Why it pays to talk about pay transparency
- 3 Min Read
Talking about pay used to be a taboo, but not any more. The trend now is to be much more open – and that openness brings substantial benefits to those who adopt such an approach.
For a long time pay has been a secret subject; a topic which simply wasn’t talked about openly. Employers didn’t want to encourage disputes, limit the scope for negotiation, or see vital employees poached by rivals offering more. That’s changing fast.
Since 2014, pay transparency content shared on Linkedin has grown by 136 per cent. According to our Global Talent Trends Survey 2019, it’s now rated as one of the top for transformative trends by 53 per cent of talent professionals. From almost complete silence to one of the most talked about topics: why has this change in pay transparency come about?
For one thing, because many are finding out that the benefits of talking about pay far outweigh the negatives. Being more open helps with both morale and retention. Left in the dark, the assumption which grows is that a person is underpaid – never the other way around. Openness clears up misinformation and speculation. Job candidates know what to expect from the outset. Finally, it also sends a clear signal about fair pay right across race, gender and all other demographics, and so builds trust between employer and employee. In short, talking about pay is actually more likely to be good for everyone.
So how do you move from silence on salaries to encouraging a more open environment? Here are seven steps your organisation can take.
How do you stack up?
Conduct an audit. How does your organisation compare to others across gender, race and employees in similar roles? If there are inequalities, fix them.
How transparent is transparent?
There are lots of ways to be transparent – do you publish salary ranges or exact salaries? You need to decide what is best for your organisation and get executive buy-in before you do anything else.
Ask your employees
Nothing will succeed unless your employees are onside. So let them know what you are proposing to do and why. Collect their feedback via different channels and share their concerns as widely as possible, from anonymous surveys to live Q&A sessions.
Have clear compensation criteria
From past performance to years of experience, many things will influence your decisions on pay. So you have to ensure that you can address all employee questions as to just how you’ve reached the decisions you’ve reached. Make sure you do this before roll out.
Train managers to talk about pay
Pay can still be an awkward subject to talk about. Ensure that managers have the training to answer questions and clearly explain your approach to transparent compensation policy.
Take one step at a time
Don’t try to roll everything out at once. A phased, step by step approach will allow you to manage the transition more smoothly. So decide on the key stages you need to introduce – from sharing plans to training managers – and the timescales you’ll use to roll out your transparency strategy.
Communicate at every step of the way
Keep talking and make sure employees have all the details they need as you roll out your policy. Tie the policy to core company values – honesty, integrity, diversity, accountability. Demonstrate how these are all re-enforced – and in turn themselves reinforce the rationality behind your move towards greater transparency.
To find out more, and discover just how companies such as Starbuck and Care Here have made transparency work for them, download our Talent Trends Survey 2019 now, and find out just how pay transparency could change your business.