Wednesday, August 20, 2008

Transparency

I’ve been saying for years that the social stigma about discussing salaries benefits employers and hurts employees. Instead of your salary being a reflection of your worth to your employer, it becomes a reflection of how little your employer can get you to accept. Instead of being valued, you’re being exploited.

When a job listing asks for your salary history, the employer is saying, “I’m not looking for a professional who will help my organization succeed, I’m looking for a bargain.” After all, your salary history has nothing to do with their salary structure. And when listings say to include your salary requirements, and that resumes without salary requirements will not be considered, the employer is looking to start a bizarro bidding war in which the biggest sucker rises to the bottom. If there were truth in advertising, ads like these would list “chump” as the job title.
Professor Lawler has found that most people carry a mental image of where they stand in relation to their fellow workers. Significantly, he said, that image is likely to be wrong. We underestimate what those in positions above us make and overestimate what those in positions comparable to ours make — a surefire recipe for feeling underpaid.

So is the answer for every workplace to tell all? Penelope Trunk thinks so.

Last month, she started a flurry of debate on her blog, The Brazen Careerist (penelopetrunk.com) with a post advocating salary transparency (and in which she conceded that she hadn’t yet laid the groundwork for such a policy at her company).

Her logic was that secrecy about salaries masks inequity. What you are paid should reflect your worth to your employer. Companies should have a range of pay for any given job, and if a worker is at the low end of that range there should be a reason.

Instead, Ms. Trunk wrote, what you are paid more often reflects what your employer can get you for. Skilled negotiators earn more. Employees who are more personable or favored for intangible reasons earn more. So do those who were hired when the manager was either desperate or flush. That results in a salary scale that makes no sense, and leaves many feeling cheated.

[...]

Secrecy favors an employer in hiring. It can be difficult for potential employees to know if an offer is fair if they are blindfolded. In the absence of widespread transparency by companies, Web sites are filling the gap.

“Information is good and more information is better,” said Robert Hohman, a founder of Glassdoor.com, which started in June. Glassdoor allows people to anonymously post salary information, making it one of a growing number of Web sites that list salaries by specific company rather than by general job description.
If I learned that a colleague doing the same job was making more than I was, I would be pissed. Not at the colleague, but at the employer who allowed that inequity to exist. Yet most employers probably would blame, and likely punish, the person who revealed the inequity.

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1 Comments:

Anonymous Anonymous said...

There's a story from when Dorothy Parker, Robert Benchley et al were all working for the New Yorker, whose management reportedly ordered them not to talk about their salaries. So they didn't say a word, but they all wrote their salaries on 3 by 5 cards which they tied on strings and hung around their necks.

8/28/2008 12:09:00 PM  

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