Show Me the Freaking Money - Sharing Pay Ranges With Associates...

Sharing pay ranges with your employees - do you do it?

Three schools of thought here:

1.  We share nothing.  Maybe we have nothing (by way of comp ranges, etc.)

2.  We have stuff, but don't share it broadly.  We'll share it with the individual employee if they are interested, during the merit review, and certainly if pay issues come up with an employee who feels underpaid, etc.

3.  We share it all.  Our range structure is published to all employees, and employees might even have access to know the grades for all the jobs in the company.

Ann Bares got me thinking about this with her recent post on the sad state of Pay Communication. 

Markets drive pay.  Companies value jobs based on those markets, and also make determinations about how much skills in a specific profession are worth, based on the ranges that are developed.  So for me, #1 (we have nothing, we share nothing, and we value jobs on the fly) isn't a practical solution, at least for companies with any size and scale. 

I don't think #3 (we share it all) is a realistic alternative either.  The problem with sharing it all is the loss of productivity and angst regarding OPR (other people's ranges).  I've worked for big companies that took this approach, and a significant amount of time is spent with the angst of knowing someone else's range.  No matter that the person with the angst doesn't know the salary or if the comp ratio is .8 or 1.2.  Their range is higher than mine! 

So for me, we're left with #2 - Share range information with the individual employee at natural times, like the merit review.  Tell them how the company creates and updates ranges, and tell them why they are where they are within the range.  Tell them the plan and the room to grow, if they stay in the same position.

Or go with Option #4 - just post a list of all the employees' salaries on the bathroom door.  I joke, but I'm sure that's happened somewhere, sometime, with a frazzled HR Pro ready to go on stress-related FMLA leave at the center of the storm.

Go with option #2....

Sharing pay ranges with your employees - do you do it?

Three schools of thought here:

1.  We share nothing.  Maybe we have nothing (by way of comp ranges, etc.)

2.  We have stuff, but don't share it broadly.  We'll share it with the individual employee if they are interested, during the merit review, and certainly if pay issues come up with an employee who feels underpaid, etc.

3.  We share it all.  Our range structure is published to all employees, and employees might even have access to know the grades for all the jobs in the company.

Ann Bares got me thinking about this with her recent post on the sad state of Pay Communication. 

Markets drive pay.  Companies value jobs based on those markets, and also make determinations about how much skills in a specific profession are worth, based on the ranges that are developed.  So for me, #1 (we have nothing, we share nothing, and we value jobs on the fly) isn't a practical solution, at least for companies with any size and scale. 

I don't think #3 (we share it all) is a realistic alternative either.  The problem with sharing it all is the loss of productivity and angst regarding OPR (other people's ranges).  I've worked for big companies that took this approach, and a significant amount of time is spent with the angst of knowing someone else's range.  No matter that the person with the angst doesn't know the salary or if the comp ratio is .8 or 1.2.  Their range is higher than mine! 

So for me, we're left with #2 - Share range information with the individual employee at natural times, like the merit review.  Tell them how the company creates and updates ranges, and tell them why they are where they are within the range.  Tell them the plan and the room to grow, if they stay in the same position.

Or go with Option #4 - just post a list of all the employees' salaries on the bathroom door.  I joke, but I'm sure that's happened somewhere, sometime, with a frazzled HR Pro ready to go on stress-related FMLA leave at the center of the storm.

Go with option #2....