There’s a never-ending conversation about whether it’s acceptable to discuss pay with co-workers. I’m of the mindset that a person’s pay is their own business. So if someone wants to tell everyone their pay – go right ahead. It’s your information to keep private or share.
I do believe it’s important to realize that sharing your pay isn’t an act of transparency. And it’s often not without consequences.
As a human resources professional, employees would come to me all the time about their pay. And I would have to explain, in logical and realistic terms, why a person receives a certain salary. Compensation is complicated. There are many factors that go into pay. Here’s a post I wrote a couple years ago on developing a compensation plan.
If employees are going to start going out there and telling everyone how much money they make, I think they should also take the time to understand why their pay is set at that level. Then, when everyone decides to share how much money they make over beers at Happy Hour, there can be some understanding why someone might make more or less than someone else. It’s about processing the information in proper context.
Look, employees are going to talk about pay. It’s unavoidable. What’s unfortunate is when employees don’t have enough information about how salaries are established. All employees hear is “So-and-so makes more money than I do.” The employee gets ticked off. No one wins.
So I’d like to make a suggestion. Companies should take a few moments during onboarding to explain how salaries are established. I once worked for a company that proactively told employees “We get salary survey data every year to make sure we’re competitive.” Now, this same company also pointed out getting survey data didn’t mean everyone’s pay was going to get adjusted. It meant they worked hard to ensure salaries were in alignment.
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If employees know how companies establish pay and they know the organization regularly monitors the marketplace, then hearing what other people make isn’t the same issue. I’d like to hear your thoughts on this topic.