On the company website Buffer’s finance team describes the salary formula as a LO4

“work in progress”, and it has gone through three versions in four years.

(a) What are the advantages and disadvantages of regularly updating and finetuning the salary formula?

(b) When the salary formula was created, and each time it was revised, it was done in such a way that each employee’s salary was guaranteed either to increase or stay the same. Was that a wise decision? If so, why?

(c) If you were on Buffer’s finance team, what would be your primary concerns about the salary formula? Can you recommend any improvements to the formula to address those concerns?