What is fairness between shareholder and worker?

[Cleffa]

I'm not sure if I'm a socialist but I often think why do the shareholders do nothing but still get money while we workers work our *** off but have to share some of our profits to the shareholders.

Assuming everyone wants to be fair and no one wants to take advantage of others. Everyone wants to get what they deserve.

Let's say a shareholder is the person that has the capital to own or rent the place to do the business, eg. factory, store, office, etc. As well as providing the necessary equipments, parts, and ingredients for the business.

The worker is the person that provides labour and or services and or knowledge to make money.

Then the income would be the total amount of money made by the worker, eg. the total cups of coffee sold, or the total amount of money made in a restaurant, or the total amount gained through selling the finished products to the buyers.

The cost would be the rent for the factory or store or office assuming market price even if the shareholder owns the place. As well as equipment costs, cost of parts, cost of ingredients, electricity, water, and basically every cost that makes the income possible (like the network from the shareholders to get cheaper ingredients, parts, etc).

Now deduct the income from the cost we get the profit. Now is it theoretically fair that the workers should get all the profit? Since all the capital that has been paid by the shareholder has been deducted from the income since all the profit reflects the effort and hard work from workers assuming shareholders didn't join the workforce, the profit should all be given to the workers right? Why in real life do workers only get their salary and the rest goes to shareholder's pocket (assuming profit is positive and total salary < profit and tax is included in costs)?

On the other hand, I'd say because shareholders bare risks and the money they deduct from workers is the money they should get through baring risks.

Then does it mean when profit > total salary (good times or good economy) every body wants to be shareholders because they don't have to put effort to work and still can get money from workers.

On the other hand when profit < total salary, everyone would want to be workers?

But then the shareholder is a human too and has basic needs. He needs money to survive but he doesn't work and only invest hoping to gain a piece of the profit. I'm confused in this loop please enlighten me.

 

[Reverend Rick]

The share holder worked hard to get the capital to invest. The share holder might be someone saving for retirement. The shareholder may not make any money at all and may even lose their original investment.

I'll tell you what, what if the employees had to come to work every day and at the end of the week they do not get a paycheck until the company turns a profit?

What if the company is sucessful they get a bigger share and if the company loses money they need to write a check to their employer?

Would you be good with that?

You act as if the share holder has never worked a day in their life.

You do understand how retirement works right? You save and invest.

One day the employee will have saved money of their own and another generation can be the employees and complain about the arrangement.

I've never understood why a person would apply for a job, agree to the wages, and then complain about the deal they made with their employer.

 

[Kilgore Trout]

Don't waste your life sitting around waiting for life to become "fair" - whatever that means.

 

[Reverend Rick]

Don't waste your life sitting around waiting for life to become "fair" - whatever that means.

No crap. If an employee works hard and becomes invaluable to a companies success, they should get a raise.

If the employer is unfair, the employee should look for a better job.

I know if I have good people working for me, I want to keep them happy.

If they do the bare minimum, I don't care if they walk, maybe I will get someone better.

 

[Reverend Rick]

This life is suppose to be fair crap is the problem when we give every kid an award growing up.

Life is not fair, but some day you might be able to turn things around in your favor.

 

[Kilgore Trout]

This life is suppose to be fair crap is the problem when we give every kid an award growing up.

Life is not fair, but some day you might be able to turn things around in your favor.

People who experience no hardships growing up never develop the use of many important muscles. It's sadly ironic that people who shelter and coddle their offspring think they're doing them a favor.

 

[Reverend Rick]

People who experience no hardships growing up never develop the use of many important muscles. It's sadly ironic that people who shelter and coddle their offspring think they're doing them a favor.

It is a rude awaking for them. I remember when I first got into construction, I had the worst job and made the least money.

After 20 years, I did the least and made the most. The thing is, being foreman, if someone did not come in, guess what? What ever their job was became my job that day.

If your going to be a leader, you have to set a good example.

 

[Terrywoodenpic]

I would like to see every employer required to pay a proportion of wages in shares. (say 1%)

After a few years it would be clearly in the workers interest for the company to do well.

I would also make it a rule that a workers shares could only be sold to fellow workers.
Eventualy workers would hold enough share votes to elect board members.

 

[Iti oj]

The share holder worked hard to get the capital to invest. The share holder might be someone saving for retirement. The shareholder may not make any money at all and may even lose their original investment.

I'll tell you what, what if the employees had to come to work every day and at the end of the week they do not get a paycheck until the company turns a profit?

