Do employers who commit to pay transparency need to provide full transparency?

Full transparency is when every employee’s salary is made available for others to view. This isn’t the way to have happier employees or a more productive and engaged workforce.

In Norway there is a policy, and it makes every individual’s salary visible on a searchable online database. 

Do employers have to pay employees the same amount for doing the same job?

No, employers can pay employees differently if they are doing the same job or a job that is substantially similar.

Employers do need to pay employees using the same factors in their decision-making process. And those factors need to be consistently applied from one employee to another.

Some of my coaching clients are leaving their current jobs because of burnout. Others say they want to live a life more aligned to their personal values. And others are starting their job search because they are underpaid and not being appreciated.

When there is uncertainty in a job search about what someone wants next, I often suggest doing an exercise that allows them to discover their personal values.

Choosing a name for a business can be challenging. After writing a long list of ideas, I finally chose Prosper Consulting because I loved the word “prosperity.” It means the condition of being successful or thriving, especially economic well-being.

From that starting point I wrote our Vision and Mission.

They categorize jobs based on internal equity. The number of Career Levels varies by employer and sometimes they are called Job Levels.

They are not the same as pay grades. They are not attached to competitive market data or base salary ranges. This means that jobs with the same Career Level can have different pay grades.

Usually, the Career Levels are assigned to jobs based on a Career Level Guide which is a document that describes the difference between the levels. The Guide provides a standard description, so the use of the levels is consistent across job families.

Today is the first day back to work for many of us after the Memorial Day holiday in the U.S.

 Do you have four days of work expected from you this week or five?

 My guess is five days.

1.      Creates an organizational language and terminology to consistently define and categorize jobs.

2.      Provides a way to effectively communicate career path and total compensation opportunities.

3.      Improves trust and the ability for an employer to attract and retain talent.

Recently, I posted a LinkedIn poll and asked: What factor is most important when deciding what to pay someone?

101 people voted. Here are the results:

50% - Merit / Performance

One of the best ways to mitigate the risk of being laid off is to ensure that your results are aligned to the way your employer defines success.

And then you need to ensure that you aren't humbly keeping those results quiet. Share the impact your work is having on others and the strategic goals your employer is focused on.

I talked to a pay negotiation coaching client recently. It is obvious that his employer is focused on short-term compensation decisions and not long-term compensation strategy and impact.

The employer has more than 2,000 employees but no compensation expert on staff. There are HRBPs, HRGs, HR Directors/VPs, a HRIS person, and a Benefits person but no one with a Compensation title. (I looked up all the employer’s employees on LinkedIn that had HR related job titles.)

When an employer decides to be more open and transparent about their pay decisions, the first step is to communicate their pay or rewards philosophy. Here is an example:

“Company ABC is committed to aligning total compensation opportunity to the external market which is defined as what other competitors for talent are paying for substantially similar work. Our compensation philosophy is designed to attract, engage, and retain talented employees who support the organization’s mission and values and drive our success.

Most HR and Compensation professionals know that salary surveys and conversations about pay with peers in other organizations can violate the Sherman Antitrust Act.

Employers must avoid acting in a way that could be interpreted as trying to “fix” salaries at certain levels.

The U.S. Justice Department has published antitrust guidelines on how employers can exchange salary data and information without breaking the law. If you are a business leader, you need to know these rules.

Imagine a man and a woman both hired at the same time. The man is earning $85K and the woman is earning $70K.

The man earns a 3 (meets expectations) on a 5 point performance rating scale every year. This leads to a 3% merit increase every year.

The woman earns a 5 (outstanding) on a 5 point performance rating scale every year. This leads to a 3.75% merit increase every year.

In today's competitive job market, attracting and retaining top talent has become a key challenge for every organization.

Step 1: Offer competitive salaries and incentives. Offer benefits that meet or exceed the standard provided by other firms.

Step 2: Focus on relationships. Foster a culture of appreciation. Do your employees feel seen and heard? Are they valued and appreciated?

Negotiating a pay increase can be a nerve-wracking endeavor. And yet it is an essential skill to master if you want to be fairly compensated for your effort and results.

You can increase your chances of getting the pay increase you deserve by following these steps:

How many duplicate job titles (different job titles for the same job) do you have in your organization?

The standardization and elimination of duplicate job titles in the system is one of the steps in a Job Architecture project.

Of course, you have to have job descriptions to go with the standard job titles so managers and employees can help you determine if the work being performed by one employee vs. another is actually the same.

There are more than 25 U.S. states or municipalities that have salary history bans. Most of these laws were enacted after 2017.

There are hiring managers and some in HR that are still asking this question, “What are you making now as a Job Title at Company Name?”

We assign meaning to job titles.
We assign meaning to pay.
We assign meaning to vacations that people take.
We assign meaning to having a corner office.
We assign meaning to how someone dresses at work.
We assign meaning to someone’s Zoom background.

I remember the first time I got a pay increase as a twenty something year old after college. It was meaningful because it wasn’t a merit increase but an out of cycle increase.

My manager said something like, “I’m excited to share with you that you are getting a pay raise of X%, and this means your annual salary is going from $X to $Y. You’ve consistently been performing in your job and have exceeded my expectations. I wanted to ensure that we are paying you more competitively. ”

It took courage for the three women to sue Goldman Sachs for discrimination.

And then it took 13 years for this class action case to be settled.

Goldman Sachs will pay $215 million. $71 million of which will be going to legal fees.