Sunday, 29 April 2012

Indecency stretched to the limit

Some of the readers of this blog know my name and surname; some of the readers know where I work and what position I hold. For the rest of the world, I try to appear as an anonymous ex-student of economics, employed by one of “Polish” banks. Rationale for concealing my identity? A down-to-earth reason is that I need publicity like a hole in the head and generally tend to avoid situations when the world revolves around me. The other motive cropped up out of the blue in 2010, when I had to familiarise with some of the internal policies (containing several dos and don’ts) set out by the corporation I work for, including the blogging policy.

At first glance it seems absurdly silly that a company may require its employees to stick to regulations concerning limitations in blogging, but if a company wants to avoid adverse publicity from its employees, maybe this is the case. I plead I haven’t learnt by heart all the drivel written there, but I keep in mind that: 1) as an employee I can’t write anything about my company nor my job (event if doesn’t involve letting in on any secrets) and sign it with my name, even if I don’t mention the name of my employer, 2) as an anonymous Internet user I don’t have to refrain from mentioning my employer’s name but I’m not advised to spread negative opinions about its business. So to comply with all the regulations there’s no author’s name, nor a company name.

If someone wishes bad on me, feel free to send link to this post to the HR department of my company. This would surely help bring forward the inevitable bitter end of the shattered relationship between by employer and me. Anyway I would appreciate if you let me put myself out of this misery on my own and only after I find a better place, which is not that easy, hence I soldier on…

This might be a matter of corporate culture. They vary across the world and companies and models of socio-economic order. In American companies direct relationships, hire-and-fire approach, flexibility and opportunities to climb the ladder of career quickly are quite typical. You can like it, or detest it, fit in, or struggle to find your way inside a specific business. But is decency, a backbone of moral fibre, a part of corporate culture? Back in 2008 when several banks at the verge of bankruptcy had to be bailed out from taxpayers’ purses, executives’ bonuses and salaries outraged everyone. Do you remember where cries of anger were the loudest? These were the United Kingdom and the United States, not only because deregulated banking industries have grown too big too fail there, but also because (Bank executive’s salary / average salary in the national economy) multipliers in Anglo-Saxon countries were incomparably higher the in more civilised countries.

Many times I’ve asserted on this blog I’m glad I live in Poland, not in the United States. I also stressed the soundness of Polish banking system, prudently managed, wisely regulated and lacking depravities typical for developed investment banks. My general take on the Polish commercial banking has not changed. I still hold it as a whole in high esteem, there are just some exceptions that prove the rule…

One of the differences between Polish and American banking is a position of banks and its employees in the national economy. Financial sector in Poland is not a significant contributor to wealth creation as in Anglo-Saxon countries. Moreover, Polish commercial bankers, unlike their colleagues from investment banks, are ordinary people who don’t earn zillions and whose conduct is usually governed by moral principles, not only by pursuit of profits.

In Anglo-saxon investment banking, weaselling into the industry was (is?) one of few ways to grow rich quickly and legally (this doesn’t imply ‘in morally acceptable way). In Poland, if your expertise is above-average, you can count on above-average earnings, but don’t expect appallingly high salary. In investment banking, profits are distributed between: executives, employees and owners, the rest of the society and the state do not benefit from their activity. In Poland these are only executives and (foreign) owners that reap profits from banks’ activity.

To cut this long considerations short, I’m getting at the question whether a company can prosper at the expense of its employees? How long can you exploit workforce before they show you their middle fingers and quit? How big gaps between executives’ and rank-and-files’ remunerations are acceptable? Bigger responsibilities and higher qualifications must mean the higher your position, they higher your earnings must be, this is natural. Only the size of disproportion in earnings can be a matter of a dispute. How should employees’ contribution to a company’s prosperity be rewarded?

The other story is how executives participate in an austerity programmes they pursue in their companies. I know one company which has been more or less successfully turning around for a while. It has changed its strategy, pulled out from unprofitable business lines, laid off over 10% of its staff and continues to terminate contracts with employees. This year to show financial standing of the company is improving and to appreciate the contribution of employees to this success, most of the staff were granted a 10 PLN before tax pay rise. Getting it? Ten zlotys minus income tax, even too little to get hammered in despair! Some people who heard about it told it was a joke, I call it a slap in the face, especially if from the annual report of that company (quoted on the stock exchange) you can learn that its executives remunerations have increased by 30 – 50%. Pay rise of 10 PLN vs. pay rise of 1,000,000 PLN – just fair? This remuneration model is a sort of ‘privatising profits and socialising losses’.

The answer to the question I asked in a civilised world must be ‘no’. On a properly functioning market best employees would refuse to put up with such uncivilised treatment and would flee to work for competitors. Things aren’t so simple when labour market in a specific industry is characterised by over-supply of workforce – this is visible in Polish banking. A good banker will find a job, but room for salary negotiations has shrunk…

Not long ago my opinion on activity of trade unions was similar to this espoused by Mrs Thatcher. I thought trade unionists were spongers with endless unfounded pay rise demands, paralysing growth of businesses. I still see many times they act with detriment to their companies, but where I work things look much different. In pathological situations, such as described above, trade unions are the only organisation capable of standing up for indecently treated employees. Oddly enough, trade unions’ bargaining power is bigger in companies where employees are treated well…

Much has changed since I wrote my summary some three months ago (not only the temperature which is now some 50 degrees higher than then). I have been assigned more duties and given more responsibilities. This has upsides – new challenges, learning & development opportunities and downsides – no measurable reward in return. With each next week I feel more encumbered and less motivated. With a bold face I face new challenges take up more tasks, try to complete them all, but seeing to appreciation of my efforts I can’t see my future where I work. I’ll grind my teeth and wait until I hit two-years’ experience as an analyst, after which I’ll be fulfilling all the criteria in most job openings. Best people I work with are on the lookout for better places to work. If they quit, there’ll be no reason to stay in, and without them this ill-run boat will sink. I’m worried about the number of fatalities, but given the way it is managed, it will meet a well-deserved fate.

So bitter… Am I getting acrimonious?


DC said...

"Oddly enough, trade unions’ bargaining power is bigger in companies where employees are treated well…"

Or is it maybe "Employees are treated better in companies where bargaining power is bigger." Still it's always a balance - abuse of power by unions is just as damaging as bad management. And there are plenty of non-union employers that are rated highly as providing a great place to work, at least in the US.

Sorry things suck for you right now. But your willingness to question nearly everything so openly is making your blog a great read right now, especially having read some of your earlier posts. It seems like there is a lot going on with you and I look forward to the next installment.

student SGH said...

Thanks DC, maybe it's indeed the other way round.

So much's going on, and complicated goings-on reach far beyond aspects of work.

Take care!