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A relatively new wage transparency law requires employers to disclose salary ranges for open job postings.
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Jenn Lim, global workplace expert, speaker, corporate consultant and CEO of Delivering Happiness, said: This is not the final solution, but a step in the right direction. “
With that in mind, let’s explore different aspects of the law and what they mean for job seekers.
Leveling payment fields
Legally protected groups—segregated by race, age, gender, etc.—have more salaries than their white male counterparts under 40, according to Linda Vandeventer, Segal’s vice president of compensation and career strategy. The need for such a law arose when it turned out to be low. .
“Each wage transparency law is written with different rules. These laws define salary ranges for job postings, salary ranges for employees eligible for promotion, job description offerings, and bonus/incentive programs. We may ask you to provide an explanation of the
“This is a win for employees, and they are now given more rights. Knowledge is power. More knowledge means more facts we can use when navigating the job seeker process and negotiating the best offers,” she added. I was.
These laws may be less important for jobs with a single point of employment, such as teachers, firefighters, nurses and union workers, who are usually paid under a “step” program methodology, Vendé said. Venter explains.
What state are you in?
Only a handful of states currently have pay transparency laws, and Colorado was the first state to do so. California, Connecticut, Maryland, Nevada, Rhode Island, Washington and New York have recently joined Colorado.
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Demand for clarity
Pay transparency is part of the call for clarity and fairness, part of the call for a more inclusive work culture that supports everyone, not just some.
Mr Lim said: This helps put money in the pockets of women and communities of color. am. ”
Impact of unequal pay
One of the downsides of these laws, even if well-intentioned, is that some employers may face legal repercussions for unequal pay, resulting in disgruntled employees. may retire, Lim explained. “When tensions and insecurities arise within the workplace and workers find themselves paid less than their counterparts, morale and productivity can suffer.”
subjective practice
Another possible shortcoming of the Transparency Pay Act, VanDeventer said, is that there is no salary range that “one size fits all” because some other jobs are unique in nature. “There can be a lot of subjectivity going into establishing wage levels.”
For example, “An accountant is typically an accountant for the entire organization, but jobs such as marketing, supply chain, sales, and operations are designed to optimize the role for each organization’s unique business needs and organizational structure.” salaries can fluctuate as well.”
discourage applicants
The Salary Transparency Act is intended to help workers understand if they are underpaid and to provide job seekers with a general goal, but the creation of The Salary Negotiator author Brandon Bramley says there is a lot of room for improvement.
“We’ve seen how these perform for job seekers. Or does it include other total compensation components (i.e. annual bonuses, equity, or sign-on bonuses)? It discourages negotiating because of the amount, but in reality it’s not and I’ve seen companies negotiate beyond the listed amount,” he said.
According to him, recruiters rely on these ranges to encourage job seekers to commit to numbers before an interview, learn more about the role, and review benefits/culture. “This could lead to them accepting rates lower than the market and missing out on opportunities to be paid at the true high end of their payment range.”
Don’t Overreact: Negotiate
VanDeventer warns against overreacting to posted salaries. Especially if the salary range is lower than expected. “It is often possible to earn more than what is shown in the job posting. Organizations often post an expected “employment range,” which is a subset of the full salary range. There is a possibility that For good individuals, there is generally room for negotiation. “
Additionally, organizations often have multiple levels of jobs and are willing to step up jobs for those who are “right”. And when it’s an organization that you’re very interested in working for, you have to be persistent.”
Employers need a strategy
For employers, “this is to improve the effectiveness of their salary communications and how they fit into the employee value proposition (compensation, benefits, career development, benefits) offered. It’s an opportunity to be strategic and intentional,” said VanDeventer.
“Many organizations do a poor job of communicating how their payroll programs work, which can lead to employee disengagement and turnover,” she added. rice field.
Increase in corporate administrative work
Unfortunately, these laws create more administrative work for employers. According to VanDeventer, “Some employers fear that everyone will demand the top of the posted range, so they wrestle with the question of ‘what part of the salary range’ to post. They are concerned that they may turn off some candidates if they post ranges that are too low, fearing that everyone will ask for the high end of the ranges posted. I’m trying to strike a balance with
Win-win possibilities
In the long run, salary transparency may be good for everyone, says Chelsea Jay, career and leadership development coach at Seasoned and Growing. Pay transparency, she said, gives employees “increased confidence”, equips them with knowledge about roles and salaries, and allows them to choose which jobs to apply for where they spend their time.
Salary transparency also prevents frustration for employers and candidates. This is because both sides have a mutual understanding of what is available in terms of salary, at least in relative terms.
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