Should you publish salary ranges?
In a reaction to the historical practice of employees not knowing their salary range and suspecting that they were being unfairly treated, one of my clients posted on the intranet salary ranges for every position in the company. Being egalitarian, and wanting to demonstrate a culture of transparency and accountability, this seemed to be the best way to platform Human Resources as a trusted business partner. The second advantage tied into another HR Goal, to make the path to career advancement more easily communicated.
Instead of building trust and confidence, it created a toxic environment where employees held mid level managers accountable for explaining why other positions were graded higher then theirs. “But we do 15 different tasks and the people in that role only do 3.” On its face, the argument seems to have merit. In reality, a position may have 15 different duties with those duties being at the same level of mental complexity and potential for error as having 3. More duties, doesn’t necessarily equate to a higher grade unless those duties are at a higher mental complexity, potential for error, needs more experience or has a greater impact on the income statement or strategic plans of the company and are being performed 30% or more of the time. Regardless, the well intentioned change in practice lead to a toxic environment of whiners and front line managers left explaining something they were not equipped to respond to. All of this had a negative impact on employee moral. Additionally, having a compensation practice as a competitive advantage can be erased if employees can make available your salary ranges to the competition.
When I came in to conduct a position analysis with each executive for the positions that report to them, not a single complaint was issued about the pay levels of their direct reports. But through out the project, I was confronted with explaining the grades of other positions in other departments. As a young consultant, I used to think that transparency was the best practice. But if the of the Human Resource Department is to contribute to building a culture of engaged and productive employees, then showing only the ranges that report to each manager is the best practice.
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