Tech City: ‘Open salaries make employees feel more valued’
PUBLISHED: 07:00 14 December 2015 | UPDATED: 09:11 14 December 2015
Tech City is the third largest technology hub in the world, and it’s right on our doorstep. Each week, we bring you news from the thriving area around Old Street roundabout. This week, reporter Sophie Inge talks to the co-founder of GrantTree, Paulina Sygulska, about the benefits of an open salary policy in the workplace.
Salaries are still a taboo topic in most workplaces, but the co-founder of GrantTree insists that her employees feel happier and more valued since she introduced an ‘open salary’ policy.
Not only are the staff fully aware of exactly what everyone else makes, but they are also able to increase – or decrease – any salaries.
Paulina Sygulska, whose company in Tech City helps other businesses secure government funding, decided to implement the daring policy last year.
Every six months, a rotating ‘salary committee’ – five volunteers from the 30 employees – decides on the salaries of their colleagues. Of course, it’s not completely arbitrary: the volunteers must base their decisions on market rates in the industry and what the company can afford.
The results, says Paulina – who founded GrantTree with her husband Daniel Tenner – have been overwhelmingly positive for staff as well as clients.
“When we’re open about salary and financials,” she explains, “it creates a stronger sense of transparency among us which extends out to our clients. We’re honest and transparent with each other, making us honest and transparent with them, too.”
One of the most positive consequences, she says, is that staff tend to feel more valued.
“The ‘open salary’ is a great way to ensure our team recognise and know their value and the value of their work to our clients. A valued team is a much happier team – not just to be a part of, but for our clients to work with when filing claims.”
Moreover, she says, by giving the team power to set their salaries, “we nurture an entrepreneurial spirit and a sense of responsibility that makes them better placed to understand the high-growth, very entrepreneurial businesses we work with.”
The ‘open salary’ policy is just the latest she and her husband have adapted as they try to establish an open culture at the company.
From the beginning, they decided to make the company’s accounts accessible to everyone so that employees knew exactly what the company was spending money on and how much everybody else was getting paid.
“The big taboo that exists in most other companies was completely broken,” she says.
They decided to shake things up three years ago when the company had a team of five and company was just two years old.
“There were five intelligent, capable people in the company, and it felt a little like we were all pushing in different directions,” she says. “There was no way in which we organised our work. So we sat down together and decided to do something about it.”
At the time, they were working with a corporate coach who gave them advice on how to construct an organisational chart, establish a clear hierarchy, and reporting lines. But somehow this just didn’t feel right.
“Daniel and I said to each other that we didn’t want to create the kind of company that we wouldn’t want to work for in the first place.”
Instead, they opted for a non-hierarchical structure based on trust, allowing their employees to self-manage. All staff could implement their own decisions, just as long as they receive feedback from the people who will be affected.
As the company continued to grow, the couple realised they had to devise a more effective way of benchmarking salaries and making them more fair for everyone on the team, which is where the salary committee came in.
“That was a very brave thing for us as founders to do, because we effectively gave control to the salary committee,” says Paulina.
Since they introduced the policy, the company has experimented with different financial models for pay – so quite a few people’s salaries have gone slightly up or down.
Finally, the company settled on a model that takes into consideration two factors: people’s experience and level of impact within the business and the level of uncertainty and responsibility they have to deal with on a daily basis.
Even Paulina herself has seen her own salary go up and down – and it now hovers at around £70,000 a year.
“Each time, I thought: ‘Isn’t it amazing that someone is taking that level of responsibility, and I’m not the only one that has to think about these things!’”
Now in its sixth year, GrantTree has a turnover of £2 million and has helped more then 450 businesses benefit from more than £22 million of grant money.
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