Using Sociocracy for Deciding on Salary Increase

Victor Hugo Germano reports how @lambdatres (a Brazilian Software company) uses a sociocracy process to decide on salary increases every year. Realizing that this will not only make us proud but also is a great example for BOSSA nova we want to share Victor‘s write-up here:


We’ve experimented on MANY ways to make this work, and this is how it is working now: Once a year, everyone who wants to submit a salary evaluation invites their coworkers to a session where they will present a “business review” of their work and a request for approval. It can be really stressful in a Brazilian/Latin culture to talk about one’s achievements and putting together an ask. We are a culture where this simply does not happen, given the strong ties to colonial/patriarchal/command and control roots of our society. It is challenging.


The role of People Operations (PO) is to ensure people feel safe and welcomed to share their work in front of their peers and to make a Salary request. Not an easy task, but an experience that the vast majority enjoys greatly – after it ends 😉 During the meeting (that happens in a metaphorical circle), PO is the moderator and ensures everyone is heard and has their time to speak. First goes the person requesting, presenting work and what they expect to achieve on the next cycle. Then everyone else has time to comment and make observations of the presentation and the general work performance of the requester. It can be a hard conversation, and the facilitator is prepared to allow a constructive and direct interaction, maintaining a level of safety and support to the person. The group goes in rounds making comments and at the end decision based on consent is made. The salary request should is defined (all the numbers are open, and people can speak freely to defend their positions). The decision on this group is taken as final, and the salary is adjusted.


Rules to invite someone to the process:
  • Someone you have worked with collaborated with in the past and have experience with your work.
  • People are incentivized to bring not only their direct coworkers but anyone their work affects.

I only participate in meetings like this for people that work with me, and usually don’t know what happens for others. We, as leadership, decide on the overall “salary increase budget”, without any saying on whats is decided on each specific case we were not invited. Before arriving at this process we had years of experimentation: self assigning salaries, no facilitation, flat increases, and salary tables…. and probably the next cycle will include some experimentation. The process can long and stressful for people and should change somehow.

A culture of feedback and inclusive conversations is a prerequisite to this. And we tend to monitor situations where people feel left out or not treated fairly. After 10 years on this, we are just scratching the surface 😉