In the month that gender pay gap reporting has begun, we hear from Irish HR leaders on the pros and cons of disclosing salaries in job ads.
The great resignation, mandatory gender pay gap reporting, a competitive labour market, remote working, greater work-life balance, quiet quitting and four-day work weeks.
These are some of the work-related topics that have been discussed at length over the past year to 18 months. Ever since the pandemic sent shockwaves around workplaces two years ago, workers have been collectively asking for more from their employers.
Numerous surveys carried out among workers have found that many are voting with their feet if they don’t get what they want, whether it’s greater flexibility or higher pay.
It’s worth bearing in mind too that a lot of what people want from their employers is based around holistic provisions like better diversity and inclusion policies or greater employee wellbeing packages.
However, a lot of what workers want is always going to be about salary. While plenty of people love their jobs, they aren’t willing to work for less than what their work is worth – and rightly so.
With all the conversations going on about how employers are being pressed to cater to workers’ wants and needs, one thing is going unaddressed by many companies that are hiring.
That is the question of whether to include a mention of a salary in a job ad. It’s a divisive question, but it shouldn’t be. We all like to know what the rate of pay is for a position so we can compare it with other roles.
And that’s where the objection to posting salaries lies. Employers argue that posting salary details can leave them open to competition and they will end up being pressured into increasing pay rates to attract and retain talent.
Genuine reasons for not disclosing
HR leaders can see both points of view. Damien McCarthy, CEO of Irish consultancy HR Buddy, said there can be “genuine reasons for the lack of information surrounding salary in job advertisements”.
As well as the aforementioned concern over competition, he said some employers do prefer to mention salary details at a later stage in the recruitment process for fear of attracting the wrong candidates.
“The employer may also want to protect the employee from having their salary publicly advertised,” he added.
The argument could be made that workers would prefer recruiters to be open and transparent about salary details for the benefit of the whole market.
McCarthy reckons that a compromise can be made somewhere – one that would enable workers to shop around for the best salary offer while letting employers keep that information relatively discreet.
“I would prefer if we had a little more faith in employers and afforded them more respect,” he said, explaining that disclosing salary details at application level rather than in the initial job ad would be a good solution.
“I think legislation that would allow for remuneration to be disclosed at application level would be good legislation in comparison to forcing employers to include it in the job ad when they may have genuine reasons for not doing so.
“I do, however, strongly agree that candidates should have salary information well in advance of a job offer and [they] should be entitled to this information before making a commitment to the recruitment process.”
Mary Connaughton, director at HR professionals body CIPD Ireland, agreed that fears of requests for pay increases is one of the main reasons for not disclosing salaries.
She also pointed out that many organisations are “not transparent about pay internally and perceive a risk of internal requests for pay increases where an employee believes others in similar roles are paid more”.
Confidentiality concerns are no excuse
But Connaughton said that concerns about confidentiality of individual pay should not be trotted out as an excuse by employers who don’t want to share pay data.
In the context of the new mandatory gender pay gap reporting obligations that were introduced earlier this month, Connaughton said that it is necessary for companies to educate their workers on what is meant by equal pay and how things like pay banding are calculated.
She believes that providing pay guidance in a job advert is “good practice” since it helps applicants “understand the pay band where the role sits, and therefore they can compare it to their current pay or pay aspirations”.
“It is an important part of pay equality, and a tool for tackling the gender pay gap, as employers can eliminate those who are seeking significantly different pay rates at an early stage of the recruitment process, and reduce the risk of some candidates arguing for more.”
Gender imbalance
Connaughton also said that the lack of pay transparency has “traditionally been found to favour men”.
McCarthy added that when employers are transparent from the outset, “it reflects on their company well from a diversity and inclusion perspective” and generally will help in closing gender pay gaps and other biases that may exist.
For companies that aren’t convinced they need to disclose salary rates, he warned that such is the competition in the jobs market at the moment that some potential candidates “may not even bother to apply” if a role doesn’t list the salary range.
While both employers and job applicants have their reasons for wanting salaries to be transparent or hidden, what gets decided in the end may be determined by the market.
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