Pay transparency is another way of saying pay communications.
· Employee’s Question: What is my pay based on?
· HR’s Answer: We base your pay on the competitive total compensation our competitors for talent are paying for a similar job. And we also consider your performance as well as your relevant work experience, education, skills, tenure, and work location. What we are paying other employees doing substantially similar work is also used in the pay decision-making process.
What if HR said this before answering:
· Employee’s Question: What is my pay based on?
· HR’s Answer: Well, before I answer that can you tell me what factors you see being used to determine pay here at Company ABC?
· Employee’s Answer: My manager just promoted a colleague to a higher-level position. My colleague, James, has more than 10 years of experience and has his bachelor’s degree. He is also good at leading projects, and everyone seems to like him.
· HR’s Response: So, that sounds like years of experience, education, and performance on projects as well as getting along with others are what you are seeing be used for promotion decisions. Is that correct?
· Employee’s Response: Yes, that’s what I am seeing. But what is my pay based on?
· HR’s Response: We base your pay on the competitive total compensation our competitors for talent are paying for a similar job. And we also consider your performance as well as your relevant work experience, education, skills, tenure, and work location. What we are paying other employees doing substantially similar work is also used in the pay decision-making process.
You can give answers to questions, or you can create an opportunity for connection and conversation about pay.
In the example above, the factors the employee assumed were used to make the promotion decision were shared with HR. The employee didn’t share a pay related example explicitly, but did share a promotion example.
Explaining your pay decision making process to employees is good.
But making the factors used in the pay decision making process more visible and ensuring your employee experience is aligned to that is better.
#pay #compensation #rewards #hr #humanresources #payequity #paytransparency #communications #conversation #connection #promotions