What would happen in your organization if you had salary transparency? If everyone knew each other’s pay, would chaos ensue? David Burkus makes the case for why you should know how much your coworkers get paid in short TEDx video. Burkus is a business author, podcaster and associate professor of management at Oral Roberts University. “He challenges traditional principles of business management and argues that many of them are outdated, outmoded or simply don’t work — and reveals what does.”

The salary transparency or open pay trend has been gathering steam, particularly in tech and startups. Here’s a roundup of thoughts on the topic.

Meet The Companies That Make Their Salaries Public – And Say They Are Happier For It

Louise Ridle interviews several companies that have adopted pay transparency, including Joel Gascoigne, CEO of Buffer:

“Someone felt that if their friends and family knew their salary, it might change the relationship they have with them,” Gascoigne explains. But that initial discomfort proved unfounded, he says: “In the end, an overwhelming result we found was that a lot of these kinds of fears showed themselves much less than expected in reality.”

Before the spreadsheet was released, Buffer’s team had frank conversations about how much different people’s salaries should be and why, which “helped us avoid any kind of surprise,” he admits.

The decision has made it a more enjoyable place to work, Gascoigne says, pointing out that when salaries are out in the open, “a lot of the politics can go away”.

Open Salaries: the Good, the Bad and the Awkward
Sue Shellenbarger, Wall Street Journal

Pay secrecy is linked to lower employee performance and a higher likelihood of quitting when employees suspect performance assessments or criteria for setting pay are unfair, says a 2015 study co-authored by Peter Bamberger, associate dean for research and faculty at Tel Aviv University in Israel. Many people would rather look for a new job than ask for a raise, the Robert Half survey says; while 89% of participants said they deserve a raise, only 54% said they plan to ask for one.

How Much Salary Transparency Is Right for Your Business?

Sharon Florentine, CIO, talks about what is driving this trend:

The transparency trend is being driven by a number of factors, according to the Society for Human Resource Management: increasing availability of such information from sites such as Glassdoor.com, Salary.com and companies like compensation benchmarking software provider PayScale.com; an increasingly tight labor market and awareness of pay equity; and the influence of the millennial generation, who’re already accustomed to openness and transparency through social media.

Her article suggests there may be a middle ground and offers five factors companies should consider before deciding whether to make salaries transparent.



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