the real world.
In the real world, only a few are prepared to make that sacrifice and they are the ones that improve themselves, move up the ranks, and in a few cases, become CEO.John145 said:
ClaphamGT3 said:
If an individual genuinely can't raise capital then they can take the other route and progress to a level where they can participate in a meaningful performance-based incentive schem. As Blueg33 rightly says, this can be an exposed position in a house builder. In my experience, more people will invest very modest capital in leaving PAYE employment and becoming sole-traders. This gives them the opportunity to control earnings more and choose to either enhance their income or to invest capital in growing a business - or a combination of the two.
Uhuh. So the best way to make the population better off is have everyone self employed. Yup got it.John145 said:
I think we should be smart about how we pay this kind of money. Dumping such a large amount of money on, let’s face it, an individual with good ideas whilst holding back the rest of the workforce is equally dumb.
For me it would go into pay rises, not bonuses. It’s nice to have a bonus, it’s better to have the security of a salary whilst using the lump sum of cash in investing in staff for the long term.
Like I said, it doesn’t look to have been a particularly well thought out scheme in this case.For me it would go into pay rises, not bonuses. It’s nice to have a bonus, it’s better to have the security of a salary whilst using the lump sum of cash in investing in staff for the long term.
It’s very difficult, though, to come up with a bonus scheme that achieves what it is meant to. If bonuses are small, say £100-500 at Christmas, then whether you make them flat across the firm, or base it on performance, you get unhappy staff. If you ramp it up to a few thousand you can make it worse, as someone ends up resenting their co-worker’s nicer house or car based on them getting the “wrong” amount.
If you ramp it up to City banking amounts then it used to be a bit easier, as people to some stent viewed it as academic, they were doing more than fine anyway, and the extra would be going into a pension; worth having, but not life changing now.
Even here it’s getting harder though. London housing prices mean that a guy on £200k basic and £200k bonus is unlikely to be able to afford a townhouse in Islington nowadays, so even there, the difference between a bigger and smaller bonus matters again, and can fuel resentment.
sidicks said:
Pay rises mean you have increased the fixed costs for the future. Bonuses are one-offs.
One of the unintended effects of the bonus cap in banking is that fixed costs have rocketed so now the bank’s can’t slash wage bills in the bad years without sacking staff. Sacking staff and employing others a year later is destructive of value.TooMany2cvs said:
ClaphamGT3 said:
John145 said:
sidicks said:
John145 said:
It’s £20,000 per employee. I wonder what kind of pay rise they saw. It’s very frustrating, in the business I just left they were making £30,000 profit after tax per employee yet gave a tiny 2% pay rise.
Do the employees own the business?Staff are paid a market rate for a job done. If they want a bigger slice of the pie, they have two choices; they can either pony up some capital and invest in the business or they can progress their career to the point where they are senior enough to contribute materially to the organisations performance and be rewarded accordingly.
John145 said:
Where do you build up capital when you’re working in a “market rate” job whilst house prices and rents increase faster than salary? Poor reasoning. What kind of capital do you need to raise to have any chance of having it contributing towards a life? £100,000? £1,000,000?
Overtime, evening work, setting up a small company on the side that takes on work in the hours that you aren’t committing to your current job.Nearly all of these huge companies started out once as one or two people pursuing an idea.
If you aren’t willing or able to do this then you get a fair wage for a fair day’s work. If you want to take the excess value that you get by investing in and building a company then you need to invest in and build a company.
A good friend of mine did exactly this this year. He saved about £20k from living a very, very frugal existence, borrowed the same from his bank, and set up a food truck. He’s doing very well now, and next year thinks he may be able to set up another, running the two with the help of a couple of staff.
You seem to suggest that these staff should,take the same as him if the business does well. I don’t agree, they are risking nothing, and are getting a fair wage for their time and effort. He’s the one that walked away from an accountancy career to try to build a business.
John145 said:
Imagine every one of permissons employees did that. Literally everyone one went the extra mile, gave that bit more. The CEO would get a bigger bonus. Join the real world.
I hate this argument, it is so disingenuous. You may as well tell any athlete that there is no point training hard, as if everyone else also does then no-one is further ahead.Edited by John145 on Wednesday 20th December 09:07
The majority of employees won’t up-skill, and increase their value. Against the background of people doing only what they have to it is very easy to stand out and progress.
You seem to think that the real world is one where you do the minimum but get paid in line with those who really outperform, and who make the difference in a company. That’s fine, you can always dream of a world where people like you get money rained on them, but you really don’t then get to tell others to join the real world.
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