Pay Transparency
Definition
The practice of openly sharing pay ranges and compensation criteria.
What is Pay Transparency?
Pay transparency involves publishing salary ranges in job postings, disclosing internal pay bands, and educating employees about compensation decisions. It is currently required in many states, including California, Colorado, Connecticut, New Jersey, and New York.
Why is Pay Transparency Important for Employers?
- Promotes equity and reduces pay discrimination
- Builds employee trust and improves recruitment
- Required by law in some jurisdictions
FAQs
What is required under pay transparency laws?
Requirements vary by state, but many laws now mandate posting salary ranges in job ads or sharing ranges with applicants.
How does pay transparency support DEI?
It reduces bias, promotes pay equity, and fosters trust by eliminating secrecy around compensation.
Can pay transparency hurt morale?
Only if pay practices are inconsistent or inequitable. Transparent communication and fair practices tend to strengthen morale and accountability.
How ExtensisHR Can Help
We assist by:
- Reviewing and helping customers implement pay transparency policies
- Conducting thorough pay equity audits
- Advising on and creating compliant job postings
- Educating managers and employees about compensation structures