CEO of British company tried paying all employees the same salary, experiment failed after 1 year

The company adopted an open salary policy in the end.

Siti Hawa | January 31, 2021, 01:17 PM

Calvin Benton, who set up a psychotherapy company called Spill, thought that paying his employees the same salary would bring harmony to the team.

But he was forced to scrap this model of pay after a year.

The story, which was published as part of BBC's "CEO Secrets" series, detailed Benton's challenges with the scheme, and why he eventually did away with it.

Equal salary of £36,000 a year

Two and a half years ago, Benton founded Spill, which offers counselling and therapy to employees of companies.

BBC reported that when he founded the company, Benton made the decision to pay himself and his colleagues an equal salary.

There were five people in the company at that time, and everyone was "pretty much contributing the same".

Hence, everyone was paid the same amount of money regardless of experience and role.

The amount they decided on was £36,000 (S$65,575) a year for everyone as they had calculated that it was a decent living wage for London.

Problems faced following company's expansion

As the company expanded, and as they tried to hire staff such as software developers and salespersons, Benton shared that he soon ran into problems.

Benton told BBC that software developers are usually very in-demand, so they typically have higher salaries. The company also struggled to attract senior talent for the software role.

As for the salespeople, they are usually paid on commission so the equal-pay model was unsuitable for their role as well.

As the team grew, Benton also noted that the equal pay system began to cause conflict as some team members worked longer hours and felt that they were contributing more than others.

Equal pay system scrapped

After a year, Benton decided to pull the plug on the equal pay scheme following pressure from his staff, replacing it with a traditional structure of pay grades based on seniority in the company and technical expertise.

The company also takes an open salary policy approach, where everyone's salary level is made known.

While Benton expressed disappointment that the scheme failed, he admitted that "sometimes traditional practices are there for a reason".

You can read the full story here.

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