Candidates know when you offer them a base salary that is below market. And if your bonus or sales incentive is also low, that’s just another checkmark in the No column.

Your recruiters and hiring managers know when you are offering low pay. It just makes their job more difficult.

So, your ability to attract the talent you need is broken.

There are many choices employers must make related to pay transparency.  You can choose to deliver partial pay transparency or be fully transparent.

Partial pay transparency examples:

·        You share a job’s base pay range when it is posted. 

Employees want to know how much they will be paid for doing what. And they care that the amount they earn is aligned to their needs for things like housing, food, clothing, safety, security, etc. Maslow’s Hierarchy of Needs is the image below so use that as a reference for what people care about.

Employers want to know how much they will be paying for people who will do the work they need to have completed. They need to balance competitive pay with internally equitable pay decisions and their budget.

The compensation foundation that any employer needs is:

Pay compression happens when the pay of an employee is very close to the pay of more experienced and higher performing employees in the same job or those in higher-level jobs like manager jobs.

How do you solve it?

1) You look for it. You do a pay compression analysis at least once a year and look for these scenarios. (And don’t forget to consider overtime for direct reports to managers.)

We determine what is fair by considering not only our own situation, but also the situations of others whom we use as comparisons to ourselves.

We want pay-related decisions that are impartial and just. We want pay-related decisions that are without favoritism or discrimination.

Tell your employees the following:

Most of my employer clients spend less than an hour with me initially to share the scope of work they need to have completed.

I send them a proposal and after a few edits it is signed, and we schedule a kickoff call.  The compensation project moves forward, and the work gets done in the estimated timeframe and within budget.

Occasionally I talk to a potential employer client about the compensation work they need to have done and six months or more later, we are still talking.

If you want the potential you see in someone to become a reality you need to:

1.      Set expectations. Provide feedback regularly.

2.      Be the example you want them to follow. In other words, role model the behaviors you want from others. Consistently. No excuses.

I was in my 20s and my manager told me to stop rescuing people who were making mistakes.

She said that by saving them I was not allowing the consequences of their actions to teach them lessons they needed to learn.

I have never forgotten that lesson. 

Currently, about 1 in 4 workers is covered by some form of U.S. pay transparency legislation. At least 15 states are considering pay transparency laws in 2023. An effective pay transparency strategy requires a focus on 4 principles:

1.     Presence – The act of being present requires focus.  It is an intentional way of being that is focused on this moment.

Anyone can find out how much anyone else is paid.

A list of everyone's net income, net assets, and the tax they had paid could be found in a book on a shelf in the public library. 

Then in 2001 this information could be found by looking it up online. You could look it up anonymously.

You demonstrate your potential when you interview for a new job and so do the people with which you interview.

We all know that our best behavior during an interview isn’t what will occur each day on the job.

We also know the employer’s leaders describe their work environment in a way that is 100% positive and not like it actually is.

Yes, I said this about a senior leader once. Bill (not his real name) was being discussed at an HR meeting because a few of us had a difficult time influencing him. He didn’t listen, wasn’t self-aware, and was generally a pain in the patoot to work with.

I asked the question to get everyone to laugh because the conversation was heavy. 

He wasn’t thought of as a good leader by HR, by his boss, or by his peers.

I am always surprised when I talk to leaders, and they don’t have an answer to this question.

Even if you don’t have a compensation philosophy that was discussed at length, written down, and approved, you have one.

It just isn’t formal. 

When I started doing compensation work in the 1990s, I was excited to learn something new. My manager taught me how to make good decisions when using salary survey data to market price jobs.

I also spent time interviewing managers and employees to understand what was written in a job description. And then I revised the job descriptions to ensure they accurately portrayed the jobs.

It was the perfect blend of writing and numbers to match my interests and develop my skills.

"Between stimulus and response there is a space. In that space is our power to choose our response. In our response lies our growth and freedom." --Viktor Frankl

Before you speak THINK:

It’s not only what you know but who you know and how you get the work done that matters.

I have a coaching client who is great at their job. They can tell me what they delivered and why it matters to their employer.

We are writing their value stories so they can use those talking points in a discussion with their VP about getting a promotion and pay raise.

Do you trust the data you pull from your systems? Do you spend a lot of time cleaning up data to make it easy to use in your analyses?

My team and I spend a lot of time cleaning up employee and job data from various systems.

We spend time trying to figure out why the job title on the job description document isn’t the same as the job title of the employee in the HCM system.

It is especially great when I don’t have to create them. (Thank you Christine Hendrickson!) I attended a webinar today about the EU Pay Transparency Directive and how employers should be preparing to meet the requirements.  

Here is a link to Syndio’s EU Pay Transparency Cheat Sheet: https://synd.io/blog/eu-pay-transparency-cheat-sheet/

Key Webinar Takeaways:

Today I am calculating location specific base salary ranges in 5% increments for an employer client. They use ranges that go from National up to 25% and down to -35%.

What are the range spreads? 36% - 60%

Here is my question: What do you think about using one set of pay grades and base salary ranges based on National data? (This employer has all employees working in the U.S.)

It's great when you wake up on a Monday and look forward to the week ahead. The people and work you'll be focused on have you smiling.
 
You feel like you will be challenged and get to be creative. You get to use your strengths over and over to make a difference.
 
You'll have conversations with people who are interested in solving problems in a way that is healthy and focused on balancing the needs of all parties involved.