The recent decision of the Supreme Court in favor of compatriots who worked in Finland was covered in the media on both sides of the gulf and provoked a discussion about the fairness of the wages paid to Estonians. The latter evoked a nostalgic recollection of twenty years of history, when the all-powerful Estonian was told about his incredible hard work, skills, adaptability and a whole chapter about other advantages over spoiled welfare society workers.
The result of the measurement depends on the background system "-" the Estonian was a hero
In the early 90s, an Estonian who toiled for a monthly salary of a few tens of euros, according to today's understanding, was able to "sell" his work cheaper even if he even spent a whole day doing the hourly work of an employee from a neighboring country. Scarcity-ridden, fertile socialist history had taught people to make do with the means at hand, which added universality to cheap labor.
The rise in prosperity reversed the benefits
The wage growth of a good worker has brought us much closer to welfare states in the last few decades. Suddenly, the Estonian's more modest professional education and the skill of combining manual work acquired by fathers-grandfathers during the Soviet era, which is disappearing into history, became apparent. As a result, we find an employee who creates significantly less value than his colleague in a neighboring country with modern tools. In the worst case, there have been damages due to improper handling of tools or damage to the material.
However, the most surprising fact about all this is that the labor productivity of a low-paid person from Maajaland is sometimes so much lower that hiring him does not even pay off for this lower salary.
A fair wage creates benefits
A salary related to the value created as a result of work favors practical employees. In this way, the entrepreneur actually gets more for his wage costs. Of course, the result of all works cannot be measured by money, but in quite a lot of cases it works.
In summary, with the help of a professional accountant, the manager of a company with proper accounting receives management information that helps to evaluate the performance of an individual employee or team. He understands the sources of profit and the places of risk of loss based not on gut feeling but on actual facts.
Is even MOST IMPORTANT
Just a few days ago, I happened to see performance bonuses assigned by a manager to employees that favored the worse performing department. The reason was the evaluation of the result on the basis of only one parameter, which neglected the important circumstances of the creation of profit.
The most important thing is the availability of the right information in the right amount.
If you, as an entrepreneur, lack the necessary information or expert advice, please contact us.