ABC News has an interesting article/video about salary secrecy. I’d love to get a discussion going on this topic. They explore why companies keep salaries secret, and whether or not it would be a good idea to allow for salary transparency in the workplace.
ABC has a claim that salary secrecy allows for women to be underpaid. I know a lot of that has gone on. I have no idea if it still goes on at all. I don’t know if it’s some kind of conscious decision. Imagine a scene similar to a bad 70’s Christian movie. A bunch of evil looking men are sitting around a boardroom with cigars and brandy, and somebody says in an evil voice “Hey, why don’t we decide right now that any women we hire will automatically be paid 40% less than their male counterparts for the exact same experience and work!” to which the others reply in an evil laugh “Muuuw-hah-hah-hah-hah-hah!!!!!!!!!!!!!!” I’m sure it still happens though. I’m just saying that the thought process that leads to it eludes me.
Are there good reasons to keep salaries secret? I’m sure there are. I learned that hard way to keep my mouth shut. When I was in the Navy, everybody knew what everybody else made. Even if you ran across that one moron who believed by not telling you what he made, he could somehow control the information, it was easy enough to find. Just find out what paygrade he is, how long he’s been in, and what state he resides in. If that state has taxes, find out what they are. Also find out how long his sea tour has been and what allowances he may be getting, and you can calculate his pay with some accuracy. On top of that, at least when I was in, everybody got a “Leave and Earnings Statement.” Normally one representative picked them up for the entire division, and at least he got to see them. I can remember when I saw my supervisor’s LES. Even though he’d been in the Navy longer than me and was married, he had child support deducted, so I actually took home $10 a paycheck more than he did.
When I started working for Lockheed Martin, another former sailor started with me. Since we’d been in the Navy, neither of us thought anything of asking each other what we made. We both were brought in for the same job. Turns out our salaries were within $10 a paycheck of each other, but he got a signing bonus that I didn’t. However, that conversation was overheard by another coworker. She’s been hired for a lower job, but left to work for MCI/Worldcom. Fortunately for her, MCI/Worldcom screwed her over and she left to come back before their collapse. The job she’d been hired for was no longer available, but they put her into the job I was doing at the salary of the lower-level job. When she heard what we were making, I would be under-expressing myself if I said she was PISSED. That kind of made our jobs rough for a while. It wasn’t our fault, but she did tend to resent that we were paid more for the same job. I learned that day never to discuss my salary again.
When I left that job to take my last one, I heard one coworker discussion what my predecessor had made. He said that pay that guy was getting for that job was ridiculous. I was actually making more than that, and kept my mouth shut.
I do agree with the ABC News article that the company benefits more than the employees. I can’t tell you how mad people get to spend years with a company getting the cost of living raises every year, then find out the the new people starting are getting paid more than you are. That’s hardly fair. Of course, when you’re the new person, you probably don’t want to find out that the long-term employees are being paid less.
The ABC News piece talked about salary transparency. Should salaries be transparent? I know in corporate life, it would be far more appropriate to discuss your sex life than your salary. I’m not sure if that’s right.
I was going to say I’m afraid that openly published salaries and paygrades could lead to some kind of employment caste system, but it’s already in place and is one reason why I didn’t stay in my last job. I was an Engineering Technologist II. When I got my IT degree, I asked if I could be moved up a grade. I was told no. The company had some complex algorithm to calculate what caused you to move up, and getting that degree isn’t on that list. I did the next best thing: I left.
One point brought up in the article is that salary transparency would allow you to negotiate better. You could go to your boss and say “Look, dude, you pay me $55,000 a year. Butthead over there gets $60,000, and does less work. You should pay me more because I can prove to you by my results that I deserve it.” I can see by that scenario that the company and Butthead benefit from the salary secrecy.
What do you think? Are you better off not knowing what anybody else makes and them not knowing what you make? Or would you rather have everything out on the table?