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Compensation has been a hot topic in business over the last year. In this episode, we share some overall advice on compensation, then discuss pay transparency.

Develop a compensation philosophy; know how you want your pay and benefits to compare to others in the market. Use data to make sure that you pay your employees a fair wage. Be prepared to explain and market your compensation philosophy, both internally and externally. And review or audit (or have someone else audit) your internal equity to identify disparities in pay ranges based on an individual’s gender, race, tenure, or other factors.

As of May 2024, eight states require employers to publicly post salary ranges for open positions, and many others are in the process of considering pay range transparency bills. We believe it won’t be long before all states implement these laws. While there are a few complications with them, overall they’ll be good for employers and employees.

Sometimes the laws aren’t very clear; for example, companies have posted ranges of $90,000 – $900,000, clearly not a good faith range. And while the intent of the law is for employers to post base salary, some organizations post ranges that take into account bonuses, incentives, and more. Many wonder if the laws will be enforced and whether all companies will comply, and many factors have impacted pay in the last few years, making it difficult for employers to keep up.

However, when compensation is shared early in the process, we avoid mismatched expectations. Companies are more likely to attract the right candidates for their job openings, and employees are more likely to feel they’re being fairly paid. Organizations also report receiving more applications and higher-quality applicants when they list pay ranges on job postings. Researchers point out that in the public sector and organizations with unions, both of which have requirements that lead to more pay transparency, the gender wage gap is narrower than in other organizations. Turnover increases if employees think their pay is unfair, so being more transparent can lead to higher retention, too.

It’s important to communicate well about how pay decisions are made and clear steps employees can take to increase their salary. Train managers on these conversations, and make sure they’re being consistent and reinforcing these conversations along the way.

In this episode’s listener question, we’re asked about book suggestions regarding online meetings. In the news, employees returning to the office find that the spaces are too focused on individual work.

Mentioned in this episode:

• Purple Ink
• Susan Tinder White Consulting
• US Bureau of Labor Statistics Compensation Data
• Glassdoor Salary Data
• Salary.com Salary Data
• ”Bring Your Compensation Strategy Up to Date”
• ”The Real Effects of Pay Transparency in Business”
• ”Can Pay Transparency Reduce Employee Turnover?”
• Death by Meeting by Patrick Lencioni
• Six Thinking Hats by Edward de Bono
• Click: The Virtual Meetings Book by Michael Wilkinson and Richard Smith
• ”Cisco Hybrid Work Study Reveals Companies’ Need to Modernize Offices”
• JoyPowered® on LinkedIn
• JoyPowered® on Instagram
• Email JoyPowered®

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