Salary transparency is a hot topic at the moment, with more and more people calling for their place of work to publish information regarding pay and benefits. However, a lot of employers are (understandably) still on the fence.
Talking about how much you earn is often seen as inappropriate, and the thought of salary transparency makes many feel uncomfortable. However, some companies are taking the plunge, believing that being open about pay will create a positive work environment.
The Benefits of Salary Transparency
Increase Employee Happiness
Very few companies are open about salaries, but those that are tend to have much higher levels of employee satisfaction. Anecdotal evidence has suggested that knowing how much your colleagues earn and why encourages productivity and motivation.
Build Brand Reputation
Companies that share their rate of pay and salaries with their employees and the public are more likely to be viewed as fair and inclusive. They can show that they treat their staff well, which will also result in higher levels of employee retention and acquisition.
Encourage Equal Pay
Sharing information about salaries is a big step towards achieving equal pay within a company, which is a legal requirement. By being transparent about pay, employees will feel empowered and confident knowing that they are being paid the same amount as colleagues at the same level as them.
"Sharing information about salaries is a big step towards achieving equal pay within a company, which is a legal requirement."
The Drawbacks of Salary Transparency
Potentially Cause Workplace Conflict
Salaries are a sensitive topic, and transparency only works if you have a very clear policy in place. For example, if salaries are not equal amongst all employees of the same level, issues will arise.
To avoid this, make sure that your team knows how salaries are determined as well as what different people in the company earn and why. This way they can feel assured that they are being compensated fairly.
Final Thoughts: Should We Be Transparent About Pay?
Salary transparency can massively lessen discrimination in the workplace, as well as increase staff happiness and company image. However, it comes with its own issues in terms of disrupting the workplace and so it is important to have a clear strategy in place for making the transition and implementing salary frameworks for true transparency.
