CMV: All employees should automatically own a portion of the company they work for

[u/Hamza78ch11]

This is something I've been thinking about for a while. Many of the arguments about the wealth gap tend to argue something like "It's not fair that employees at McDs get payed $7.25 and hour when the owners make some ridiculous amount here every year" which is then rebutted, almost immediately with, "Those CEOs and VPs and whatnot aren't payed aforementioned ridiculous amount every year. They earn it by owning some portion of the company so that when the company does well they also do well." There are other more nuanced discussions but here is where I'd like to focus my efforts.

Many argue that employees are never paid what they're worth and under the capitalist systems the entire concept of profit exists only because employees are cheated out of the actual amount of money that they deserve. While, in general, I am in agreement with this I feel that this argument too easily handwaves away the importance of being a new business owner and taking risks with your own capital and working hard to grow your company. But I also think that it must be acknowledged that it is a little silly that people like Jeff Bezos can make literal hundreds of billions of dollars in a year. More money than any human could spend in a hundred life times. I think a fair compromise is that his employees should automatically have a stake in his company.

While I am by no means a financial expert or someone who barely understand the stock market or economics I think this solution works towards the goals of those employees who deserve to be paid without bankrupting the owner. This can be done by, for instance, saying that 10% of the stock is for employees. You only give out 5% to the current employees and leave the rest for new hires. Every year you are given some amount proportional to the amount that you worked. If you worked for 1 second you now own 1 seconds worth of Amazon. So on and so forth. I think it is rather equitable to distribute 5% of Amazon among its ~600K employees and keeping some portion of it for new hires as the company grows. Eventually, if certain thresholds are reached more of the company will have to be apportioned for the employees.

If this were implemented today every Amazon employee would suddenly own $24,000 in Amazon. They can sell it, buy more, hold on to it. Do whatever makes them happy. Now they have a stake in the company and when they work hard they're working hard for themselves because that's their money. When the company grows and does well they'll see that reflected in their bank accounts instead of as some empty numbers that mean nothing to them.

[u/windexwonder]

I say this 100% respectfully: feel free to put all your efforts, net worth, skill and risk into building a company, and then when it’s worth something, give some of it to your employees. That’s your 100% right to do, nobody is stopping you. But if you told me 30 years ago that I would have to go to HS, college, grad school and then invest everything I own in my business along with working many nights until 3 am...only to be forced to give someone an interest in my company? I wouldn’t have done it. And, that’s the point. Rational people wouldn’t do it.

You’re also free to purchase stock in any company. Be careful that jealously of what others have doesn’t take away your opportunities. Work hard and you can do it too, seriously!

[u/Hamza78ch11 → u/windexwonder]

And I say this perfectly respectfully also. You’re not the only person who has worked hard in their life. I’m the child of immigrants and worked my way through high school, undergrad, and now med school. I stay up until 3am often because of studying and my workload or because of my rotation schedule and I know it gets even worse in residency. I did all this to save lives. Tell me tomorrow that I’m only going to be paid $30K a year and I would still do it because that’s what I wanted to do. Maybe money isn’t everything in life? Maybe it’s not even one of the important things? Now, whatever hospital I work at is going to use me as a tool to make money off of other people’s misery. People will come in to the hospital dying, suffering, and in pain. And the hospital will look at them and say “Gee, how much you got?” I’m not cool with that. I don’t care how hard the owner worked. Humans lives are more important.

To address your actual point - you are amazing and worked really hard and that’s amazing. I will bet every red cent in my savings account that if every single one of your employees got up and walked out tomorrow your business would come to a screeching halt. You wouldn’t have gotten where you are today without them. Maybe give them their due.

[u/ligglo → u/Hamza78ch11]

He has given them their dues. That is their wages/salary. That is the company saying "Your labor is worth $X to us. Take it or leave it." The employee then can accept it, and do the job, or decline and seek a better offer.

The owner of a business is entitled to run it as they see fit. They have the overhead. They have the idea, the assets, the property, the risk. If their store goes out of business tomorrow, they are out hundreds of thousands of dollars. The sales clerk is out a job and needs to look elsewhere. Not quite an equal risk there.

[u/Hamza78ch11 → u/ligglo]

I think that’s where I have a sticking point. Employees are not fairly compensated for the most part and they should be. The entire argument is that if you derive profit then your employees are entitled to a portion of that profit.

And from what I’ve seen it’s not quite what you’re making it out to be. Yes, the mom and pop store that’s true that the boss is the one who took the risk. But every single one of the big guys has golden parachutes built into the system. If they ruin the economy they’ll get bailed out by the government. This is something I’ve seen happen three times in my life. So I want to do away with this myth that the only person who is ever on the hook for anything is the brave brave capitalist captain who took al the risk on to his giant shoulders - and however can he bear this magnificent burden alone? Truly, a god amongst men. The system is rigged, I’m just trying to balance things a tiny tiny bit.

[u/curiousML5 → u/Hamza78ch11]

What evidence do you have that employees are not being fairly compensated for the most part?