In decades past, salary has traditionally been a sensitive subject. Family members and coworkers alike have often kept their earnings close to the chest, considering salary a private financial matter. However, there has been a recent push to overturn this secrecy that is gaining significant traction in some professional circles.
Known as salary transparency, the idea is not to keep information on who makes what in a company, but to make it publicly available. Driven largely by the free availability of information on the Internet, as well as a larger general social awareness of things like pay equality, this transparency is quickly making the shift from exception to rule.
What can you see through salary transparency?
If the idea of having your salary available to your boss, your coworkers and even the general public sounds counterintuitive, you're not alone. Many companies have wrestled with identifying the value of salary transparency, worried that its effects would only be negative. However, organizations that have taken the leap have reported some unexpected and encouraging results. Perhaps the biggest positive effect of sharing pay information, according to the Society for Human Resource Management, is that it can inspire greater trust in the company. A company that is transparent with its pay scales is implicitly stating that it has nothing to hide from its employees, which can better foster the feeling that the organization is looking out for its workers.
Similarly, as wage gaps and equal pay continue to grow in the mainstream public consciousness, salary transparency can be a useful tool for rooting out potential examples where these archaic practices are still in effect. In fact, there are some tech startups that have dedicated projects designed solely to make the sharing of salary information easier. A survey conducted by Challenger, Gray and Christmas surprisingly found that salary transparency was more popular among HR services than expected – nearly 42 percent of those surveyed indicated that providing publicly accessible salary ranges across departments was a good way forward.
How can companies navigate this change?
Taking the leap into the world of full-blown salary transparency can seem like a frightening proposition for small-business owners. If publishing the earnings of employees conjures up frightful images of discrimination suits, disgruntled employees and administrative nightmares, there are services that can help smaller companies reap the benefits of this new trend without having to struggle through the legal issues alone. HR outsourcing companies are a valuable resource that can bolster a company's existing HR solutions without having to spend more money on in-house services.