Someone recently asked me what I thought of transparent salaries. I hadn't thought much about the topic, so I did a little research. Penelope Trunk recently set off a spate of blogosphere chatter when she argued that salaries should be made transparent.
It turns out there are a number of benefits:
- Employees can better assess their value to a company
- Workers can exert more leverage when asking for a raise
- Public salaries can help eliminate a gender gap in pay scales
- Bloated executive compensation can be scrutinized
- Obvious and unfair disparities can be brought to light
The IRS recently decided to make 990 forms for non-profits available online, thus revealing exactly what officers, board members, and "key" employees are taking home. (The NFL and trade groups are fighting that decision.)
A number of Web endeavors, notably Glassdoor, Payscale.com, and Salary.com, are hanging their business hats on the premise of making wages a matter of public discourse. And in Europe, some countries are posting their citizens' tax returns online; Norway, in fact, saw its gender gap in salaries decrease markedly since the information went public in 2002.
But there's still a built-in reticence among American workers when it comes to discussing salaries openly. People who'd gladly tell you the details of their gall-bladder surgery blush when the talk turns to income. And while workers might gossip over the water cooler about who makes what, most of them won't gladly volunteer their very own salary secrets.
There are also some reasonable arguments for keeping salary information under wraps. If you're bringing in a new employee at a slightly higher rate than your current staff, for whatever reason, there's bound to be grumbling if it comes out. There's also the privacy issue; do you really want everyone to know what you make, even if it's a fair rate? It can be an interpersonal minefield as well. Finding out that your colleague earns more -- or less -- than you can affect both a friendship and a working relationship.
What's your take on the debate?