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What Do Employees Think About Employers’ Transparency?

Posted on June 24th, 2016 Read time: 2 minutes

According to poll results released in May 2016, more than 7 in 10 U.S. adults don’t think private companies should disclose employee wages internally. However, Americans do want salary or wage ranges included in new job postings. Learn how these factors affect your small business. 

  • Poll Results

More than 530 people responded to the Marist Poll conducted by PBS affiliate WGBH Boston in April. 58 percent believe making salaries public would cause employee conflicts rather than increase fairness of pay within the organization. 63 percent of white respondents and 51 percent of racial minorities say publicly releasing salaries would result in friction among coworkers. 79 percent of men and 67 percent of women think employees’ wages should not be published within companies.  

  • Interpretations

Valerie Samuels, a partner with law firm Posternak, Blankstein and Lund in Boston, pointed out that although most employees want to know what their coworkers earn, those employees don’t want their coworkers to know how much they earn. Because Samuels’ law practice focuses on pay discrimination, she pointed out there are many degrees of pay transparency ranging from deep transparency, where each employee’s salary is posted online, to more generalized approaches, such as disclosing pay ranges and median pay for positions.

  • Pay Disparities

According to the poll, white men were much more reluctant to have their pay disclosed than women and nonwhite Americans. Based on her experience as a litigator, Samuels pointed out that women and people of color are often more in favor of pay disclosure since they’re more likely to experience pay discrimination. Greater pay transparency benefits women and nonwhite Americans when applying for jobs because they have a median or range for negotiating pay. According to Samuels, men often ask for 30 percent more money than women. Therefore, arming women with pay information will help decrease the disparity.  

  • National Labor Relations Act

The National Labor Relations Act (NLRA) does not allow retaliation against union or non-union employees who discuss their wages. According to Samuels, however, employers often try stopping workers from discussing their pay. For example, when revising handbooks stating employees cannot disclose salary or wage information, Samuels crosses out the statements and explains to the employer why that is unlawful. In January, the Office of Federal Contract Compliance Programs issued regulations prohibiting government contractors and subcontractors from retaliating against employees who ask about or disclose employee compensation.

  • CEO Pay Ratio

In 2017, public companies will be required to disclose how median employee pay compares with CEO compensation. Samuels believes that will cause many issues, since employees know their boss makes a lot of money, but may not realize how much it really is. Because the disparity between C-suite executives and employees continues growing, workers fighting for a $15 minimum wage should have strong feelings about the issue.

Whatever your viewpoint on transparency, we are here to help with all your non-core business needs. For all your back-office needs, reach out to the friendly staff at Innovative Employee Solutions today!

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