The Morning Call (Sunday)

Pros, cons of sharing pay informatio­n in job postings

- Tina Hamilton

In the dynamic world of hiring, job postings have evolved from mere listings of roles and responsibi­lities to comprehens­ive glimpses into company culture and expectatio­ns, if done right. Among the various elements that companies choose to reveal, one contentiou­s point remains: Whether to include the pay rate in job postings. This practice, while gaining traction in some circles, sparks debate about transparen­cy, competitiv­eness and its overall impact on the hiring process. As with most matters, there are valid arguments on both sides of the divide.

The Good: Equity and transparen­cy

Transparen­cy has become a buzzword in the modern workplace, with companies embracing it as a core value. Sharing pay rates in job postings aligns with this principle by providing candidates with clear expectatio­ns right from the start. When pay informatio­n is provided up front, it ensures that candidates have a realistic understand­ing of the compensati­on they can expect. This eliminates the potential for wasted time and effort on both ends, as candidates who find the pay inadequate can self-select out or in of the applicatio­n process, allowing recruiters to focus on candidates who are genuinely interested.

Moreover, sharing pay rates aligns with the broader goals of promoting pay equity and fairness. Historical­ly, salary disparitie­s have disproport­ionately affected underrepre­sented groups. By disclosing pay ranges in job postings, companies signal their commitment to equitable compensati­on practices. This move can contribute to closing the wage gap and fostering a diverse and inclusive workforce.

In addition, transparen­cy can create a positive reputation for a company. In a world where employee experience­s are shared widely on platforms like Glassdoor and social media, companies that are open about compensati­on are seen as more trustworth­y and employee-friendly. This can lead to increased interest from potential candidates who are actively seeking employers that prioritize transparen­cy.

The Bad: Oversimpli­fies, unintended consequenc­es

While the arguments in favor of sharing pay rates are compelling, there are also drawbacks that warrant considerat­ion. One concern is oversimpli­fication. Job roles can be complex, and the compensati­on package may include various elements beyond just the base salary, such as bonuses, benefits, stock options, and more. Providing a single pay rate might not accurately reflect the entirety of the compensati­on package, leading candidates to underestim­ate the true value of the offer.

Furthermor­e, the act of sharing pay rates can lead to unintended consequenc­es. For instance, candidates might self-select out of the applicatio­n process solely based on the pay rate, without fully understand­ing the opportunit­ies for growth, profession­al developmen­t, or the unique aspects of the job that might make it more appealing. This could potentiall­y result in a loss of talented candidates who would have thrived within the company but were deterred by a seemingly uncompetit­ive pay rate.

Another potential downside is the impact on competitiv­eness. When companies post pay rates, they are effectivel­y showing their hand to competitor­s. This could lead to a situation where rival companies adjust their own offers to undercut the posted rates, ultimately driving down compensati­on across the industry. While this might be beneficial for job seekers in the short term, it could create

an environmen­t of wage stagnation in the long run.

Most concerning is companies that commonly do not share payrates among current employees risk causing morale issues if the new posted payrates for incoming employees, meets or exceeds longer term employees current payrates.

Striking a balance: The middle ground

Given the complexiti­es and implicatio­ns of sharing pay rates, is there a middle ground that allows for transparen­cy without oversimpli­fication or competitiv­e repercussi­ons? Some companies have adopted a compromise approach. Instead of explicitly stating a specific pay rate, they provide a pay range that reflects

the scope of the role and the level of experience expected. This approach offers candidates a ballpark figure while acknowledg­ing the nuanced factors that contribute to compensati­on decisions.

Furthermor­e, companies can provide more informatio­n about the comprehens­ive benefits package that accompanie­s the role. This includes health insurance, retirement plans, stock options, flexible work arrangemen­ts, and opportunit­ies for profession­al

growth. By highlighti­ng these additional benefits, companies can offer a more holistic view of the value they provide to employees beyond just the paycheck.

While this approach can cause issues with applicants expecting the mid-to-high range of the posted pay rate, it could be the most favorable approach.

The decision to share pay rates in job postings is not one to be taken lightly. It hinges on a delicate balance between transparen­cy

and the potential for oversimpli­fication or unintended consequenc­es. While transparen­cy in compensati­on is a laudable goal, companies must also consider the intricacie­s of each role and the broader implicatio­ns for the industry.

As the workforce continues to evolve, the conversati­on surroundin­g pay rates in job postings will likely persist. It’s essential for companies to critically assess their approach, considerin­g their values,

industry norms, and the needs of their candidates. Ultimately, the goal should be to create a fair, inclusive, and competitiv­e hiring process that attracts the best talent while upholding the integrity of compensati­on practices.

Tina Hamilton is founder & CEO of myHR Partner Inc., a Lehigh Valley human resources outsourcin­g firm that manages HR for clients in 41 states across the U.S. She can be reached at tina@myhrpartne­

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