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Board of Director Compensation Some experts argue that a corporation’s board of directors should be paid only with stock options. What do you think? Exempt or Non-Exempt Remind us of your ideal future career. In that role, would you prefer to be compensated as an exempt employee or a non-exempt employee? Why or why not?

Minimum Wage What are your thoughts on the minimum wage? Should the federal minimum wage be increased? If it were solely up to you, what would you increase the minimum wage to, and why? Pay Secrecy Do you want to know how much your coworkers earn? How eager are you to tell them how much you earn?

Is pay secrecy a valid management tool to prevent jealousy and morale problems, or is it an unfair practice that hides discrimination and ineffective compensation policies? Who is best served or protected by the practice of pay secrecy?

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Introduction
Executive and employee compensation remains one of the most debated topics across business, economics, and human resource management. Questions about how corporations compensate their boards of directors, how employees should be classified as exempt or non-exempt, whether the minimum wage should be increased, and whether pay secrecy is ethical all reflect deeper tensions between fairness, competitiveness, and organizational strategy. The purpose of this essay is to evaluate these issues through research, applied reasoning, and professional insight. Each topic is examined in depth with supporting evidence from scholarly work, economic analysis, and organizational behavior literature. Ultimately, compensation practices must balance equitable treatment, economic sustainability, organizational culture, and legal compliance to foster both productivity and fairness.

Board of Director Compensation and Stock Options

Some compensation experts argue that board members should be paid exclusively with stock options rather than cash or mixed compensation packages. Proponents of this idea claim that stock options fully align the board’s interests with those of shareholders by giving directors a direct financial incentive to increase company value. Research supports the notion that equity-based compensation can reduce agency problems by motivating directors to focus on long-term company performance rather than short-term metrics (Bebchuk & Fried, 2004). Stock options also reinforce accountability, as directors personally experience the financial consequences of poor governance or strategic decisions.

However, compensating directors solely with stock options has significant drawbacks. Exclusively equity-based pay may create excessive risk-taking incentives. Studies have found that when executives and directors receive disproportionate equity compensation, they may push for aggressive growth strategies, mergers, or financial practices that elevate risk to maximize perceived shareholder value (Devers et al., 2007). This model can also conflict with corporate governance reforms that stress independence and objectivity—directors who are too financially tied to performance may become less willing to challenge management.

A balanced compensation strategy that includes a combination of cash retainers, equity, and performance-based incentives appears to be more effective. This approach encourages responsible oversight, long-term value building, and independent judgment. Therefore, while stock options should remain part of director compensation, they should not be the sole form of payment.

Exempt or Non-Exempt Compensation Preference

My ideal future career involves serving as a senior-level consultant, project manager, or executive within a technology-driven or business management environment. In such roles, I would prefer to be classified as an exempt employee. Exempt positions typically allow more autonomy, flexibility, and responsibility—characteristics essential for leadership and strategic roles. Exempt employees are salaried and not eligible for overtime pay but often receive other forms of compensation such as bonuses, professional development opportunities, and performance incentives. Studies have shown that exempt roles are more closely associated with career advancement, higher levels of job satisfaction, and leadership growth (SHRM, 2021).

However, the preference varies by occupation. In positions that are labor-intensive, require rigid schedules, or involve extended hours, non-exempt classification may be more beneficial due to overtime protections. The Fair Labor Standards Act ensures that non-exempt employees are compensated fairly for excess labor. For my future goals—requiring strategic decision-making, project leadership, and flexible work structures—exempt status remains most appropriate.

Views on Minimum Wage Increases

The federal minimum wage in the United States has remained at $7.25 per hour since 2009, despite significant increases in the cost of living. Economic research overwhelmingly suggests that the current minimum wage is insufficient to support even a modest standard of living (Cooper et al., 2021). Adjusted for inflation, the minimum wage has effectively declined, reducing purchasing power and widening income inequality.

Yes, the federal minimum wage should be increased. If it were solely up to me, I would advocate for a federal minimum wage of $15 per hour. This figure aligns with cost-of-living analyses and is supported by numerous studies indicating that moderate increases in the minimum wage do not significantly harm employment rates (Dube, 2019). Furthermore, states and cities with higher minimum wages—like California and New York—have not experienced widespread job loss but have seen reductions in poverty and improved economic stability for low-income households.

Critics argue that higher minimum wages hurt small businesses or lead to automation. While these concerns hold some truth, research shows that gradual increases allow businesses to adjust while improving employee retention and productivity (Reich et al., 2020). Ultimately, increasing the federal minimum wage would support economic fairness and reduce reliance on government assistance programs.

Pay Secrecy: Ethical or Harmful?

Pay secrecy refers to workplace policies restricting employees from discussing their compensation. Historically, organizations have used pay secrecy to maintain managerial control, avoid conflict, and prevent salary disputes. However, pay secrecy is increasingly viewed as an outdated and harmful practice.

Do I want to know how much my coworkers earn? Yes—transparency fosters fairness, accountability, and trust. Am I eager to tell others how much I earn? Perhaps selectively, but employees should have the right to discuss compensation without fear of retaliation. Research suggests that pay transparency reduces wage gaps, increases motivation, and discourages discriminatory pay practices (Bamberger & Belogolovsky, 2017).

Pay secrecy often hides discrimination against women and minority employees. According to the National Women’s Law Center (2021), secrecy policies make it harder for workers to identify unfair pay disparities. Transparency also encourages employers to implement more structured and equitable compensation systems.

Who benefits from pay secrecy? Employers who seek to maintain unequal pay or minimize accountability. Who is harmed? Employees—especially women, racial minorities, and newcomers unfamiliar with negotiation dynamics.

Overall, pay secrecy serves as a tool for concealing inequity rather than maintaining morale. A healthier alternative is structured transparency: sharing pay ranges, explaining compensation criteria, and allowing open discussion without requiring individuals to disclose private details.

Conclusion

Compensation is a multifaceted issue that affects organizational effectiveness, employee well-being, and economic justice. Board members should receive diversified compensation rather than stock options alone. Exempt versus non-exempt status depends on career goals, with exempt roles offering more autonomy for leadership positions. The federal minimum wage should increase to reflect modern living costs, and pay transparency should replace secrecy to ensure fairness and accountability. Compensation in all these forms reflects not only economic values but ethical commitments to equity, dignity, and responsible governance.

References

1. Bebchuk, L., & Fried, J. (2004). Pay without performance: The unfulfilled promise of executive compensation.
2. Devers, C., et al. (2007). Executive compensation and risk-taking. Academy of Management Review.
3. SHRM. (2021). Exempt vs. non-exempt employee classifications.
4. Cooper, D., Gould, E., & Zipperer, B. (2021). Why the minimum wage should be raised. Economic Policy Institute.
5. Dube, A. (2019). Minimum wages and labor market impacts. ILO Review.
6. Reich, M., Jacobs, K., & Bernhardt, A. (2020). Effects of minimum wage increases. UC Berkeley Labor Center.
7. Bamberger, P., & Belogolovsky, E. (2017). Pay transparency and organizational justice. Journal of Applied Psychology.
8. National Women’s Law Center. (2021). Pay secrecy and wage discrimination.
9. Gittins, R. (2020). Wage fairness and transparency research. Australian Economic Review.
10. Kuhn, P., & Shen, K. (2019). Do wage transparency laws close the gender wage gap? Journal of Public Economics.