Salary transparency laws are spreading across the U.S., requiring companies to list salary ranges on job applications. While that’s good news for job seekers, it’s also raising the chances of upheaval as existing employees quickly find out what colleagues are being paid.
Roughly 1 in 20 workers will quit if they find out they’re making less than their coworkers, according to a November 2022 ResumeBuilder.com survey of 1,200 American workers.
“As more folks understand what their positions are being paid by their organizations, it’s going to have ramifications for people already working at the company,” said Stacie Haller, a career expert at ResumeBuilder.com. “Our survey also found that 63% of those folks will demand a raise for equal pay, and I think a lot of employers will take notice.”
As these laws prompt companies and leaders to reorganize how they talk about compensation, experts recommend increasing salary transparency provided to current and potential employees in order to retain and attract the best talent.
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Early this month, New York City joined Colorado in mandating salary ranges on job applications, with California soon to follow in early 2023.
Cheryl Fields Tyler is the owner and chief executive officer at Blue Beyond Consulting, a firm in California, which will start adding pay ranges to job postings on Jan. 1, after a state transparency bill passed in September.
Fields Tyler said she’s relieved pay transparency is required now for her company. Before the law, she said it was hard to navigate when and how to talk about what a particular position paid. If it’s required, then it’s easier for companies not to have fragmented policies on pay.
“Having a good, solid rationale for why we pay people what we pay them and the factors that change any individual situation is good for business, and honestly good for people,” Fields Tyler said.
She advises her clients, including some Fortune 500 companies, to make their philosophy and practice on pay and reward clear to employees, so they can have straightforward and fair conversations.
