By Caitlyn Rest
Recently the idea of pay transparency has taken the job market by storm, with research from the Society for Human Resources Management [SHRM] showing that applicants are 82% more likely to apply for a job where the salary is listed in the posting. Pay transparency can be great for applicants looking for new jobs and it has even been proven that with salaries posted on job listings, more qualified candidates apply. But what is pay transparency, and how will it affect you?
What is pay transparency?
Pay transparency is the practice of letting interested applicants know what the salary or salary range is for a job before they apply. In some states, this has become a legal requirement. The point of pay transparency is to try to close the gender and minority pay gaps in the job market, the idea being that when the job listing is posted the employer must show the salary range to make it harder to discriminate in pay.
Another part of pay transparency that can help close the wage gap is the fact that when people find out they are being paid less for their work than others with the same or similar jobs, they will likely try to renegotiate their salary to keep up with everyone else.
What states require pay transparency?
Lately, many states have passed pay transparency laws or requirements that require salaries to be disclosed up front. These states require pay transparency, along with others that are planning to institute pay transparency laws.
- California
- Colorado
- Connecticut
- Hawaii
- Illinois
- Nevada
- New York
- Rhode Island
- Washington
In these states, employers have no choice but to post their salary on job posting, which can cause worry for smaller employers who are unable to pay as much as their counterparts.
How to attract candidates without being the highest paying organization.
For smaller organizations, pay transparency can be thought of as a hinderance since they are often unable to pay as highly as larger companies or agencies. The best way for smaller organizations to be able to stand their ground in the job market is to highlight other benefits and incentives such as:
- Flexible scheduling
- Hybrid work options
- Closer relationships with managers and colleagues
- Mission-orientation and serving the community
- Training and development opportunities
When creating job postings smaller organizations should focus on advertising these things if they worry about being competitive on their pay.
Whether pay transparency is a new law in your state or something your organization is considering starting to do, there are always ways to make you stand out in ways other than just base pay. While many different types of employers may have different opinions on pay transparency, the idea of using this to close the gender pay gap is a step in the right direction. Viewing this policy as a helpful workplace tool rather than a hindrance could help to create a fairer and more equitable workplace.
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Caitlyn Rest is an intern with Organizational Architecture working as a Project Support Specialist. Caitlyn is a student at Columbus State Community College in Columbus, Ohio and is working towards her Associate's degree in Human Resources Management.