3 Misconceptions About Salary Transparency

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Feb 27, 2020

Editor’s note: This article is part of a series highlighting speakers at the upcoming ERE Recruiting Conference. Click here to view other articles in the series.

Last week, I wrote an article about how the best employer brands repel talent. In that piece, I talked about total salary transparency, a topic I originally wrote about last year when I was first implementing it at my company. (“I’m Going to Try to Make Salaries Transparent” and “Salary Transparency in Action – It’s Personal”)

When I first wrote about this, I had just started conducting what I referred to as an “extreme experiment.” And for all intents and purposes, I guess it still is. After all, anything bold, new, or innovative a company tries with real people has a very real chance of exploding. I mean, failing. 

A year later, it turns out that what started as an experiment has really turned into a non-negotiable way of working for my company. The idea of fully disclosing salary information to all employees and to candidates has become a natural part of all our conversations at work. And yes, it’s creating some uncomfortable moments, but at the core, it’s actually preventing more disastrous kinds of explosions related to communication, transparency, and equity from happening later. 

Given that I read a lot of articles and blogs about the concept of transparency in organizations these days, I want to address a few key misconceptions about the subject.

1. Transparency won’t solve all your problems.

It will solve some, but if I’m being totally honest, it could create others — if you’re not paying attention.

Being totally transparent has created an opportunity for us to close critical skills gaps we weren’t aware of. With a transparent culture, you have to be fully prepared to support each of your employees and leaders with advanced communication and difficult conversation skills.

While transparency doesn’t mean unbridled bluntness or disrespect, it does open up an opportunity for individuals to “speak up,” use their voices, and be heard. It means honest, clear context and empowerment. With that, a need emerges to ensure everyone at all levels gets the tools to become excellent communicators.

At Kolmeta, we not only encourage continuous growth and learning; we ensure everyone has plenty of time in the week to focus on professional development. During our weekly team meetings, we encourage everyone to share the formal and informal learnings they’ve gained each week. As a certified leadership coach, some of my favorite concepts to pass on to my employees are around effective coaching and feedback skills, along with real-life stories of how I’ve put them to work.

By providing employees with these valuable skills, you can empower them to manage themselves and their relationships in a way that is conducive to moving the collective forward.

We all hold each other accountable to use the skills we’ve acquired.

2. Transparency doesn’t mean everyone gets to know everything all the time.

It means that relevant and important information is easily accessible to those who need it, without judgement. It also means that people can feel safe asking for information that can help them excel.

For example, at Kolmeta, our total salary transparency model doesn’t mean that everyone in the company physically processes payroll. (And quite frankly, I think most of our employees are OK with that. Shout out to all my payroll platforms and experts out there. You really are the unsung champions of HR!) But it does mean that each person in the organization knows what they make, what’s expected of them, what their peers make, and what’s expected of them. We’re all clear on what we need to do in order to ensure the success of the collective.

3. Transparency doesn’t have to be complicated.

It can start with something as simple as making salary ranges for each role more readily available. I observe lots of companies make attempts to show some form of transparency by way of sharing this kind of information with their employees. This is a great step in the right direction.

Plus, this in itself may create an opportunity for internal dialogue, and as such, makes my previous two points even more valid. Truth be told, salary ranges can vary from a low to a high extreme, leaving room for inequity issues. Now more than ever, employees care about being valued fairly. More specifically, valued fairly within the team. Sharing salary ranges and grids can be your first visible step and commitment to analyzing internal equity within your company. 

At Kolmeta, we’re putting all of our company values to work to create an environment where salaries are transparent, and employees can gain a sense of belonging through knowledge. They feel empowered to know why they get paid what they do and how they can take more control of their finances. 

Join me at the upcoming ERE Recruiting Conference, where I’ll be sharing tangible findings from my organization’s implementation of total salary transparency, including some shocking revelations about how this has impacted our employer brand, internal engagement, and, most interestingly, pay-equity matters. 

Interested in learning more about Kim’s extreme experiment in salary transparency? Come see Kim and network with tons of other great speakers and attendees at the ERE Recruiting Conference in San Diego, April 15 – 17. Use code ERESD10EXTRA to receive 10% off your ticket price. 

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