Over the last few days, we’ve seen the Internet basically blow up over the story of Talia Jane, a customer service representative for Yelp who wrote an open letter criticizing her CEO, Jeremy Stoppelman, for being underpaid relative to the high cost of living in San Francisco.
Much has been said about Talia Jane herself, about how workers like her deserve an honest day’s pay for an honest day’s work or how she’s a spoiled, entitled millennial who has no idea how to budget her money. But this post won’t touch on whether it actually made sense for her to move to the most expensive city in the United States with a liberal arts degree and no plan. Rather, this will talk about Yelp and what might’ve gone wrong with them engaging their obviously underpaid customer service representatives, and how low wages in expensive cities also affect employee satisfaction.
In her post on Medium, Jane basically asserts that her fellow employees are no better off than she is, and that things are really, really bad. These include:
- Employees who are unable to afford their own expenses, and as such are forced into all sorts of living arrangements. These range from living with parents to nearly ending up homeless.
- High employee turnover and low employee retention rates, with new faces popping up each week.
- An unresponsive management, with input not listened to.
Whatever our opinions may be about Jane, it appears that Yelp is suffering from problems with their customer service representatives. For a large, successful Silicon Valley startup, the last problem you want is with your employees.
Employee satisfaction is often driven by many factors, some innate to the company you work for. Studies have shown, for example, that employees are less likely to be happy when their income is below $75,000 a year, but Jane made San Francisco’s minimum wage ($12.25/hour), which is nowhere near enough. Sure, they had benefits, but they still lived paycheck to paycheck and weren’t happy. Employers in turn suffer from that unhappiness as low pay translates to higher employee turnover, lower productivity and larger costs for retention and training, as opposed to employers that pay higher wages.
At the same time, employee satisfaction is more than just giving more money to employees. Jane felt that she had no choice but to write her open letter because Yelp’s management didn’t listen to her suggestions for improving her workplace. It isn’t clear exactly whether she complained through appropriate channels or not (all we know was that she tweeted Stoppelman, then wrote the letter sometime thereafter), but if management didn’t act on what may have been legitimate concerns and/or suggestions, it asks the question: just how engaged were their employees, and this lack of engagement reflect in their lack of employee satisfaction?
It has to be stressed here that employee satisfaction has to be taken seriously, and the welfare of your workers should always be your company’s top priority. After all, happy employees lead to happy customers. But at the same time, we understand that it can be difficult to make everyone happy especially in an extremely expensive city like San Francisco. While it has been suggested that Yelp will expand its customer service operations in more affordable Phoenix, Arizona, some may feel that they wouldn’t want to move. When that happens, it’s imperative that your employees have options for staying put but still being involved in the company, or be given strong incentives to move.
Now that the dust has begun to settle around Talia Jane’s letter, it’s only fair to point out that the discussion over unsustainable wages and spiraling living costs in America’s most expensive city ought to be an ongoing dialogue between employers, employees, government and civic society. They should work together to alleviate the crisis. But at the same time, we must consider that maybe, just maybe, if you really want to keep high-quality talent in the city, you have to pay that premium even if they’re for jobs that supposedly even a high schooler can do it.
Bay Area salaries are often a tale of contrasts. On the one hand, you have highly-paid software engineers and startup founders, with many a number of “techbros” out there who feel that the success of their venture relies heavily on being at the center of all the action. But on the other hand, you also have your lowly janitor, bus driver, teacher or, yes, customer service representative who barely make ends meet. Comment what you will, but this is a serious conversation that we will eventually need to have.