Here's a blog post explaining their approach:
https://www.daily.co/blog/rethinking-levels-promotions-and-s...
Maybe it's not possible to switch from a cutthroat promotion-oriented environment to this, but it's worth thinking about for anyone building up a software engineering workplace.
I guess the main question that comes to mind is “why would a strong-performing, early-in-career engineer want to join?”
In other words, aren’t you capping junior hires to come from the bottom ~60%?
You are going to have a distribution of high and low performers at all levels of experience. If you pay all the senior people the same, you have less money to pay your high performers. And maybe they go get that pay from elsewhere.
There's a difference between having 20 years of experience and one year of experience 20 times.
I don't know if it's always true for people, but my performance goes up and down quite a lot depending on how much I believe in the group mission and the group dynamic. I'll occasionally stay late working for some abstract metric that might impact 10% of my pay, but I'll stay up 48 hours working fanatically to make something work for my friends and co-workers and the dream of success in changing the world that the group is striving for together.
And if that filters out the people that only do software for a princely salary, leaving the people motivated to transform the world for the better, so much the better. Greedy people are a bit demotivating to work with.
But consider that Daily is fully remote, hires globally paying SV-level salaries, doesn't do whiteboard torture interviews, and has an interesting product space where you can make a visible impact. I'd imagine this combination would be appealing to early-career people, especially if they don't live in a FAANG hiring market or aren't set on acquiring that kind of résumé.
> The way we’ve set up our levels, people in the early stages of their careers can get bigger titles and raises more quickly at other orgs than they can at Daily. This will likely be a deterrent to some early-stage candidates, but we are ok with that for now. While we are excited to bring in early-career people once we have the structure to support them, we aren’t there yet, and probably won’t be for a while. We don’t want to make the mistake of hiring high-potential people we then under-serve, especially if they’re from groups typically excluded from tech.
Why do you think you need the top 40%?
At scale it encourages coasting and not doing much until your manager moves on for whatever reason and you have a window into moving up. It also means the Peter principle is in competition with getting promoted while not being very competent.
I think there are specific fields and job where it’s a decent approach, but not at scale and not with salaries tied to promotions.
