Preparing HR for the Next Phase of Pay Transparency

Half of Job Ads Now Contain Salary https://www.kajisoku.net/getting-started-next-steps-4/ Information Global jobs board Indeed has reported that 50 percent of the U.S.-based job listings on the site now include some employer-provided salary information, the highest share yet recorded. “We’ve told employees that our salaries are in line with the market, but they never believed us,” Rodriguez says. “Even though we were already doing that, I don’t know if people were paying attention to it,” Rodriguez says, “because when they saw posted pay ranges for new employees, they said they had no idea that their position went up to the maximum of that range. Those statements did not prevent workers from expressing surprise when they saw the upper limits of their wage ranges included in job postings. People know that when they have two years of experience, they’re going to get this much, and there’s very little room for negotiation.”

• Consequently, pay transparency can directly impact an employer’s brand reputation and ability to attract and retain talent.
• By 2027, at least a dozen states, multiple cities, and certain counties will require public or applicant-specific disclosure of pay ranges, with some requiring pay data reports.
• A growing number of states also explicitly address remote positions in their pay transparency requirements.
• Salaries were rarely discussed in polite company, and employers did not disclose their compensation for job openings until making an offer.
• Pay transparency should reflect a comprehensive compensation philosophy that aligns with an organization’s culture, values, and priorities.

And it’s changing how companies earn trust and attract talent.

• Our Human Capital Analytics collection gives you access to the latest insights from Aon’s human capital team.
• Consulting helps leaders decide what to change—and how to make those changes stick.
• That clarity is strongest when managers are supported by organization-wide fairness narratives led by HR, rather than being left to interpret or explain pay decisions in isolation.
• Include clear and concise pay ranges in all your job postings along with detailed information about benefits and other forms of compensation.
• As the movement toward transparency reshapes the workplace landscape, now is the time to act.

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Compliance is the Starting Point

Organizations must be up to date with current laws to avoid legal risks and penalties. Organizations must be prepared to address these effectively, to ensure a smooth implementation and maintain employee trust and satisfaction. Organizations should openly communicate the promotion criteria, laying out the skills, experience, and performance levels required. When they see a clear, transparent path to advancement, it signals respect for each employee’s growth journey and they’re more likely to feel motivated and engaged in their work. When promotion criteria and pay structures are transparent, employees feel like they’re on a fair playing field.

Regulatory Compliance

Explain the rationale, goals, and expectations to employees clearly and transparently through multiple channels. Outline factors used to determine pay, such as experience, qualifications, and performance, to avoid confusion and potential inequities. Will you disclose individual salaries, ranges for specific roles, or a combination? HBR described a study where when the government of California made city managers’ pay transparent in 2010, average compensation actually dropped by about 7% in 2012. You can avoid these challenges by first sitting down and looking at the structure as it is, and ensuring that there’s a full structure, plan, playbook, set of rules, career pathing strategy, and so on before you open the information vault. Also what we discussed at the top about the different kinds of transparency – process, outcome, and communications.

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Benefits of Pay Transparency

Many state and local governments have also passed laws prohibiting employers from considering a candidate’s salary history when making hiring or compensation decisions. Being forthright about compensation helps improve pay equity – a hot topic with many employees today. Depending on the jurisdiction, employers may be prohibited from asking candidates for their salary history, or they may be required to disclose a wage range for current and/or open positions. Employers should evaluate their hiring practices for compliance with current and future pay transparency obligations.