the hidden currency of the workplace
Some videos almost guaranteed to go viral: wild animals that collect food from unsuspecting families, cars that go through the windows of crowded cafes, pilots trying to land planes in high winds. Some of them are less obvious candidates to be ricocheted around the internet. Take, for example, the case of Brittany Pietsch, whose recording of a call in which she is fired from a tech company called Cloudflare went viral last month.
The recording lasts nine minutes, features none other than Ms Pietsch and includes words such as “performance improvement plan”. Despite these unpleasant ingredients, it reveals a moment of human drama that could happen to almost any worker. It also appeals to basic human instinct. Whatever the rights and wrongs of Ms Pietsch’s dismissal, the manner in which she was fired, in a summary call with two people she had never met before, seems unfair. and for reasons that are not properly explained. And few things are more important to people than fairness.
In experiments where one person decides how to allocate a pot of money to another, recipients consistently reject an offer if they feel they are getting too little, even although that means neither party gets any money. A fair share is more important than free money. Equity is important in non-financial life as well. A 2012 study by Nicholas Wright of University College London made some participants thirsty by hooking them up to a salty drip; they would still refuse offers of water from fellow participants if they felt they were being offered too little.
With the emphasis that people place on fairness, it makes sense that managers should think about it too. Because questions of equity arise almost everywhere in the workplace – not just when people lose their jobs but also who gets hired, who gets the credit when things go well and who has that really nice desk by the window.
Equity is not just the responsibility of employees. Last month, a judge in Delaware ruled against Elon Musk’s outrageous compensation package at Tesla because it was unfair to shareholders. A recent study of CEO compensation from Alex Edmans of the London Business School and his co-authors found that bosses also care about equity. Money is not just about what it can buy; CEOs believe that it is only right to be rewarded for better performance, and to be paid according to their peers. A sense of fairness can be responsible for increasing the pay of bosses and fueling anger about it at the same time.
Customers appreciate fairness too, especially when it comes to pricing. Consumers instinctively accept the idea that prices would rise in response to growing demand, whether it’s for Uber fares on a busy night, face masks in a pandemic or shovels snow the night after a big storm. Insights like this are very profound. A recent paper by Casey Klofstad and Joseph Uscinski of the University of Miami asked Floridians for their opinions on anti-price tag legislation that would prevent stores from raising prices after a hurricane. Even when told that economists and other experts believe that mandatory price ceilings would worsen shortages and cause store closings, respondents supported the law. (Depending on your point of view, this either proves that the public is irrational or that economists are not human.)
More often than not, opinions differ. The covid-19 pandemic, for example, has drawn a new dividing line between people who can and do work from home regularly, and those who have to come into offices and workplaces on due to the nature of their work. For many, this corrects an old imbalance: the option to work from home allows single parents to more easily combine childcare and work. For others, it reinforces existing inequalities: workers with poorer skills unfairly tend to be the ones with no choice in where to work.
This combination of transparency and content makes equity a difficult area for managers to navigate, but not impossible. No hiring decision will be fair if qualified workers do not know that work is going on; a survey of 3,000 job seekers by Gartner, a research firm, in 2021 found that half were unaware of internal career opportunities. No cancellation will feel fair if it is too impersonal; Cloudflare at CEO they agreed that Ms. Pietsch’s manager should have been on the call in which she was fired. Even if people differ on what counts as a fair result, they can usually agree on what constitutes a fair process. That is more than half the battle.■
Read more from Bartleby, our management and work columnist:
Jürgen Klopp and the importance of energy (January 29)
Why You Shouldn’t Quit (January 25)
Companies run to their own annual rhythms (January 18)
Also: How Bartleby’s column got its name