Last Updated Jun 20, 2011 6:36 AM EDT
And now what if you suspect that you're being paid less than a coworker who does a similar job? You can't straight out ask your coworker, because that's rude. Your boss will tell you to get back to work and HR will say, "that's confidential information." So, you just keep working with this uncomfortable feeling or you work to gather enough evidence to take to the Equal Employment Opportunity Commission (EEOC).
And when you're job hunting, the companies are silent on what they want to pay someone in this position, but in the meantime, they demand a complete salary history, including your stint as a burger flipper in high school.
What if, instead of all this angst and information asymmetry, we knew everybody else's salary? What if, when you were filling out the application question where they ask what you're expected salary is, you could go to the company's website and see how much the hiring manager made, how much your potential coworkers made and even how much the recruiter was earning. Suddenly, coming up with a reasonable number isn't so, well, unreasonable.
It would become difficult for companies to pay people unfairly because those practices can only survive in the dark.
I know many managers and HR departments would hate it. Every time I advocate more openness in salaries I get emails about how employees just can't handle that information. "They whine, they complain. I shouldn't have to spend all day explaining why Jane makes more money than Horace."
You know what? You wouldn't. If your pay structure is fair and Jane should be making more than Horace, then you can confidently say, "Our pay structure is fair." Horace can go find another job that pays him more if he doesn't like it. But, if it's unfair, you can't hide that any longer. And I suspect that many managers and HR departments know their compensation programs result in unfair salaries but they can't "fix" it.
And why can't they fix it? Because they put policies in place that prevent more than an 5% raise, or some other rule plucked out of nowhere to which they rigidly adhere.
But what about privacy? How would people feel about their information being publicly available? No one would take such a job! You'd be violating our privacy!!!
The reality is that many, many people work in jobs where their salaries are publicly available. Government workers, for instance. In fact, I just did a search on the town I grew up in and looked up the salaries of people I went to high school with. They didn't turn down these jobs because their nosy high school classmates could look up their salaries.
It's a cultural thing. We don't talk about it because it's not polite. But, that also opens the door for unfair pay practices. If you want that to go away, turn on the light and let everyone see.
If pay information was public, companies would face serious criticism when the senior team received 40% bonuses the same day they announce there is no money for annual increases. Could they still do it? Sure. Would the possibility of the backlash be enough to make some of them rethink the practice? I think so.
Would you work for a company that had an open pay practice? What do you think would happen in terms of salaries in your company?
For further reading:
- Who Should Reveal Salary Expectations First?
- How to Avoid Those Salary History Questions
- Why are Salary Ranges Secret?