Berry Algorithm

Collabberry's Compensation Algorithm is designed to ensure fair and transparent remuneration for contributors by combining monetary compensation with team points (a token customizable by your organization to represent shares, governance rights, future compensation or whatever you want), reflecting both individual contributions and team dynamics.

The inputs to Collabberry's Compensation Algorithm are the foundational data points and parameters needed to calculate fair compensation for contributors.

• Contributor Agreement:

  • Market Rate per Month: The standard salary for a given role, what is the desired and agreed reference that the labour market would pay for the proper skills and expertize of the contributor.

  • Percentage Commitment: The agreed-upon time commitment, so if the industry standard is 40 hours/week, a 50% commitment would require the contributor to work 20 hours/week..

  • Monetary Compensation per Month: It’s the actual cash payment that the contributor and the organization agrees to pay as a salary considering the stated percentage commitment.

  The Algorithm would work then with a calculated Monthly Base Salary tha multiplies the Market Rate multiplied by Commitment.

• Assessment Scores:

  Each given period of time (can be set by the organization, e.g. weekly, bi-weekly, monthly, etc.) contributors will asses their co-contributors with two different score classes:

  • Work Contribution Score: Evaluates if the individual has fulfilled their work commitments and role expectations.

  • Culture Impact Score: Assesses the individual's positive influence on team culture.

• Performance Adjustment Rate (PAR):

  It determines the extent to which a person's salary in teampoints can be adjusted based on assessment scores. Suggested default is 20%.

• Points Multipliers:

  Contributors teampoints salary will also have a multiplying factor that might depends on the following two variables:

  • Time Contributions: Reflects the value a person brings through their work.

    • Default is 2x, increasing by 0.125 every 6 months until year 8, capping at 4x.

  • Material Contributions: Applies when someone invests money, hardware, or similar resources.

    • Default is 4x.

  Compensation Algorithm Design

  The Algorithm Design defines a structured approach to calculating contributor compensation by assigning them team points that can be then considered by the organization to distribute shares, governance weight, dividends, or even a Christmas bonus compensation. By combining performance assessments with predetermined metrics, the algorithm ensures that contributors are rewarded fairly for their efforts and commitment.

  This system integrates peer feedback to evaluate individual performance while providing a clear framework for distributing compensation. It emphasizes measurable outcomes and alignment with agreed-upon expectations, creating a transparent and scalable model that supports both individual contributors and team objectives.

  Step 1: Calculate Average Score for Each Contributor

  To evaluate contributors, we calculate an Average Score based on feedback from their teammates:

  • Work Contribution Score: How well they deliver on their responsibilities and commitments.

  • xºCulture Impact Score: How positively they contribute to team culture.

  The Monthly Average Score is the average of these two scores.

  Step 2: Determine the Salary Adjustment Multiplier (SAM)

  This step adjusts a contributor's salary based on their performance.

  • Formula:

    SAM = (Average Score - 3) × Performance Adjustment Rate

    • The baseline score of "3" represents a neutral performance.

    • If the score is above 3, the salary increases. Below 3, the salary decreases.

    • Example: With a Performance Adjustment Rate of 10%:

      • Score of 4: SAM = (4 - 3) × 10% = +0.1 (10% salary increase).

      • Score of 1: SAM = (1 - 3) × 10% = -0.2 (20% salary decrease).

  Step 3: Calculate the Adjusted Salary

  The adjusted salary is calculated using the SAM from Step 2.

  • Formula:

    Adjusted Salary = Base Salary × (1 + SAM)

    • Example 1:

      • Base Salary: $1,200

      • SAM: -0.2

      • Adjusted Salary = $1,200 × (1 - 0.2) = $960

    • Example 2:

      • Base Salary: $9,000

      • SAM: +0.2

      • Adjusted Salary = $9,000 × (1 + 0.2) = $10,800

  Step 4: Allocate Team Points for Contributions

  Contributors are rewarded with team points for time and material contributions:

  • Time Contributions:

    • Points are earned for unpaid portions of monetary compensation.

    • Multiplier starts at 2x and grows by 0.125 every 6 months until it caps at 4x after 8 years.

    • Example: If a contributor is unpaid $1,000, they earn 2,000 team points at the 2x multiplier.

  • Material Contributions:

    • Points are earned for direct investments like money or equipment.

    • Default multiplier is 4x.

    • Example: A $1,000 investment earns 4,000 team points.