Salary Transparency Is a Good Thing — And It’s Here to Stay
Salary transparency is becoming more normalized in the office and job market — for good reason. Many states and companies have made their own laws and standards to keep it.
Oct. 18 2022, Published 2:13 p.m. ET
To date, salary transparency is becoming more normalized in the office and job market — for good reason (the data speaks for itself). In fact, many states and companies have made their own laws and standards to keep it.
Arguments against pay transparency say employees are more likely to be dissatisfied with their employer and reduce productivity. However, that doesn't hold water in the modern economy and job market. Salary transparency plays an important role. Is salary transparency a good thing? Keep reading to find out.
Is pay transparency a good thing for job seekers and employers?
According to a new study by job search site Adzuna, 33 percent of job seekers won’t even attend an interview without knowing at least a salary range for the role they’re applying for.
This suggests that employers must step up in a competitive job market by being up front about salary, even if the range is flexible depending on experience. With high inflation and a surplus of opportunities, it’s in the candidate’s best interest to find out if the company’s budget is in line with their salary expectations before proceeding with an interview process.
Another survey by Glassdoor says that 63 percent of employees prefer to work at a company with pay transparency. Still, “only 19 percent of employees say their company discloses pay ranges internally among all employees,” Glassdoor writes.
Which states have salary transparency laws?
As of 2022, the following states have salary transparency laws:
California passed Senate Bill 1162 on Sept. 27. It goes into effect next year and requires employers to provide a salary range in all job postings.
Colorado enacted pay transparency at the beginning of 2021.
Connecticut’s Public Act 21-30 requires employers to provide pay transparency for empty positions to current and prospective employees.
Maryland has HB123, which requires employers to provide a salary range for a position upon applicant request.
Nevada has Senate Bill 293, which requires employers to provide a salary range automatically at the first job interview.
New York passed a statewide pay transparency law in September.
Rhode Island has a law that mandates pay transparency for existing employees.
Washington requires employers with 15+ workers to divulge the position’s pay upon applicant request, but only once a conditional offer of employment is made.
Many well-known companies have pay transparency,
A lot of local or regional businesses follow a salary transparency standard. However, there are some well-known companies with their own standards of pay transparency. Amazon-owned Whole Foods Market, Mercer, Buffer, and SumAll are a few known examples.
If companies provide a salary range, they get more (and maybe better) candidates.
The director of state policy at the National Women’s Law Center, Andrea Johnson, told reporters, “Transparency is one of the leading tools we’ve identified for closing the wage gap.”
Not only that, but it can help improve your pool of candidates to include people who don’t want to waste their time in a fruitless job search. It isn't a panacea for problems like pay inequity, turnover, and employee dissatisfaction. However, salary transparency can serve as an effective tool in a larger toolkit.