How many people know how much money you make? Your spouse probably does. Does your significant other? How about your parents? Your children?
More to the point, look to the left and the right in your office space -- do you know, really know, the salaries of any of your colleagues?
Probably not (unless you are their boss).
But how would your workplace change if suddenly, over the weekend, a list of every employee and their weekly pay were posted on the bulletin board, for all to find when they arrived at work on Monday?
At many workplaces, there would be at least a day with no work. At some workplaces, learning the differences in pay among staff members would cause a rebellion, or a riot.
Earlier this week, in a New York Times op-ed column, Susan Reed argued that all businesses in the U.S. should be required to make salary data public (after a one year grace period to make strategic adjustments).
Reed argues that secret salary data masks systemic racial, gender and age discrimination. That’s certainly true, although it’s impossible to know how widespread. In my own experience as a boss, I found that secret salary data frequently camouflaged simple inequity and unfairness.
I wouldn’t go as far as Reed, and make all salary data from all companies public, by federal law. But I think companies should be required to make salary data available to their own employees, easily and on-demand and at every level of employment.
Want to know what the boss really thinks of you? Just go to the company intranet and see how your salary compares to the people who do the same work you do.
I know of only one company that actually does this — the organic grocery chain, and publicly traded corporation, Whole Foods. Any employee, at any level, in any part of the company, can go to a computer in every store and find out last year’s pay for any person in the company.
The transparency is codified in Whole Foods’ basic values, and founder John Mackey says it’s a way of actually justifying people’s compensation, and not allowing favoritism to creep into compensation. (If you know any other companies that allow employees access to their colleagues’ pay, please let us know.)
Pay has been secret for so long, we’ve lost track of why. In most cases, if salary information couldn’t withstand the simple test of openness, there’s something out-of-balance in the pay scales.
Related Stories: | Topics:Innovation, fish on friday, Susan Reed, John Mackey, United States, The New York Times Company, Whole Foods Market Inc. |
Email
Digg
StumbleUpon
Facebook
Buzz Up!
LinkedIn
Recent Comments | 10 Total
June 8, 2007 at 8:48pm by Paul Ding
You raise some other interesting points.
What does it indicate if your spouse knows how much you make but not your significant other?
What does it indicate if your spouse doesn't know how much you make, but your significant other does?
I'm sure there's significance meaning there, if only I could ferret it out....
June 9, 2007 at 10:56am by Alex
Keeping salary information secret masks inequality? So what? People aren't all the same either. Discriminatrion should be tackled at the high end of organizations, but making salary information public kills motivation and prevents managers from rewarding high performers. Ludicrous idea!
June 9, 2007 at 2:58pm by Jay Neely
Alex, I'm not sure how you've arrived at that thought. How does making salary information public kill motivation? And how does it prevent managers from rewarding high performers? If they're a high performer, then of course they deserve to be paid more. Showing that high performers *do* get paid more would increase motivation, not kill it.
The truth is, in almost every business I've been an employee of, most people end up having a guess at what other people are getting paid anyways. But not being able to say anything when there's clearly something wrong, *that* is what kills motivation.
June 10, 2007 at 12:34am by Patti
I teach at a university and my salary is not only published in the newspaper once a year, it is available on the university website. Merit raises are also published annually. Public employees know who makes what. And anyone has access to the information.
June 10, 2007 at 7:35am by Mark Bowness
This does certainly raise some interesting points, I am not against this but there is a valid comment to state that not all people are equal in their work, their output and their role amongst a team. Then again, I suppose that if someone is not doing their job properly.. fire them!
Mark Bowness
June 10, 2007 at 12:01pm by mahendra kumar dash
We know one another's salary package,pay or perks.
While working together,one discusses things with other too.But in any case,that hardly matters.
June 11, 2007 at 11:07am by Mel
It is true that not all employees are equal - however, making salaries public would insure an employer have justification for the differences in salaries.
Knowing that someone makes more than you in the same position can be a powerful training tool if you let.
June 12, 2007 at 2:14pm by Wally Bock
There's an awful lot of assumptions lurking behind the idea that publishing dollar compensation would make things better. One is that dollar compensation is the only compensation. What about flexible scheduling or job sharing? What about quality of work life? It's tempting to say that publishing dollar compensation would point up inequities, but it's not clear to me that would happen.
June 12, 2007 at 6:43pm by Harry Roman
The largest employer in the U.S. the Govt does this and no complaints about the system. To my knowledge.
June 14, 2007 at 2:46pm by Laura
I think just knowing salary differences could be deceptive. Particuraly when working in a small business. During good years the owner might make considerably more than everyone else - but then he is also the first one to take a huge pay cut should things go south.
More importantly, it is the business owner who is assuming all the risk - so even if he does not do all the day to day work (which would make his salary seem equitable)- he is contributing capital and risking the possiblity of loosing it, perhaps due to employee mistakes, the economy etc.
I do not think all employees would be able to effectively factor this information into their judgements - and could come to the conclusion that the business owner was taking too big a salary. But, could they go a year without a salary to keep the business afloat??? How much information do you need to publish so that employees can see that the owner may not have had a salary for 5 years prior...