Employee Retention

Why — and how — employers should embrace pay transparency

The rewards include diminished organizational risk and, most importantly, an employee base that feels valued.

Garry Straker

Oct 07, 2021 • 5 min read

5.00 (1)

Read Article Review Share

Transparency

Trust

Trust and Transparency

Openness

Clarity

Summary

Pay transparency is beneficial to employers and their companies. Many employers are adapting to pay transparency to avoid negative outcomes such as undeniable market pressure, high employee turnover, and higher recruiting costs. Companies have been able to circumvent negative outcomes that invariably arise from any mystery surrounding pay, which may result in employee resentment and tarnished employee branding. The article further explains the steps companies take to apply transparency, such as establishing a pay philosophy and pay structure, plus a lot more.

Takeaways

Before applying pay transparency, companies try to understand what they are trying to achieve, with transparency beyond meeting a legislative mandate. Upon applying, pay transparency benefits them by enabling them to respond to current market conditions such as undeniable market pressure, and high employee turnover.
Introducing a pay philosophy in a company will greatly reflect pay transparency, a consistent pay philosophy gives the company and the employee a frame of reference when discussing salary in a negotiation.
Pay transparency is gaining considerable momentum, many companies have been compelled to take a hard look at how their organizations measure up when it comes to paying equity.