LinkedIn recently released their 2019 report, Global Talent Trends: The 4 trends transforming your workplace. In this four-part Recruitment Marketing series, we will explore the four industry trends you need to know to future-proof your workplace. Part 4, and the final part in this series, focuses on pay transparency.
Traditionally, employers decided where people worked, at what cost, and how much information they were willing to share. Many of us can appreciate that power dynamic has changed. Technology has empowered employees to access more information and hold employers to a higher standard.
Today, candidates expect transparency, flexibility and accountability. At the same time, organisations have greater requirements for their people too, not only in their technical capabilities, but also through important skills such as creativity, collaboration and adaptability.
“Both are embracing a more equal employer-employee relationship—not just because it looks good, but because it’s good for business.”
LinkedIn surveyed more than 5000 talent professionals and hiring managers to collate their 2019 Global Talent Trends report. After speaking with these experts and using behavioural data from the platform, LinkedIn has identified four trends impacting our workplaces: soft skills, work flexibility, anti-harassment, and pay transparency.
Pay transparency
“Transparency isn’t the goal. The goal is paying everyone fairly, and transparency forces us to do that. It instils trust.”
Traditionally, pay has been a confidential topic.
“Employers fear that disclosing too much information about employee salaries could cause wage disputes, limit their ability to negotiate, and encourage competitors to poach talent. But the benefits of pay transparency may outweigh these fears.”
Pay transparency sets salary expectations for candidates and overcomes misinformation that can negatively impact team culture, morale and retention.
“That’s because when left in the dark, most people tend to incorrectly assume they’re being underpaid.17 Most importantly, transparency can help ensure fair pay across gender, race, and all other demographics, creating a more trusting relationship with all employees.”
Early adopters are leading the way
It’s already becoming easier for candidates to learn about and share salaries on sites such as PayScale, Glassdoor, and LinkedIn. More organisations are framing the conversations by sharing the information themselves.
“Currently, 27% of talent professionals say their company is transparent about pay. Of those 27%, 67% of them share salary ranges with candidates early in the hiring process, 59% share ranges with employees, and 48% share ranges publicly on job posts. As the transparency trend gains further momentum, these numbers are expected to grow.”
Your organisation may be reluctant to share this information due because you fear disputes or upsetting team members. They are concerned that people will immediately demand high-end salaries or become unhappy after seeing what others make.
“Fear of upsetting employees is by far the most commonly cited reason for not sharing salary ranges.”
However, those who share salaries see benefits from building a culture of trust, respect and streamlined negotiations.
“According to talent professionals who practice it, pay transparency makes the hiring process more efficient by streamlining negotiations. It also helps ensure fair pay across gender and race, which is why many governments have recently introduced pay transparency laws.”
Pay transparency builds trust.
See how your pay stacks up
Start by conducting an internal audit to see how your pay compares to competitors and whether you have any major pay gaps across gender, race, and those in similar roles. If you do find significant inequities, create a plan to fix them via immediate raises or by changing your promotion policies.
Get your team members involved
Decide how transparent you want to be. There are many types and degrees of pay transparency—you could share salary ranges on job posts, share ranges with employees (for their own role or all roles), or even publish exact salaries. Determine what’s best for your company and get executive buy-in before bringing it to employees.
Solicit their input by sharing your proposed policies and what the expected results might be with them across multiple channels. Give them several ways to provide feedback and share concerns, from anonymous surveys to live Q&As and one-on-one discussions.
Develop clear compensation criteria
“Before rolling out pay transparency, make sure you can clearly answer what factors determine an employee’s pay, such as years of experience or past performance. Qualify what it takes to be at the minimum, midpoint, and maximum of the pay range.”
Train managers to discuss pay appropriately
“Talking about salaries can be uncomfortable. Training managers how to answer questions and explain compensation policies can make it easier for employees to have these conversations and feel good about them.”
Consider a slow, multi-phased approach
A multi-year approach can create a better transition for your people and organisation. For example, you could share your plans and training managers in the first year, provide employees salary ranges for their roles the following year, and share the ranges for all roles in the third year.
Use good communication
As you roll out the policy, ensure all your team members have the details they need. Reinforce the rationale behind transparency. If you can tie the initiative to your organisation’s core values, even better (for example, honesty, integrity, diversity, communication, or accountability).
Pay transparency is a trend on the rise. Websites are making it easier for candidates and employees to share information, so why not frame the conversation yourself and lead the initiative? It’s not without benefits to your organisation too. Pay transparency makes the hiring process more efficient by streamlining negotiations and helps to ensure fair pay across gender and race.
Source
LinkedIn’s 2019 Global Talent Trends: 4 trends transforming your workplace