10

I wonder if someone more qualified than his/her manager can be paid more.

Is it customary/expected and/or a rule stating that a manager should have a better salary than all of their subordinates?

  • 1
    If there is a rule, it is going to vary by jurisdiction (company, country, region), so this should at least have a country tag. – Seth R Apr 1 at 21:33
  • 3
    This is an interesting and relevant question because "managers must be paid more" is the prevalent opinion in some organisations. – P. Hopkinson Apr 2 at 11:17
  • @Abigail How do you know? – Bernhard Döbler Apr 2 at 14:10
  • 1
    Depends on what you are working. If you sell cars and get a bonus per car sold, you can earn a lot money. – Bernhard Döbler Apr 2 at 14:11
25

I've had managers that had little to no technical knowledge. They were paid for the value they provided -- the ability to manage people. That skill may not be as in demand as other skills, so they're paid accordingly.

I see no issue with a highly skilled person being paid more than the person they report to.

10

No, in fact I know people who make more than their managers.

It is important to remember that just because someone is a manager does not make them better or more valuable than the people that report to them. It's just a different position, with different required skills. Those skills could be more or less valuable than the skills of the people reporting to them.

Salary is nominally based on the amount of value created by the skills someone has and who hard they would be to replace, not by their position in the organizational structure.

6

I manage a technical group. 15 years ago I decided I liked managing people and enabling them to do great things more than I enjoyed doing research. I’m quite happy to have technical people making more than I do. It means they are doing great things, and that I’ve done my job well.

5

To expand on the other good answers here. It shouldn't be a rule but...

Is there a certain rule that manager should have better salary than all of his subordinates?

Yes.

This rule/myth originates from managers but is believed by a significant number of people in all positions. Even if it isn't a good rule you should be aware that it exists in parts of the real world. Adherents to the rule are usually resolute and are not ready to be persuaded that anything else would be fair or even viable.

Therefore, if you meet someone who believes in this rule you should think about how you can work around it rather than trying to change their minds.

Sometimes the rule will be believed by a manager (work around them not against them) but sometimes it will be intrinsic to an organisation. For example, the NHS has a pay banding structure predicated on the idea that managers are paid more than their employees*. If you want sizeable long term pay rises and also want to work for the NHS then you should try to obtain a role and responsibilities that can have the word "manager" attached to them.

* with the sole exception of doctors (1% of NHS employees). Doctors are valued differently but I don't want to get into details too much as the specifics aren't relevant to the question at hand.

  • One way that organisations predicated on this belief handle being able to hire non-managers with high salary expectations is to split off teams of higher-paid people led by a higher-paid manager, so that they'll earn less than their manager, while still earning more than most managers in the organisation. Still less practical than just paying people what they're worth regardless of heirarchy, but a frequent workaround. – Bruno Apr 3 at 6:41
1

Salary is usually based on two factors:

  • Position

  • Time at Company

There are engineers at my company who have been here for 20+ years and they make a lot more than engineering managers that have been here for half the time (or less depending on team). While managers usually make more money than their subordinates because of the simple fact that you need to be at a company for a while to "work your way up"- newer managers will typically make less money than subordinates that have been at the company for longer and have top titles (and more time for those lovely raises/bonuses)

  • 5
    Compensation of skilled employees has more to do with availability of applicants and the employee's skill level. Managing a team of surgeons may pay much less than being one of the surgeons for example, regardless of position or seniority. – Jacob M. Apr 1 at 22:31
1

The question is how much you benefit the company and how replaceable you are. If you are the only person in the world capable of doing your job, and there is a queue of people who could replace the manager, then there is no reason why you wouldn’t get paid more.

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