Question

Some people argue that it is wrong for CEOs to earn multimillion-dollar salaries while some of their employees are earning the minimum wage or even being laid off. Some suggest that a firm's top earner should earn no more than 20 times what the lowest-ranked employee earns. Please write 1000 words

Answer 1

A top earner in an organization on the first hand should not be compared with the lowest earning member since the skill set of both the employee's are different.

For instance let us consider a CEO of an organization and an apprentice. CEO of the organization is responsible for ensuring continuity of business and overall operations. While in the case of an apprentice they don't have to worry about anything else apart from executing the task or work assigned to them. A student passed out from college cannot become a CEO unless they have the knowledge and experience.

When an organization suffers from financial crisis, the first thing they would do is to lay off high salaried people or reduce the salaries of higher rank employees since they are aware that that reduce will significantly contribute to reduction in operational expenses. Employees whose absence does not impact the organization will be laid off while key resources will still be retained.

It is not appropriate to compare a CEO with the least ranked employee since both are incomparable.