The power of pay transparency—for both candidates and your employer brand

4 mins, 23 secs read time

Representation. Diversity, equity, inclusion and belonging (DEIB). Equitable hiring practices. These have become popular buzzwords over the past decade, often prompting more intentional conversations about hiring practices.

But what about pay transparency? This increasingly popular concept should be part of every recruiting or hiring conversation, working towards full implementation. And yes, pay transparency benefits you, too!

So, what is pay transparency?

While there are various definitions for pay transparency, they all identify a few core tenets:

• How open you are about pay and salary information, including how easily employees can find this information for themselves and fellow employees within your organization
• How clearly you communicate pay policies
• Fostering a safe workplace where employees feel comfortable and safe talking about salary
  
  

The degree to which you support pay transparency changes how it looks within your organization. Some businesses only share information on how they determine pay. Others provide full transparency into salary ranges for each role, including factors like where you live, market pay or whether you commute or work from home.

Why should I work toward full pay transparency?

Candidates appreciate companies that are open and honest about their pay structure. But did you know it's also good for business? From reducing pay inequity to creating a culture of openness to increased productivity, you can reap all the benefits of pay transparency, too.

• Pay transparency can push you toward your DEI goals. It reduces pay inequity across groups, including sexual orientation, gender and ethnicity. Data from Handshake revealed that organizations get 13% more applications from black students when they include the salary (range) in the job listing.
• Being transparent encourages employees to stay. A Payscale study revealed that 72% of workers who didn't receive a raise or any rationale why or didn't believe that rationale planned on finding new jobs outside their organization within the first six months. When workers didn't receive the raise but believed the reasoning, their likelihood of quitting dropped. And their level of satisfaction mimicked those who received the raise.
• It builds trust between employer and employee. When you have open conversations about pay and share salary information on job postings, you foster an honest relationship between candidates or employees and your business. Instead of hiding this information and creating a sense of secrecy, you lead with transparency.
• Pay transparency fosters a culture of openness. Michelle Cheng, talent director at Notion Capital, explains that companies that embrace pay transparency treat "everyone like an adult and [establish] a culture of openness" that top talent looks for. Businesses that share salaries openly are also more likely to compensate equitably.
• Being transparent attracts top talent. Pay transparency gets more interest from diverse talent. But did you know it also attracts the best of the best? In a highly competitive market, top candidates can be picky about where they apply. Salary ranges on job postings can be your competitive differentiator, especially if it aligns with market rates.

How does pay transparency make our company more appealing to top talent?

Half the battle of attracting and retaining top talent is about building an unforgettable employer brand. While many factors contribute to your employer brand, pay transparency ranks near the top.

Handshake's Gender Equality Network Trends report revealed that "students overwhelmingly chose 'salary ranges in job postings' as the greatest motivator for applying." And when asked to rank factors related to gender diversity, Gen Z ranked pay equity as one of their top considerations in where to work.

Job seekers are more likely to apply for roles that disclose the pay information in the job description, but it also creates a culture of trust between you and candidates or employees.

Pay transparency can even highlight issues, like pay inequalities across genders or ethnicities, to address. It's a stop on the route to full pay parity... and top-notch candidates know it. This openness and dedication to creating an inclusive and equitable work environment is another magnet for top talent.

How our pay transparency tool can help

Embracing pay transparency is about more than adding a salary range to your job postings—but it's a start—and why we launched our pay transparency feature. So, what does the pay transparency tool help you do?

• Create rules and apply salary ranges to your job listings
• Add guardrails to ensure legislative compliance and accuracy
• Automate inputs to minimize manual errors and incorrectly uploading information
• Create a standardized, more efficient way to add pay ranges on your job posts
  
  

It also helps you attract more candidates, especially underrepresented applicants, by highlighting your commitment to closing the pay gap and fostering an open culture.

Discover the power of putting people first

Whether it's enticing top-tier talent to work with you, building a transparent culture new and existing employees rally behind or making strides toward pay parity, there are many reasons to embrace pay transparency.

It shows prospective employees you value honesty and openness—you put them first—from the very second they engage with you on the job posting. Our pay transparency tool helps you be more transparent and become better at hiring.

Want to build transparency into everything you do within your organization? Read our blog to find out how.