Why You Should Be Able to Discuss Your Pay Openly

By Desiree Yang The discussion of salaries among employees has always been viewed as a huge workplace taboo. It is a highly sensitive topic, with the potential to lead to ill will and feelings of resentment. However, the silence surrounding employee pay is to the detriment of employees – for instance, it enables inequitable pay between different genders or ethnicities to persist. President Obama announced on April 8 (Pay Equity Day) of this year that he intends to direct federal contractors in the US away from company policies that discourage or outright ban employees from discussing their salaries. The move – part of an effort to eliminate the pay gap between male and female employees who hold the same jobs or do the same work – will ultimately impact the lives of millions who are hired through taxpayer dollars in the US. This could be the beginning of a more open approach to employee pay, and there is little reason not to embrace it. The Open Discussion of Salaries Being able to engage in open discussion about salaries will enable greater clarity on issues such as equal pay for men, women and ethnic minorities. The pay gap that exists between male and female employees has always been a hot topic for discussion, even in Southeast Asia – where men continue to earn more than women. However, if employees aren’t allowed to discuss their pay openly, they will never know if they are being underpaid. A case in point is Lilly Ledbetter, the woman who prompted President Obama sign into law the Lilly Ledbetter Fair Pay Act of 2009. Ms Ledbetter worked as a supervisor in a Goodyear tyre factory for 19 years and was paid less than her male co-workers for many years, but only found out when someone took the risk of slipping her an anonymous note. The open discussion of salaries will also help offices to function better and more efficiently. If employees are able to discuss their salaries openly, it will reduce the amount of speculation and gossip that swirls around the subject and minimise negative influences on employee motivation and performance. Another approach is the one that Whole Foods co-CEO John Mackey adopted, where he disclosed what every single employee earned back in 1986, wanting to help employees understand why some were being paid more than others – in the hopes that lower-paid workers would strive to be more productive to boost their salaries. This level of transparency shows employees that the company trusts them, and also helps employees feel valued and important in the workplace. Employees will also have an easier time negotiating raises or promotions with the company. When employees know how much their co-workers make, they will be equipped with the information to make more reasonable and informed requests. Treading Uncharted Waters Such a radical move certainly places companies in a rather sticky situation, and can lead to dire consequences if managed poorly. For one, if companies choose to follow in the footsteps of Whole Foods, but fail to provide a good explanation when questioned by employees, the company will end up shooting itself in the foot. Not to mention, there is a common perception that people only share their salaries when they wish to boast. It will definitely take some time for employees to embrace this new culture of openness and learn how to deal with the resulting new information. Ultimately, allowing the open discussion of salaries fosters healthy competition, self-awareness and self-improvement among employees – a positive outcome that every company should embrace. Should employees be allowed to discuss their salaries openly? Share with us in the comment box below! CareerBuilder Singapore is the owner of JobsCentral.com.sg, one of Singapore's largest job and learning portals. Get a free career personality test and more career- and education-related articles at JobsCentral and JobsCentral Community. Alternatively, Like us on JobsCentral Facebook Page or Follow JobsCentral on Twitter for more career-centric content!