How Pay Transparency Can Help Close the Gender Pay Gap and Other Workplace Inequalities
About half of all employees work for companies that prohibit or discourage discussion of wages at work, according to a January 2014 study by the Institute for Women’s Policy Research. The numbers are worse when you look at the private sector, climbing to more like 60 percent of companies that forbid such discussions.
“While there may be no direct link between pay secrecy and pay inequality, pay secrecy appears to contribute to the gender gap in earnings,” the study says.
Though it’s a bit of a grey zone, workplace policies forbidding discussion of wages aren’t legal. The National Labor Relations Act of 1935 protects the ability of employees to associate, organize, and bargain collectively for conditions such as wages. According to the Act:
Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.
While the federal government makes its own compensation scale fairly transparent, it’s really startups that are pushing transparency in the private world. Among those is Buffer, an application-based online publishing company, which goes as far as posting online the salaries, and the equations for determining those salaries, of everyone who works for the company.
“One of the highest values we have at Buffer is transparency,” Joel Gascoigne, chief executive and founder of Buffer wrote on his blog last December. “Transparency breeds trust, and that’s one of the key reasons for us to place such a high importance on it. Open salaries are a step towards the ultimate goal of Buffer being a completely ‘Open Company.’”