What if the company is sucessful they get a bigger share and if the company loses money they need to write a check to their employer?

Would you be good with that?

You act as if the share holder has never worked a day in their life.

You do understand how retirement works right? You save and invest.

One day the employee will have saved money of their own and another generation can be the employees and complain about the arrangement.

I've never understood why a person would apply for a job, agree to the wages, and then complain about the deal they made with their emplofyer.

because the system forces people i to jobs

 

[Sunstone]

Even chimpanzees have a sense of fairness. Apparently, it goes with being social animals.

 

[Reverend Rick]

because the system forces people i to jobs

I cannot understand what you just said.

Who forces anyone to take a job? You do realise if everyone would not work and hold out for more money you would get paid more right?

Employees set wages by accepting them. Would you work for 25 cents an hour?

 

[Kilgore Trout]

Even chimpanzees have a sense of fairness. Apparently, it goes with being social animals.

If only more people were like chimps.

 

[Reverend Rick]

If only more people were like chimps.

There are some jobs out there that would be better serviced by chimps

 

[4consideration]

I would like to see every employer required to pay a proportion of wages in shares. (say 1%)


Wow, so a company with, say 100 employees could not hire any more. It would be really unfair to ask employees that were given shares of a company forcefully taken from the owner to have to give up shares that now belonged to them. Don't you think?

Oops, never mind, you don't believe that anyone has a right to private property in this scenario. So, by your own logic, the employees don't have any right to anything, either. Just take it. You took it from the owners.


After a few years it would be clearly in the workers interest for the company to do well.


It is already in the workers interest for the company to do well. If you don't realize that, please don't work for any company that I work for. If someone convinced you to view your employer as your enemy, they have done you a great dis-service.


I would also make it a rule that a workers shares could only be sold to fellow workers.
Eventualy workers would hold enough share votes to elect board members.

___________________________________

That is nice that you would not allow the shares to be sold to anyone outside of the group that got them by force in the first place. I think the workers should vote infinite time off, triple salary increase -- what the heck, let's quadruple them.


And, you know what, it's unfair that they should have to show up and follow any kind of rules, either. You could vote in a retirement plan for everyone once they reach age 21, too.

 

[OMEGA777]

Ec 11:1 Cast thy bread upon the waters: for thou shalt find it after many days.

I made $42,000 dollars by buying PPI Potash at .17 cents and selling it at $1.50 .

I took an Educated Gamble and prospered by asking others about the company.

You must be a Good Stewart with God's Gold.

Hag 2:8 The silver is mine, and the gold is mine, saith the LORD of hosts.

Lu 16:9 And I say unto you, Make to yourselves friends of the mammon of unrighteousness;
that, when ye fail, they may receive you into everlasting habitations.

Lu 16:8 And the lord commended the steward, because he had done wisely:
for the children of this world are in their generation wiser than the children of light.

Lu 19:23 Wherefore then gavest not thou my money into the bank,
that at my coming I might have required mine own with usury?

Ec 9:11 I returned, and saw under the sun, that the race is not to the swift, nor the battle to the strong,
neither yet bread to the wise, nor yet riches to men of understanding, nor yet favour to men of skill;
but time and chance happeneth to them all.

 

[Cleffa]

The share holder worked hard to get the capital to invest. The share holder might be someone saving for retirement. The shareholder may not make any money at all and may even lose their original investment.

I'll tell you what, what if the employees had to come to work every day and at the end of the week they do not get a paycheck until the company turns a profit?

What if the company is sucessful they get a bigger share and if the company loses money they need to write a check to their employer?

Would you be good with that?

Agreed. Most workers would rather have fixed wage than risk whether they're going to make profit or not.

You act as if the share holder has never worked a day in their life.

Nope but I just don't think the work they put when they were working in their early life relates to the income the company makes assuming the shareholder didn't join the workforce. We are talking about the income made today, it doesn't matter how much work the shareholder has worked previously in their life. Today he/she is the shareholder and has 0 work and all the effort such as capital investment, networking with trade partners, etc, is included in the cost.

You do understand how retirement works right? You save and invest.

One day the employee will have saved money of their own and another generation can be the employees and complain about the arrangement.

I've never understood why a person would apply for a job, agree to the wages, and then complain about the deal they made with their employer.

Theoretically, is the value of shareholder = income (with shareholder) - income (without shareholder)?

 

[Reverend Rick]

You take fast food workers for instance. Some areas pay 12 or 15 dollars an hour while other places pay eight.

