When I received my first pay, I was so happy to show off that I started earning and how much I earn. I was showing off my salary. One of the friends pointed out that I should not show off that it was meant to keep secret. This suggestion kept me thinking that what is the reason that I should not show off. As I continue working in the more significant corporations, slowly, I started to realize. Sharing the pay information harbors downsides and upsides. The last workplace was a big mess when it came to sharing income information. Some senior people were getting paid way less than few recent graduates. I can precisely imagine that how dangerous imbalance it can create if everyone decided to share information straight out of their pay-stub.
Along the career path, there are different avenues to consider before expressing income to coworkers. Many work-places encourage the discussion; employees engaged in healthy talks of pay, benefits and pension plans whereas most places, employees discourage this discussion, with personal reservation or employer induced discouragement. Overall, the topic of sharing pay information itself is hugely formidable subject only a few want to participate, and most are cautious about it.
So why people do not share Pay, Benefits, and Pension plan information, with the co-workers?
Most of the time, the employees are in under the impression that they are not allowed to discuss their paycheck with colleagues. That is untrue. The National Labor act in the USA and the labor laws of many democracies, with few exceptions, i.e., Australia*, indicate that employees have the rights and employers cannot establish "Pay Secrecy" policies. Employees may engage in "the concerted activities for the collective bargaining or other mutual aid or protection." So, No one can get fired for discussing the paycheck. *Australian employers are allowed to add limited "Gag Clauses" in their contracts.
Comparative Discrimination of Self-Worth.
Beware, before exposing the secret of own pay-check! It so personal; it is self-worth. The wages are not equally distributed among employees. There are plenty reasons of dissimilar salaries including education, experience, wittiness during an interview and most important of all is negotiation skills. So two persons doing the same job may not have the same salary. Disparate salary distribution and comparison can initiate jealousy, rebellion and their productivity may decline. It creates dissatisfaction towards employer and employee may depart.
The culture of Salary Secrecy.
The employers encourage the custom of salary secrecy. It is abusive culture. The employer uses this to their benefits to negotiate down pay and discourage prospective employee to negotiate. Employers bait salary raise to meet hard to reach deadlines.
Allow co-workers to know what everyone else"s pay-This is a very modern idea, but it is the double-edged sword at the workplace.
Transparency in Pay = Motivation = Trust
If the information about pay and how and why they got pay raise, is shared among all employees; then it causes an increase in productivity, increases engagement among employees. It created productivity race and achievement is pay raise. Transparency in pay reduces gossip about how much everyone is making and cuts down the toxic and wasteful environment, and it leads to efficiency. Expressing salary information to everybody reduces the gender gap and enforces equal pay policies. Whole foods and Amazon are few examples where staff members can see each others salary information. Every government employee who makes more than 100,000, their information is posted online to the general public every year in Canada through the sunshine list.
Better edge in negotiation.
Discussing salary with others at the workplace can give a better sense of the readability of your pay. This opportunity may lead to negotiate the pay raise with a current boss or look for another job. Once you know the reasonable wage in the marketplace, you have upper hand in negotiating salary in the next post. Either way, you end up in making more money.
So in the double-edged modern philosophy to disclose compensation can bring extreme benefits to a company and at the personal level if we perceive it positively. After all, if you know more, you become fearless.
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