Knowledge is Power… for Employers and Candidates
How much does this job pay?
As a recruitment professional, I speak with many hiring leaders about what they are doing to attract the best talent to their organizations. I also want candidates to understand all of the benefits of working for my client, from leadership development programs to company culture to the important role they will play in the organization.
I use a compelling narrative to describe everything that this company has to offer and to explain why I think they are the best match for the role.
Every client is unique, every opportunity is unique, and every candidate is unique. But there’s one question that is always asked: How much does this job pay?
I’ve never understood the reluctance of some companies to share the full range of compensation they’re prepared to offer qualified candidates, especially now that it is becoming a compliance issue. Seven states—California, Colorado, Connecticut, Maryland, Nevada, Rhode Island, and Washington—have led the way in passing pay transparency legislation. In New York State, this legislation is scheduled to take effect in September; pay transparency laws are already in effect in New York City for employers with more than four employees.
The legislation differs from state to state. In California, employers with more than 15 employees are required to list salary ranges on job postings; they must also share pay ranges for an employee’s current position upon request.
There are also differences in how the legislation addresses external and internal job postings, as well as remote work. The New York City legislation impacts companies in any location if there’s a possibility that some or all of the work may be performed by someone living in New York City.
Frankly, I think these laws are overdue. The data demonstrate that there is still a significant racial and gender-based wage gap: for every $1 earned by a White worker, a person of color earns $0.77, while women earn $0.76 for every $1 a man earns. And pay transparency legislation can impact these disparities. The gender pay gap has been reduced by 45% in companies that disclose compensation compared to those that don’t.
Making sure that all workers are paid fairly is good business for every employer. But there are additional reasons why I describe pay transparency as a competitive advantage for my clients.
Compensation is a critical tool to attract and retain top talent. It should answer questions—not create more uncertainty. In today’s competitive recruiting landscape, I encourage my clients to ensure that they are offering compensation that fully reflects the skills and talent they want to hire. My goal is to make sure that they are proud of their business model, proud of the culture they have created—and proud of how they are rewarding their key contributors.
The amount you pay your employees—and the amount you are willing to pay prospective employees—shows how much you value them. Employees want to feel valued by their organization. Demonstrating that value is a smart strategy when your goal is to recruit highly desired candidates.
Being open and honest about compensation is also a proven way to build trust with your employees. That’s why I respectfully disagree with companies that respond to pay transparency requirements with overinflated minimum and maximum potential salaries that may differ by $100,000 or more, or simply refuse to post opportunities at all.
Organizations expect candidates to be open and honest about the skills and expertise they can bring to their role. I encourage my clients to be every bit transparent about the compensation they will offer for those skills and expertise.
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