Why do you suppose that is?

 

[Cleffa]

You take fast food workers for instance. Some areas pay 12 or 15 dollars an hour while other places pay eight.

Why do you suppose that is?

hmm I think I figured it out but correct me if I'm wrong...let's consider an even simpler example, a barber shop. And the only service is cut, no perm, no colour, etc to make things simple. All the worker needs is a pair of hands, a pair of scissors, and the skills and these are all provided from the worker.

Let's say the worker works for 10 hours from 10am to 8pm. And there's only one price per cut, which is $10. The wage is $15 an hour.

The place where the worker is indifferent between using hourly wage or gaining all the profit for a day is:

10n - rent = 150 where n is the number of cuts and rent is a fixed cost.

Eg. if rent is 100 per day then worker would prefer gaining all the profit if n > 25 because if they are paid in an hourly wage the $10 made from the 26th customer is to the shareholder and not the worker. But if the worker cut 24 customers the shareholder would fire the worker because they are making a deficit. So their optimal n=25. But if all the profit is to the worker, they would work as many customers as possible to make as much profit. And the shareholder gains the rent only.

Therefore in fairness, the shareholder should give all the profits to the worker and only gains the rent for a living. Then n really depends on the market renting price. And if the worker can't cover the renting cost, then like what you said, the worker has to pay the deficit to the shareholder through the rent, which is fair. But this is a motivation for the worker to work and at least cover the renting cost so he/she doesn't have to make a deficit.
If using a wage system, the only spot that's fair is for the shareholder to make zero profit.

 

[Terrywoodenpic]

4consideration

Originally Posted by Terrywoodenpic
I would like to see every employer required to pay a proportion of wages in shares. (say 1%)


Wow, so a company with, say 100 employees could not hire any more. It would be really unfair to ask employees that were given shares of a company forcefully taken from the owner to have to give up shares that now belonged to them. Don't you think?

Oops, never mind, you don't believe that anyone has a right to private property in this scenario. So, by your own logic, the employees don't have any right to anything, either. Just take it. You took it from the owners.


After a few years it would be clearly in the workers interest for the company to do well.


It is already in the workers interest for the company to do well. If you don't realize that, please don't work for any company that I work for. If someone convinced you to view your employer as your enemy, they have done you a great dis-service.


I would also make it a rule that a workers shares could only be sold to fellow workers.
Eventualy workers would hold enough share votes to elect board members.
That is nice that you would not allow the shares to be sold to anyone outside of the group that got them by force in the first place. I think the workers should vote infinite time off, triple salary increase -- what the heck, let's quadruple them.


And, you know what, it's unfair that they should have to show up and follow any kind of rules, either. You could vote in a retirement plan for everyone once they reach age 21, too.

You are plainly unaware that one of the largest and most sucessful companies in the UK is run this way. ( John Lewis Partnership) It was one of the few companies to make gains over the Christmas period.

The entire share stock is owned by the employees.

It is now government policy to encourage/increase this sort of fair capatilism.

 

[4consideration]

You are plainly unaware that one of the largest and most sucessful companies in the UK is run this way. ( John Lewis Partnership) It was one of the few companies to make gains over the Christmas period.

The entire share stock is owned by the employees.

It is now government policy to encourage/increase this sort of fair capatilism.

______________________________

You did not say that you thought it was a good idea. You said that you would support making it a requirement that every employer provide a portion of stock to employees, in addition to wages.

There is a big difference between choosing to do something and having it imposed upon you. What works well for one company may not work well for others.

I would be happy to discuss theories of what may work better for improvements to any system. But, when a person takes a position that because something seems to be a good idea, and because it can be shown to have short term benefits, that means it ought to be imposed upon other people, I have to strongly disagree.

There are plenty of businesses that offer profit sharing to their employees. It can be a great incentive. However, forcing such an idea is forcing a principle that completely disregards a person's (or company's) right to make decisions regarding their own private property.

If the owners of a company do not have a recognized right to the profit from the investment of their money, there is a strong arguement that can be made that employees also do not have a right to the investment of their labor, and therefore, do not have an inherent right to their wages. Do you support forced labor? (I don't think so. Me neither.)

I believe your argument for such requirements being imposed upon companies is taking things in a bad direction.

When you support ideas that infringe upon the rights (property or otherwise) of other people, simply because you are not part of that group, it is important to understand that the very same principle can legally be applied to you in the future.