Pay transparency laws are in place in 13 states where employers must disclose pay ranges for open positions. One may assume that publicly announcing salaries could be problematic for companies that have a history of low balling experienced and educated candidates after putting them through a lengthy interview process, yet that doesn’t seem to be the case. While the laws were passed to combat gender and racial pay gaps, surprisingly both job seekers and employers alike are realizing the positive effects of pay transparency.
Pay transparency saves time and money. Those searching for work have an easier time finding positions that meet their salary and benefit demands, and don’t waste time applying for jobs that don’t. Meanwhile company HR directors know that when they sit down to interview a candidate, that they are meeting with a person who is interested in what the company stands for, the pay range offered, and the benefits provided. They’re able to hire talent more quickly and move their focus to other tasks of their job.
One of the biggest positives to pay transparency for job seekers is the empowerment it offers. Gone are the days of wondering if you’re being offered a fair pay for the position, today’s job seekers know exactly what the starting salary is and understand they can negotiate for higher pay relative to their education, experience, and job performance. Although California was the first state to pass a pay transparency law, we do owe some thanks to Gen Zs and Millennials for how employers today approach their job listings. The younger generations of workers demand transparency and fairness and they expect better pay and benefits that support their work-life balance.Although pay transparency laws are in place in just a fraction of states in the U.S., many large corporations in cities and states where the laws have not passed use pay transparency to attract top talent, and to build trust with current employees. When employees know their value and feel appreciated productivity increases as does employee retention. Not to mention, a company that recruits nationally needs to abide by the employment laws in other states that’s why it makes sense for national corporations to embrace pay transparency moving forward.