The Basics of the Approach
⚠ For those looking for a high-level overview of our approach to compensation, please refer to headers 1-2. For an in-depth explanation, please also read the “Further Reading” section.
1. Starting Salary
At Oyster, we use our own Pay Bands (aka compensation ranges) to establish upper and lower limits on what to offer as initial starting wages.
Pay Bands at Oyster are established through the use of Oyster Band Index (OBI) - our proprietary scoring system we use to calculate which group a country should be in (high, mid, or low) and then where on the group band we should pin a specific country’s benchmark. It determines whether a country is considered a high, mid or low depending on the Cost of Living and other specific country data, and is used to determine which salary data to incorporate into a benchmarking query.
For each OBI group, we aim for the following salary target in the local market, based on our compensation philosophy:
- High OBI - mid market, 50th percentile
- Mid OBI - above mid market, 75th percentile
- Low OBI - top of market, 90th percentile
More about Oyster Pay Bands:
- Geography is a factor, but it isn’t and will not be the exclusive factor as we evolve and determine our band structures over time.
- Where geography is a factor, we further aim to have it be sensibly linked to publicly available economic data on cost-of-living.
- We create and periodically revise these bands by studying our hiring market – the venture-backed technology employment marketplace – continuously and updating the bands on the basis of what we learn.
- We determine the band range by taking the average of available data on all roles in all geographies and set upper and lower limits around that average.
- We consequently neither pay lowest in market nor highest in market. Instead, we will focus on a fair middle ground that maximizes our ability to hire across the widest geographical segments possible.
Geographic pay differences are currently part of market realities, but over time we expect these pay differentials to close in our industry. Thus, over time, we will gravitate toward pay that minimizes location as a factor as the market does so. We also aim to innovate continuously on how we pay fairly across the globe.
2. Equity & Ownership
At Oyster, we believe equity represents ownership potential. It is a “share” literally and figuratively in the ultimate value of Oyster on the basis of the contributions of the role and person. Similar to the above on salary, we have ranges on grants appropriate to function and level but we do not make use of location and geography for determining starting grants.
The ranges allow us some degree of flexibility case-by-case on hiring, but we do not believe that one’s “stake” as a potential owner in Oyster should be determined on the basis of where you live. Rather, it represents what your potential ownership can be given the work you contribute. For that, location is irrelevant.
Two individuals hired at the same time doing the same job in the same department will not, under this model, see much (if any) differences in starting equity grant.
We hope this will be a bold, forward-looking move for Oyster on compensation fairness.