New York City recently passed a bill requiring employers to provide salary ranges on their job descriptions beginning April 2022. They join California and Colorado in putting laws in place that aim to eliminate pay gaps and bias in recruitment. Pay transparency is an important consideration to have in mind for the coming year because it is quickly becoming a best practice in recruiting.
In the past, salary ranges were often regarded as privileged information, and talking salary amongst colleagues was frowned upon or even prohibited. Now in this tight, candidate-driven market potential applicants are demanding more. To attract and retain applicants, organizations must show they are invested in their employees and the contributions they make.
Being transparent with candidates builds trust and saves time and money. By posting the salary range for the role within the job description, candidates can quickly ascertain if the position meets their salary requirements. It improves the candidate experience simply by eliminating the process of applying (which can be tedious) and interviewing (sometimes multiple rounds) only to discover the salary is too low. This also saves time in the organization’s recruiting process and ideally ensures offers are aligned with the candidate’s expectations.
Pay transparency gives employees an understanding of how their compensation fits within the organization. It can also establish clear expectations for raises and promotions. Showing how their work impacts the organization leads to a more empowered workforce that takes ownership of their positions and can lead to more unity in teams. This creates a more positive, engaged company culture, which leads to increased retention and higher application rates.
In addition to the advantages for candidates and employees, pay transparency is also advantageous for the hiring organization. From a finance perspective, it helps to clearly define the budget needed for each role. It is also a very actionable way to demonstrate a commitment to a diverse, equitable, and inclusive culture. Although it is not the law everywhere, if an organization is looking for a competitive advantage in hiring, pay transparency is a very strong way to achieve it.
Read More: Salary Disclosure Debate is Heating Up
Benjamin Freedman is the CEO of Weiser Innovations. Weiser is an innovative talent acquisition firm with deep roots in the nonprofit sector and partners with 501(c) Services to provide talent acquisition assistance to its 3,000 nonprofit clients. Contact us today for talent acquisition assistance.
