We use cookies to collect information about how our website is used and to improve the visitor experience. You can change your browser’s cookie settings at any time. Please review our privacy policy for more information. OK
Years ago, employees did not have many tools to compare their salaries in the marketplace, but now we have such sites as Glassdoor.com and Salary.com. Still, many factors go into setting compensation, and it may be beneficial for companies to have some pay transparency to help workers better understand how they’re compensated.
In general, pay transparency “leans more toward being open and clear about your policies, compensation philosophy and how pay decisions are made,” says Sharon Podstupka, a communication expert and principal with executive compensation consultant Pearl Meyer in their Manhattan office.
With all the data out there and pay equity in the spotlight, companies need to start doing a better job of explaining to people how pay is set and determined, Podstupka says.
In a recent survey by Pearl Meyer, about 80 percent of company respondents felt employees didn’t understand how to appropriately compare their own level of pay to either those in similar positions to themselves at other companies or to their internal colleagues.
Most companies rely on managers to have conversations about pay, but often they’re not effective in explaining compensation, says Podstupka.
“While they may have been coached by the company to have those conversations, they may not be comfortable or confident in having the actual discussions,” she says.