In January 2022, New York City passed the Wage Transparency Law (link). This monumental law requires all organizations to publish salary ranges for every role they hire for, including promotion and transfer opportunities.
California also passed the Pay Transparency Act that went into effect on January 1st 2023 and requires employers with 15 or more employees to include a pay scale for a position in any job posting. Most recently, Washington DC’s Pay Transparency Act will go into effect on June 30th 2024. As these laws and others around the USA emerge, they raise important questions for organisations. Is it time for salary ranges to be added to all job descriptions?
Current Status of Salary Transparency
In addition to laws and regulations, salary transparency exists in major international development organisations. The World Bank, as does the United Nations, has an open salary system for its staff. In the USA, salaries for all senior non-profit leadership are available publicly through the annual release of Form 990s. There is also a growing advocacy campaign called Show the Salary, which has pledges from many major international development organisations to share salaries in all roles. Some job boards like NTEN now require a salary or salary range if you want to share a role on their site. There are also sites like Glassdoor where salaries and other information about organisations are shared widely.
Where is the pressure to change things coming from? Much of it comes from internal pressure from employees themselves. Studies, including this survey, show that nearly 80% of employees want their organisation to post the salary. This survey also found that 68% of employees would switch employers for greater pay transparency, even if compensation were the same.
SRI Executive sees many anecdotal comments about sharing salaries during our client projects. During one project, a candidate wrote to us stating, “Not publicly posting salary ranges is a practice within our sector that breeds inequity, and I, therefore, cannot in good conscience pass on an opportunity that does not abide by this practice.” Other candidates have also replied asking why the salary was not included and cited studies featured in this report or the popular blog posts on the topic by Vu Le.
Benefits of Sharing the Salary
What are the benefits of sharing the salary ahead of time? Most importantly, it preemptively screens out candidates whose salary preferences do not match the role's needs. Countless hiring processes reach a final offer stage only for the two sides to realise they are far-off on salary. The data supports this; according to a recent report, 50% of candidates have withdrawn from job offer processes because the compensation offered didn’t match their expectations.
Posting the salary also expands the talent pool; the range can attract candidates who may have thought they weren’t an initial fit for the role. In fact, an Indeed survey of 1,500 people found that 56% were more likely to apply for a company they weren’t familiar with if the salary range was listed.
Significant DEI benefits come from being transparent about salary questions. Studies are beginning to show that US states that passed pay transparency laws have seen their gender pay gap subsequently decrease. In addition, organisations like Reddit are removing salary negotiations from their hiring process in order to further decrease the gender pay gap.
Moving Forward
Ultimately, we are moving towards a future where salary transparency could be a legal requirement in most locations. For many organisations, it’s time to start thinking ahead and building a plan. Remember that there are a range of options as you embark on this journey. You may choose to disclose the full salary range or only the minimum salary on job descriptions. Alternatively, you might be able to share this information verbally when speaking with potential candidates. The sooner you can share this information, the better – for both you as well as current and future employees.
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How SRI Can Help
SRI Executive recommends that all our clients include the salary in job descriptions; however, the organisations themselves can decide at their discretion.
We bring 25 years of experience and have placed hundreds of executives in non-profit organisations worldwide. Through our Search Practice, which facilitates hundreds of salary and compensation discussions each year, we understand the delicate issues organisations must navigate with this question and similar ones. Our Consulting Practice can help with questions around organisational strategy, governance, and similar topics to help answer salary and benefit-related issues.
(Disclaimer – SRI Executive works with several different client organisations and encourages them to post salaries in their job descriptions or share them with clients as soon as possible in the process. As a global firm, SRI Executive recruits for internal roles from a variety of markets and are in the process of reviewing and adjusting our salary transparency policies.)
