Why Tech Might Embrace Lockstep Salaries


When it comes to salaries, many tech companies embrace a meritocratic approach: “rock star” developers can expect lots of cash and perks, while those with similar experience and education—but who perhaps lack the talent and accomplishments—will make less.

For those at the top of the heap, such meritocracies are ideal. But for everybody else, the knowledge that employees at your level are making vastly greater sums of money can prove an irritant, if not an outright morale killer.

Other industries—most notably the legal profession—have avoided such internal strife by aligning employee compensation to the “lockstep” system, in which everybody is paid solely according to their rank within the company. In this system, it doesn’t matter if you’re a rock-star EVP; you’re still earning roughly the same amount as the EVP in the cubicle next to you.

According to TechCrunch, a selection of tech companies (mostly startups) have been debating whether to embrace lockstep. For those companies, according to the article, the benefits are obvious: “Outside of reduced competition, two other advantages to lockstep are eliminating salary negotiations and increasing transparency.” In other words, internal strife is (hopefully) reduced to a minimum, so everybody can focus on the actual work at hand.

Of course, many tech companies thrive on competition. But leveling salaries won’t automatically make employees complacent if other policies are in place, such as regular reviews to weed out underperformers. The biggest danger facing any tech company that embraces lockstep, it seems, is a rival firm trying to poach star performers with the promise of a gargantuan salary.

3 Responses to “Why Tech Might Embrace Lockstep Salaries”

  1. Joe Shmo

    It’s not just employers, it’s recruiters that are the biggest problem in IT–especially Indian recruiters, along with gatekeepers that have no clue about what employers need.

    In fact, thanks to the offshoring and outsourcing to India, and insourcing of Indians pretty much most of IT has been ruined by managers and others who are obsessed with the bottom line and not quality of work. They want Indians because they think they’re saving money, but the reality is the Indians cannot understand most of what happens in American IT. We spend more time explaining things to them rather than just getting things done. The Indians that are here are only here for the gold rush, not for the work, they couldn’t care less about what they do, they are only here because of the stupidity of the US Congress to continue to allow these unskilled people in because of corporate greed.

  2. Biglaw and the software industry are not remotely related. Biglaw and the bottom 99 percent of the legal profession are not remotely related.

    Biglaw is (mostly) in the very unusual position of having enormous amounts of billable work to parcel out to employees and astronomical rates. The partners make millions, the peasants get recruited out of school, eat lockstep for a few years and then get kicked to the curb. The peasants don’t complain about lockstep because a) the legal job market is horrible and there aren’t any better alternatives b) being trapped in 160k a year salary for 10 years is a great outcome for a lawyer

    This has absolutely no relevance to the tech sector (I’m a lawyer and a software engineer) because software has completely different market dynamics. There’s no barriers to entry, there’s a lot more demand relative to supply and there’s a ton more geographic mobility for engineers than lawyers (no state bar exams, etc). Lockstep won’t work because the unemployment rate for programmers is like 1-2 percent while lawyers are somewhere in the 60-70 percent range (well over 50 percent of law school grads don’t practice). If you implement lockstep in a development shop, all your good engineers will just leave and go down the street.