Knowing whether you are being paid fairly for the work you do is a mystery shrouded in lack of information. However, this may change, and pay transparency may be the catalyst. There is a growing trend for companies to disclose what an open job or current position pays – either voluntarily or because the government mandates it.
NAVIGATION OF SALARY RANGES
So far, about a dozen states and municipalities have mandated access to salary information, including California, Colorado, Washington and New York. Companies in jurisdictions are generally required to publish salary ranges with minimum and maximum wages. The rules vary: Sometimes only job seekers have to be informed, other times current employees can also request information about their salary range.
Roberta Matuson, president of Matuson Consulting in Boston, consults with companies seeking top talent. He believes pay transparency “is a step in the right direction.”
“Knowledge is power. So, you know, if you have no idea that you can make more money, then you wouldn’t even ask for it,” Matuson says.
IS THIS THE END OF YOUTH NEGOTIATIONS?
Pay transparency won’t eliminate salary negotiations, says Lexi Clarke, vice president of people at Payscale, a national provider of compensation data and services. Instead, Clarke says it will encourage discussions about current and future salary expectations.
It will help employees and candidates “understand what their expectations should be, where the (salary) thresholds are and where there can be flexibility. It levels the playing field between employers and candidates to make the conversation more open and transparent,” he says.
And Lulu Seikaly, Payscale’s senior corporate attorney, notes that as the law currently stands, employers are not barred from offering salaries higher than the range posted on the position, as long as the company can provide an objective justification for the exception.
In the past, companies were often based on what an individual earned in their previous job, Seikaly says. “Many states have now banned it.
If a potential employer asks about your salary history, Matuson says, “I wouldn’t refuse to answer; I’d say, ‘Well, tell me what you’re offering for this position.’ I would just turn the question around.”
WILL PAYMENT GAPS BE CLOSED?
Pay transparency reveals the pay gap but narrows the gender and ethnicity pay gap? Maybe it’s too early to tell.
But Payscale’s Clarke says organizations that are more open about pay often have well-defined reward structures and are less likely to have pay inequities.
He predicts how the gender pay gap could narrow: “Women’s pay will rise to where it should be – some of the overpaid men’s pay may be reduced slightly to bring it more in line with where it should be.”
WHAT IF YOU ARE AT THE LOWER END OF THE RANGE?
If you find yourself on the lower end of the salary range, Clarke says being transparent about your pay will help you communicate with your employer about what you think you’re worth. ” he adds.
Ask your employer how you can add more value and what skills you need to increase your salary and opportunities for promotion, Matuson says.
And it’s not just about money, he adds.
“There are other things you could ask for,” Matuson says. “For example, you could say, ‘It would help if I could work from home two days a week so I wouldn’t spend $50 or more a week on gas. Would that be appropriate?'”
AND IF YOU ARE ON THE BEST PAYING SITES?
What if you find yourself at the top of your work group? One result could be lower pay at the top of the pay scale, with the highest-paid workers facing increasing resistance to pay rises. Should you be worried that you are maxed out and could be among the first employees to be let go?
“Well, I think you should always think, ‘I could get cut,'” Matuson says. But he adds that even if you’re not actively looking for a job, call a few headhunters to determine salary scales for your current job and potential opportunities.
If you’re trying to determine the appropriate salary for your career, several websites offer tools to help you view the relevant salary range. You can find these tools at Payscale, Indeed, Glassdoor, and Salary.com.
This article was provided to The Associated Press by the personal finance website NerdWallet. Hal M. Bundrick is a writer at NerdWallet. Email: [email protected] Twitter: @halmbundrick.
NerdWallet: Smart Ways to Negotiate Your Salary in an Uncertain Economy https://bit.ly/nerdwallet-smart-ways-to-negotiate-your-salary-in-an-uncertain-economy