Ricardo Semler on Compensation

How Semler eliminated Fredrick Winslow Talyor

Through many years of practice and looking back on history, Semler and his colleagues devised the most natural way to work together.

Employers began hiring workers by the hour during the Industrial Revolution. Their reasons were simple and rapacious. Say you ran out of cotton thread at 11:30 in the morning. If you paid people by the hour, you could stop the looms, send everyone home, and pay only for the hours actually worked.

You couldn’t do such a thing today? The law probably wouldn’t let you. The unions certainly wouldn’t let you. Your own self-interest would argue strongly against it. Yet the system lives on. The distinction between wage-earning workers and salaried employees is alive but not well, nearly universal but perfectly silly. The new clerk who lives at home and doesn’t know hot to boil an egg starts on a monthly salary, but the chief lathe operator who’s been with the company 38 years and is a master sergeant in the army reserve still gets paid by the hour.

At Semco, we eliminated Frederick Winslow Taylor’s segmentation and specialisation of work. We ended the wage analyst’s hundred years of solitude. We did away with hourly pay and now give everyone a monthly salary.

About the Author

Jeremiah Josey is Chairman of MECi Group and a systems architect specialising in energy infrastructure, advanced technology, and large-scale industrial projects. He bridges visionary thinking—from artificial intelligence and sociocratic governance to ancient symbolism and climate science—with hands-on execution across China, the Middle East, including Türkiye, the Arab states and Iran, as well as Australia. Some of his initiatives include IPRI.Tech and The Thorium Network. He helps principals and decision-makers make complex, politically sensitive projects bankable and executable. His approach combines data-driven clarity, consent-based systems design, and deep structural insight to drive rapid growth, operational excellence, and transformative impact. Learn more at MECi-Group.com