Money Matters

What If It Were Illegal to Keep Your Co-Worker’s Salary Secret?

(Source: www.inc.com)

One of the things that I loved about being an HR data person was knowing how much money everyone else made. My very first HR job was as an HR admin for the head of compensation, and I got to run reports for her, which meant I knew everyone’s salaries, including hers and my co-workers’ (who, incidentally, were much higher level than I was and had no idea about one another’s salaries).

For various reasons, I’ve always needed full access to compensation information (in one job, I even got to approve my boss’s raise, so I knew her raise before she did), and I loved it. For two reasons. One, I’m inherently nosy. (Oh, stop being so self-righteous. You are too.) But the other reason was I always knew my salary was fair.

I never had to fret, “Was Jane being paid more than I was, even though I worked harder? Was John hired at a higher rate, even though we are supposed to be the same level?” It was awesome. I knew my pay was fair.

Most of the rest of you aren’t that lucky. And it’s that lack of knowledge that allows discriminatory or just plain dumb salary problems to continue. What you don’t know, you can’t sue about, right? 

Quartz recently wrote about a year-old law in Germany that you can find out what your opposite-gender co-workers earn, on average. Woo-hoo! Salary transparency for the win. (You can read the brochure about this new law, but it’s in German.) You can’t see which co-worker earns what, but you can see the average male salary and the average female salary.

Except it’s not quite the panacea it’s made out to be. First of all, only companies with more than 200 people are required to comply, and to get a report on your co-workers’ pay, there has to be a minimum of six people in the position.

That means if you’re a grocery store cashier you can easily get a report that gives you meaningful data. But the higher up you climb, the less likely you are to have six people doing the same (or even a similar) job. How many staff accountants and how many marketing analysts does any single 200-person company need? Even back when I worked for a company with 30,000 people, my jobs were often unique or had only one other person in a similar role.

Additionally, averages only tell you a little. They don’t take all the variables into account, like performance and experience. When I could see all my co-workers’ salaries, I could also see their day-to-day work and knew about their experience. You don’t see that in an average.

The other problem is that the wage gap isn’t really about discrimination. It’s about choice. Men are more likely to choose dangerous jobs or jobs with long hours while women are more likely to choose flexibility and indoor jobs.

While I think it’s good practice to be more open about salaries, I wish governments didn’t feel the need to step in to force businesses to do something that will make their employees better off.

What I’d like to see is a different law. One that says if you make your compensation data available to all employees, then you’re immune from wage discrimination lawsuits. If your boss knew you could see your co-workers’ salaries, you can bet she would be more motivated to ensure they were fair. Right now, with our culture of secrecy around money, it’s easy for companies to be sloppy with salaries.

A little sunlight would solve a lot more problems than a law that doesn’t provide meaningful data for most professional employees.

More Info: www.inc.com

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