Editor’s Note: ‘Happy Hour’ is an HR Dive column from Reporter Ginger Christ. Follow along as she dives into some of the offbeat news in the HR space.
As more states and municipalities implement pay transparency laws, workers can glean more insight into how well — and how equitably — they are paid compared to colleagues or others in the industry.
In fact, most of more than 500 North American employers recently surveyed by WTW already have pay transparency policies, driven in part by global requirements. But, with transparency also comes risk, the survey notes, highlighting employers’ fears about receiving more compensation questions from workers and more requests for pay negotiations and off-cycle pay changes.
With more information, workers — especially those who are marginalized — are better able to advocate for themselves. When I started at a previous job, the company had to pay me more than I asked for because of its contract with the newspaper union.
Although there have been gains, women in the U.S. still earn roughly 15% less than men on average, according to an August report from The Josh Bersin Co., a human capital advisory firm. And without a look behind the curtain, it’s hard to tell if you are being paid fairly.
While 82.6% of the more than 1,000 U.S. workers recently surveyed by Self Financial believe that all employees’ salaries should be transparent, less than half think their company has fully transparent policies.
But here’s the kicker: 61% of respondents admitted to lying about their salaries to co-workers. Perhaps that’s understandable given that more than 3 in 5 employees said they either have resigned or threatened to after learning they were underpaid compared to a co-worker, according to Self Financial.
Former co-workers and I did our own informal pay transparency audit once, voluntarily revealing to one another how much we made. It was awkward, but we all valued one another and wanted to ensure everyone had the information they needed to be paid fairly — either at that company or elsewhere.
Despite laws regulating transparency, about 34% of companies still don’t have a pay equity strategy, and 45% of the salary decision-makers surveyed said their approach to pay equity impairs their ability to attract talent, according to a June report by beqom, a compensation platform.
As uncomfortable as these discussions can be, I think there’s always room for growth in discomfort. At the current rate, U.S. women aren’t expected to reach full pay equity until 2048 (when I, hopefully, will be close to retirement), according to The Josh Bersin Co. report.
Clearly, something has to change.