Topic · Leadership & Collaboration
What if salary didn’t reward performance —
but covered need?
New Pay is more than a trend term for “something with transparent salaries.” At its core, it’s about reconnecting compensation with what an organization actually wants to achieve. The needs principle is one of the most radical and at the same time most practical answers to that question — and I helped build it over years as Managing Director of Mein Grundeinkommen e.V.
What “New Pay” actually means
New Pay describes a movement away from fixed salary bands, bonus schemes, and negotiation logic — toward compensation systems that fit an organization’s mission, culture, and decision-making structure. Instead of “What is this position worth on the market?” the question becomes: What does it take for people to work here effectively and feel psychologically safe — and how do we distribute the resources for that fairly?
The answer is never just a tool or a pay scale. It depends on how your organization makes decisions, how much transparency you can hold, and what assumptions about people your model rests on in the first place.
The needs principle in practice
Under the needs principle, salary isn’t determined by position or negotiating power, but by a person’s individual need. Mein Grundeinkommen e.V. developed this model over years — and Neue Narrative documented the process in an in-depth magazine piece that also features me.
External article · Neue Narrative The needs principle: a salary model that fits the organization“Each of us only billed what we truly needed.” Steven Strehl, in the Neue Narrative piece on the early days
What I’ve learned in practice
From nine years with the model — from a freelance setup with seven people to a structured needs-based salary in a growing team — three insights stand out:
- Need is trainable. Most people have never learned to put a number on their actual financial need. Without guidance, you get either understatements out of modesty or overstatements out of uncertainty. A good model asks structured questions and makes reference points visible.
- Transparency is a precondition, not a consequence. Needs-based salaries only work when salaries, budget, and assumptions are out in the open — otherwise the system tips into perceived unfairness. Anyone wanting to introduce New Pay needs to settle the transparency question first.
- The model needs a matching decision-making structure. Needs-based salaries without clear roles and pathways for conflict turn into a permanent working group. It pays to think about self-organization and compensation together.
Teams skip the step of clarifying shared values together and dive straight into spreadsheets and calculation logic. The model ends up technically clean but emotionally rejected. The order matters: first the question of what money is meant to signify in this organization — then the mechanics.
Who this is interesting for
Needs-based compensation isn’t a fit for every setup. It becomes relevant when you…
- …as a purpose-driven organization, notice that your salaries contradict your values.
- …work in self-organization or Holacracy and still decide salary “classically from the top.”
- …are donation- or grant-funded and need to justify compensation to funders.
- …come out of a growth phase and realize the old gut-feeling model no longer holds.
Let’s talk about your salary model.
30 minutes on video — no sales pitch. I listen to where you stand and tell you honestly whether and how I might help.