Editor’s Note: This is part of a duo of simultaneously published articles about our collective discomfort addressing salary issues more openly. Check out this story’s companion article on TLNT: “How to Make Salary Transparency Work at Your Company.”
There’s a long list of topics that are “inappropriate” for the workplace: religion, sex, drugs, politics, money. We know these taboos, and we shush anyone about to bring them up. We want a “civil” work environment, so rather than train people on how to have a conversation about these topics, we pretend they don’t exist — until we no longer can.
Which is how we got to where we are with money. We pretend it doesn’t exist so much that we have rules around when it’s OK to talk about it during the selection process. But just like sex and dating, there’s no hard and fast rule about this. Some people are fine with a candidate asking about money during the first contact, while others feel that’s rude because they just want someone who “really cares about the job” and isn’t working just for the money.
Well, I don’t know about you, but I don’t know anyone who is able to work just because the person feels a connection to the business and doesn’t care about the salary. Pretty sure most of the folks working at McDonald’s aren’t all that passionate about the McChicken.
The majority of us are working for a paycheck, so as talent acquisition professionals, we need to get more comfortable talking about uncomfortable topics like money with candidates. We need to talk about it early and often. We need to be okay with candidates bringing it up, but better yet, we need to initiate the conversation. That way, we can lead it, and if we are wise, we will help candidates along the way.
My History of Pay Discussions
I’ve been in TA for about 20 years, and I can count on one hand the number of times I’ve attended training or even a meeting on compensation in the workplace. I’ve been given formulas or guidelines, but no real conversation around our philosophy on how those came to be.
My lack of compensation understanding started with my very first teenage job. There was no salary negotiation, much less discussion. When I was offered the job, I wasn’t given any pay information. I didn’t even know when payday was! When I showed up to work the first day after payday, my boss asked if I was independently wealthy. Ummm, cue teenage girl giggle.
Here’s the thing, folks: No one told me that I needed to ask about pay! Maybe it’s something I “should have known,” but if no one is talking about money, how? I kind of just assumed that my boss would let me know when payday was and hand me money. Ah, the ’80s and paper checks!
This has led me to a lot of bad habits when it comes to money and employment. Even in recent job changes, I forget to ask about money until I’m a few steps into the process (don’t want to look too greedy). And my negotiation skills…well…I’ve never really been able to follow my own advice.
I know what I want to make, but get a bit wishy-washy when it comes to talking about numbers. “Oh that’s a nice offer, but I was really kinda, you know, hoping it would be somewhat closer to [another number only $2K to $3K higher]. Do you think you could go any higher, maybe?” And this is as someone who is doing job offers on a regular basis! Imagine how difficult it is for people who only look for a new job a handful of times in their life?
As the employer, we can make this conversation a lot easier for candidates and ourselves by being transparent about the information.
The Struggle to Have Pay Conversations
We can doesn’t mean we will. This isn’t something many employers want to do. According to a LinkedIn survey, 51% of companies are not currently sharing salary information in their job postings. However, 22% state that they are likely to start doing so within the next five years. (It’s worth pointing out, though, that these findings are before unemployment skyrocketed.)
From the candidate’s perspective, this would be a welcome change. A Glassdoor survey from 2017 showed that nearly all (98%) job seekers and employees say it would be helpful to see pay ranges included in open job listings. Other Glassdoor research also shows 70% of employees believe that salary transparency is good for employee satisfaction. However, there is still a belief among employers that employees cannot handle knowing what their colleagues make.
The problem is not that employees can’t handle the truth; it’s that we don’t share the story with them. Employees typically have no idea how pay ranges are set, how salary offers are determined (admit it, recruitment staff, you probably don’t know much about this either!), so they have to make up a story to fill in the blanks. Employers, you need to be out in front of this. You need to tell your own narrative. Give your employees some credit. They can handle it.
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Creating a Level Playing Field
So let’s talk about that first step in transparency — sharing the salary range or minimum in your job posting. Knowing this information at the beginning of the process allows candidates to determine if this is a wage or range they can work with. That knowledge puts salary negotiation on a level playing field. It also allows the selection process to focus on the candidate’s skills and abilities without wondering whether the candidate will accept a position within the range.
According to a 2015 Payscale article, job postings that include a salary range get 30% more applicants. There is not much research available as to the quality of the candidates; one can assume that these applicants are, at a minimum, within the salary expectations of the role. As a recruiter, you know this will save you time and help avoid that feeling of getting to the end of the selection process only to discover that your ideal candidate expects way more money? We’ve all been there, and it’s not fun.
Effect on Employee Engagement
Salary transparency will also help with overall employee engagement. Most employees struggle to understand the market value of their work and compensation. More than two-thirds of respondents to a 2017 PayScale survey of 930,000 people felt that their compensation was below market value. In actuality, 77% were paid at the market rate and 12% above it.
By creating open and transparent conversations around compensation packages, employers can help people understand where their salary fits within the market and be more satisfied not just with their pay but with their overall employment relationship.
Meanwhile, a Payscale report found that how much employees are paid relative to the market for their position matters relatively little in terms of employee satisfaction. What does matter is how they feel about how they’re paid, which has 5.4 times as much impact. By taking charge of the narrative around the compensation policy, you can brand it and influence employee perceptions of their total rewards package.
How to Own the Process
Part of owning the narrative around compensation is ensuring that TA professionals and hiring managers are able to properly share the information in a way that creates a level of trust and understanding with candidates. So:
- Arm your TA people with information on your salary policy and talking points for your compensation philosophy.
- Create a concise document to give to candidates so they can evaluate your entire compensation package, including benefits (and please, start sharing more of this information from the beginning).
- Reference compensation throughout the selection process. It can be as simple as a reminder of the salary range or even an estimate of where an offer might fall. Then confirm that the candidate is still on board with that number.
Will this be awkward? At first, most likely. But you will get used to it and word will get out that you actually share salary information, which will likely help with employer branding, streamlining your process, and creating a more positive candidate experience.
As TA professionals, we are in the position to change the taboos around salary and work. No one who applies for a job with your company wants to work for free. We need to stop pretending that candidates have totally altruistic reasons for wanting to work for you. Stop taking points away from candidates who ask about salary. Better yet, be the person to bring it up. Put it in your job posting. Help candidates through the salary process. Communicate with them. Own your process.