To help address the issues of inflation and competitive salary pressures on the compensation of core contributors, we propose implementing a payroll adjustment for their salaries. This adjustment will ensure that their salaries continue to be fair, given the changes in the cost of living over time and more responsive to competitive compensation.
Inflation is a natural phenomenon that results in a general increase in prices over time. This means that, without adjustments, the purchasing power of a fixed salary will decline as the cost of goods and services rises. By implementing an annual payroll adjustment, we can help to ensure that the salaries of core contributors are adjusted to keep pace with inflation. This will help to maintain the purchasing power of their compensation and ensure that it remains fair and adequate.
Determine the rate of adjustment: In order to implement an appropriate adjustment, we propose reviewing the rate of inflation on an annual basis. Traditionally, this is done by calculating the average annual rate of change in the price level of a basket of goods and services that are commonly consumed by core contributors. YoY, USD inflation sits at 7.7%, Euro inflation at 10%, and GBP at 13.2%. In our case, these three currencies are considered since the majority of Inverse’s core contributors live in Europe and the United States. We will consider the rate of inflation to be the greatest of the three and round it up to a whole figure, 15%, which also captures certain competitive salary pressures.
Calculate the adjustment: Once the rate of inflation has been determined, the adjustment can be calculated by multiplying the rate of inflation by the current salary of each core contributor. For example, if the rate of inflation is 15% and a core contributor currently earns a salary of $120,000, their adjustment would be $18,000 (15% x $120,000 = $18,000).
Implement the adjustment: The adjustment can be implemented by adding it to the current salary of each core contributor. For example, if a core contributor currently earns a salary of $120,000 and receives an adjustment of $18,000, their new salary would be $138,000.
Review and update the adjustment annually: To ensure that the adjustment continues to adequately compensate core contributors for the impact of inflation, we propose reviewing and updating it annually. This will ensure that it remains fair and adequate, given the changes in the cost of living over time.
Inflation can have a significant impact on the purchasing power of fixed salaries, and this is particularly true for core contributors who play a vital role in the success of our DAO. By implementing an annual adjustment, we can ensure that their compensation remains fair and adequate, given the changes in the cost of living over time. This will help to maintain the purchasing power of their salaries and ensure that they are adequately compensated for their valuable contributions. Ultimately, offering competitive compensation rates and retaining talent is in the best interest of the DAO.
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Refresh the DOLA allowance of the Inverse Payroll contract to 1,000,000 - this is what allows Inverse Finance DAO contributors to be streamed DOLAs for compensation.
Set DOLA allowance of payroll contract to 1,000,000