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    Spread of Pay difference between CEO and lowest ranking employee

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    What do you think should be a reasonable spread (either a dollar amount, XX times more than or percentage number) between the earnings of a firm's CEO and its lowest paid hourly workers and why? Provide your detailed explanation on this volatile issue.

    (NOTE: Be careful when using percentages. For example, if the lowest paid employee makes $20,000 and you recommend a 100% higher for the CEO, you are only offering the CEO $40,000, and that really isn't reasonable.) I expect for you to suggest a reasonable spread, using either a dollar amount, XX times more, or percentage amount, and to not simply tell me that it isn't possible to do so!

    NOTE: DO NOT suggest an hourly pay for the CEO, as he/she is a salaried person, as are all management personnel of a firm.

    © BrainMass Inc. brainmass.com October 1, 2020, 11:01 pm ad1c9bdddf
    https://brainmass.com/business/entrepreneurial-issues/spread-of-pay-difference-between-ceo-and-lowest-ranking-employee-254348

    Solution Preview

    There are a few views on this:

    If a CEO wants to be "responsible" then the rule of thumb should be that the CEO earns 50 times more then the lowest paid employee.

    So if the lowest employee makes $20,000, the CEO would make 1,000,000.

    http://www.cypress.com/?rID=34986

    Other views say that the spread should be 25 times. According to this website, if that worker received the minimum ...

    Solution Summary

    The spread of pay difference between a CEO and the lowest ranking employee is determined. The expert determines the reasonable spread is between these two.

    $2.19

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